Property developers came under pressure on the London stock market following the steepest fall in UK house prices in over two years, deepening concerns about the outlook for the housing market.
Barratt Redrow was the FTSE 100’s worst performer, falling as much as 2%, while Taylor Wimpey shed up to 1.5%. Across the broader FTSE 350, housebuilding stocks declined by 1.2%.
Rob Peters of broker Simple Fast Mortgage warned that the downturn “could be the canary in the coal mine,” citing the effects of rising interest rates, persistent inflation, and economic uncertainty. “If growth keeps falling at this pace, sellers will be forced to slash prices just to get deals through, which risks dragging the entire market into a stagnation spiral,” he added.
Babek Ismayil, founder of estate agent OneDome, pointed to the end of the stamp duty holiday as a key factor behind the current slowdown, describing it as “a lull in activity and demand.”
While hopes remain that a Bank of England rate cut in August could reignite the market later in the year, Ismayil cautioned that ongoing inflation and policy uncertainty are keeping both buyers and lenders on edge. “A key issue is that buyers aren’t just battling financial pressures but are having to navigate a homebuying process that’s slow, fragmented, and frighteningly Dickensian,” he said.
