The number of UK house sales this year is expected to fall to the lowest level in more than a decade.
The soaring cost of mortgages is putting off homebuyers, as the price of borrowing is too high for a growing number of the population.
Property website Zoopla have forecasted that sales will be the lowest since 2012 by the end of the year.
It comes as the insolvency rate for construction companies in the UK has reached the highest level in ten years, as the industry is trying to hold tight until the economic and political winds change.
House sales in UK
Zoopla said: “Mortgage rates have started to fall slowly but rates need to fall below 5% before we see an increased appetite to move home in the second half of 2023.”
The Bank of England has raised interest rates 14 times in a row as it battles to bring down inflation, but it is battering the housing market.
Zoopla executive director Richard Donnell said: “The housing market continues to feel the impact of higher mortgage rates and cost of living pressures.
“It’s resulting in weaker demand from buyers, fewer sales and very low house price growth.”
“Surprisingly, affordability has improved most in London where the price to earnings ratio will move to single digits for the first time in 11 years as house price growth continues to lag earnings growth,” the report also said.
But that still doesn’t bridge the price gap for homes in the capital. The average price of a property in London is £542,400, compared with £267,000 in Edinburgh, £253,900 in Cardiff and £167,900 in Belfast.