Home prices may have increased in March across England and Wales but red warning lights are flashing as market conditions in London and the South East deteriorate, according to Home.co.uk.

The firm reported: “Prices continue to slide and marketing times are rising but, most worrying of all, is that the supply of property for sale has risen to near seven-year highs in both regions, and this rising trend shows no signs of abating. In stark contrast, Wales, the East Midlands, West Midlands, the North West and Yorkshire have thriving property markets.   “Oversupply threatens to tip downturn into disaster in the already hamstrung markets in Greater London and the South East. The psychology of property market downturns is well documented and buyer sentiment may be summarised by the phrase ‘Who wants to catch a falling knife?’ Moreover, the East of England looks set to follow the same path as supply rises rapidly, marketing times lengthen and price growth falls further below the level of inflation.”   The company reported that the East Midlands leads the price growth league table with a gain of 5.3% over the last 12 months, closely followed by Wales with 5.1%.

Overall, supply of property for sale in the UK is up 8% year on year. The largest contributions over the month of March were from the East (+17%) and South East (+16%).