PROPERTY prices in Britain are expected to lag behind inflation this year and in 2019, according to a poll of property-market experts.

Brexit will hold housing market growth back with prices rising overall on average by 1.7 per cent nationally in 2018, the data from the quarterly poll by Reuters suggests.

This is less than the 2.5 per cent forecast for inflation.

The research suggests that prices in London will fall by one per cent this year and the report says that this would be the first annual decline in the capital city for almost a decade.

It explains that Sterling is down around 10 per cent against the dollar since Britain voted nearly two years ago to leave the European Union, making properties cheaper for overseas investors, but generating prolonged ambiguity over Brexit talks that has made buyers wary.

It suggests that next year house prices will rise two per cent nationally and nudge up 0.5 per cent in London, while in 2020, they are forecast to increase two per cent in both markets.

“There is a lot of uncertainty in the market as to where we are with Brexit negotiations,” said Oliver Knight, associate at estate agency Knight Frank.

“That has really kept a lid on further growth. There is a wait-and-see attitude.”

The report also says that a lack of clarity on how post-Brexit Britain will operate will impact on the housing market. Almost half of respondents said that they think demand in London’s housing market will decrease over the next year.