Although property prices in London are falling, a lack of housing is driving rental prices up by 5% a year, according to data from Haart.

The study looked at management reports from over 100 of Haart’s branches across the UK, and revealed that the average property price in London dropped by 3.7% in April, down 3.4% year-on-year.

However, Haart has reported that rental stock is down 40%, which in turn has resulted in a 5% increase in rental prices and surpasses wage growth.

The number of new buyers entering the London market increased by 0.9% in April, representing a 6.8% increase over the same month last year. Sale transactions in London rose by 16% in the month, but experienced a year-on-year fall of 1.4%.

Haart chief executive Paul Smith said: “The number of homes available to buy is still hovering below pre-referendum levels, despite a significant jump on last month.

“The UK’s undersupply of properties continues to hold back fluidity within the market, and thousands of Brits remain in homes that no longer suit their needs.”

Smith added that the market is “becoming unsustainable” for many.

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