The chief executive of Rightmove has said Britain’s housebuilders face the worst conditions since the financial crisis.
Johan Svanstrom said developers were “seeing conditions among the most difficult experienced since the global financial crisis”.
“As a result, new developments coming to market are at their lowest in over a decade,” he said.
Mr Svanstrom said the industry was suffering because of the “elongated” Middle East conflict, persistently high interest rates and the uncertainty surrounding the next Budget.
He delivered the verdict as Rightmove said “subdued” growth in its new homes division meant revenue growth this year would be lower than previously expected. It cut its growth forecast to 6 to 8pc, down from 8 to 10pc.
Jennie Daly, the chief executive of Taylor Wimpey, separately warned that the housing market was in a “prolonged downturn”.
The builder has cut the amount of money it is returning to shareholders and reduced its forecast for the number of homes it expects to sell this year.
Ms Daly said: “We’re doing all that we can in terms of driving costs out of the business and being as efficient as possible.”
Fresh figures from Nationwide showed house price growth had slowed as the Iran war pushed up mortgage costs.
Property values rose 1.8pc in the 12 months to July, a slowdown from a 2.2pc growth rate in the year to June, according to the Nationwide house price index.
Prices did edge up 0.1pc between June and July, having flatlined over the previous month, making the average home worth £277,542.
‘Pressure on energy prices’
Robert Gardner, the chief economist at the lender, said the weakness in house prices reflected the “uncertain economic backdrop”.
He said: “Geopolitical tensions remain high, with the conflict between Iran and the US again exerting upward pressure on energy prices and market interest rates in recent weeks.
“Financial market expectations for the future path of Bank Rate have been volatile, reflecting shifting views about the inflationary implications of events at home and abroad.”
Since the outbreak of the Iran war, mortgage rates have climbed rapidly, bringing a slowdown in the property market as prospective buyers delay or hold off on new home purchases.
Approvals for house purchases fell by nearly 15pc in May, the largest monthly decline since late 2022, according to figures from the Bank of England.
Martin Beck, the chief economist at WPI Strategy, said: “July’s modest monthly increase is a long way from a decisive recovery. The backdrop for the housing market has become more challenging in recent weeks as the rise in energy prices has revived concerns about inflation.”
The Bank kept interest rates flat at 3.75pc on Thursday for a fifth consecutive meeting amid ongoing uncertainty over the Iran war.
