Brexit 'could hit UK property market for years'

Experts have warned a Brexit vote could hit Britain's property market for years as figures revealed a slowdown in annual house price growth last month.

The average price of a UK house edged up 0.2% to £204,368 in May, but year-on-year growth slipped back to 4.7% from 4.9% in April, according to Nationwide Building Society.

Economists said uncertainty ahead of the EU referendum was already holding back house prices and warned a Brexit vote would hit the property market hard.

Activity is already easing back after a rush to secure sales before April's stamp duty hike for buy-to-let and second homes, and Nationwide said there would be a further slowdown over coming months after the first quarter lending boom.

Howard Archer, chief UK and European economist at IHS Insight, said a Brexit vote could impact activity for at least the next two years.

He said: "A potential major downside risk to housing market activity and prices comes from the vote on EU membership on 23 June.

"A vote to leave the EU would be liable to see a marked hit to UK economic activity over the rest of this year and in 2017 amid heightened uncertainties, which would likely weigh down heavily on the housing market."

Mark Posniak, managing director at Dragonfly Property Finance, said: "What happens in June could determine the fate of the market for several years to come."