Buyer demand has fallen by 13% in March compared to the same month last year, as surging mortgage rates and uncertainty have impacted confidence.

The latest house price index from Zoopla shows that annual growth in asking prices has remained stable month-on-month at 1.3% in March, unchanged from February.

But agreed sales are down by 2% year on year and Zoopla says the market is being held up by committed movers who already have mortgages agreed.

There are signs that those who are not yet committed to a purchase may be delaying moving decisions and adopting a more cautious, wait-and-see approach.

Mortgage rates have soared, with the average two-year fixed rate jumping by 92 basis points since the outbreak of war.

The largest decline in active buyers was recorded in the North East and West Midlands, albeit with enquiries falling off a high base compared to last year.

Zoopla executive director Richard Donnell, Executive Director at Zoopla says: “The market remains active, but becoming increasingly reliant on a smaller pool of serious buyers.

“Some early stage buyers are adopting a wait-and-see approach but there is a sizable group of committed buyers who are pressing ahead with housing purchases.

“If mortgage rates stabilise at current levels we expect sales activity to continue to hold up well compared to last year.

“Further increases in borrowing costs could weaken demand and impact sales volumes later in the year.

“The outlook is far from clear although we can see demand has stabilised over recent days.

“For buyers, there is less competition and more choice, but affordability is becoming more stretched.

“For sellers, homes are still selling, but buyers are more selective and price-sensitive.

“Setting a realistic asking price with the help of a local agent will be critical to securing a sale.”