The estate agent said the drop was due to the ongoing war in the Middle East. Demand typically rises as spring approaches, but the figure compares to a smaller 9% drop in February.

Before war broke out, Knight Frank said housing activity had been building as buyers and sellers put the uncertainty of November’s Budget behind them.

Similarly, the number of offers made fell by 7% in March, compared to a 3% decline in February.

The picture is muddied by the introduction of higher rates of stamp duty last April, which increased transaction numbers and may have softened new demand in March 2025.

In London, the number of new prospective buyers was down 6% after having increased 1% in February.

Knight Frank head of prime central London sales Stuart Bailey said: “March was slower than expected given how the year had been unfolding.

“It’s too early to tell if demand will eventually increase as a direct result of the conflict in the Middle East but for now, we have certainly seen more people come to the UK to hedge their options by renting in the short-term.”

Knight Frank added that the impact of the Middle East conflict on the UK housing market will be both sudden and gradual.

The estate agent said that many buyers have mortgage offers of below 4%, due to offers being valid for up to six months.

As such, higher borrowing costs will take more time to filter through into the property market, Knight Frank said.