Britain's biggest estate agent says the property market is about to cool off in a big way

A swimmer climbs out of an icy pool at the Songhua River during the Harbin international ice and snow festival in Harbin, Heilongjiang province, January 5, 2008.

REUTERS//Aly Song

Countrywide, the UK's largest estate agency group, is warning of a coming chill in the property market.

In a trading update on Tuesday, the group, which owns brands like Bairstow Eves and Hamptons International, says it has had a bumper start to the year as buyers rushed to snap up buy-to-let properties and second homes ahead of the new 3% stamp duty surcharge that came into effect on 1 April. House exchanges in the first quarter were up 30% on last year.

But Countrywide warns: "We expect the housing market to slow in the second quarter post the surge in buy-to-let activity in the first quarter and reflecting challenges from the political and economic uncertainty in the lead up to the EU referendum in June."

This is no huge surprise. The Royal Institution of Chartered Surveyors made a similar prediction recently, saying most surveyors in London expect prices to actually fall over the next three months.

From business investment to diplomatic relations, almost everything is now being put on hold in the run-up to Britain's referendum on membership of the European Union. Nobody wants to bet on which way the vote will go, which has bought decision making grinding to a halt. As a result, Britain is basically just ticking along until after the referendum.

Countrywide's CEO Alison Platt says in Tuesday's statement:

We are encouraged by the strong performance delivered in the first quarter and remain on track to pilot our customer focused multi-channel proposition in three brands during the second quarter. Mindful of the political and economic uncertainty surrounding the EU referendum we are taking a cautious view of the coming months.

Notwithstanding this, however, we continue to expect to make strong progress in 2016 as we execute our strategy and maximise market opportunities and therefore maintain our current financial outlook for the full year.

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