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Confidence in the London property market has fallen to its lowest rate in two years, a survey by Lloyds Banking Group has revealed.

The quarterly Commercial Property Confidence Monitor, which surveys investment fund managers and property firms, found the net balance of those expecting improvement in the property market in London within the next six months fell to 2.8 in November, compared with 32.2 in August.

Confidence in the market outside London also dipped to its second lowest point in two years.

The crisis in the eurozone proved to be a major concern for investors with 80% of fund managers anticipating it having a negative impact on the market and over half of other property business expecting the same effect.

Lynda Shillaw, Lloyds Bank Corporate Markets鈥� managing director of corporate real estate, said the eurozone crisis, coupled with general uncertainty about the world economy, had 鈥減rompted a change in behaviour from businesses and we鈥檙e now seeing businesses shore up debt profiles focusing on longevity鈥�.

鈥淒eals for the short to medium term are becoming less frequent,鈥� she said.

However, despite the gloomy outlook, over half of major property business expected to increase their investment over the next six months. But fund managers and smaller business were much more cautious with only 25% and 19% respectively anticipating an increase in investment.

The decline in investment is expected to be most sharp in London where the net balance of those expecting an increase in investment declined from 52 in August to just 10 in November.

Outside of London the downturn in investment intentions was less sharp falling from a score of 21 to 14 over the same period.