Home sellers have slashed their asking prices by more than £4,000 during the past month as the number of properties on the market hits a new high, figures have revealed.
Average asking prices in England and Wales dropped by 1.8 per cent during the four weeks to July 12, following a slide of 1.2 per cent during the previous month, according to property website Rightmove.
The group said the fall, which was the biggest ever recorded for July, left the average asking price of a home at £235,219 – two per cent less than a year ago.
It said sellers were finally realising that they had to undercut other properties on the market from the beginning. The number of unsold properties estate agents have on their books rose for the sixth month in a row during the period, to reach an average of 77 homes per agent.
The increase bucked the usual seasonal trend, which typically sees the number of properties up for sale fall as the market gathers momentum during the busy summer selling season. The group said the rise was not being driven by an increase in the number of homes being put up for sale, with new instructions around 20 per cent lower than during the same period of 2007, but rather by a stagnating market as properties failed to sell.
Miles Shipside, commercial director of Rightmove, said the current drop in transaction levels was the most alarming characteristic of the current market, and would have the most widespread impact.
But he added any meaningful increase in sales would require a U-turn among lenders over their current lending policies.