The crisis in the property market shows no signs of easing as the latest figures from the online estate agency Rightmove show that home sellers were forced to reduce their asking prices in April.
"Sellers have finally recognised that a decade of rising prices has come to an end," the agency said in its monthly house price index. Average asking prices slipped from £239,655 in March to £239,521 now, down 0.1 per cent, the first fall recorded by Rightmove for the month of April. Since 2002 prices have seen an average rise of 2.8 per cent at this time of year. The average annual rate of increase has slowed to 1.3 per cent, from 5 per cent in January.
The definitive Halifax index, which is more closely related to selling prices than asking prices, showed a 2.5 per cent decline in the month of March alone. The most pessimistic independent observers forecast price falls of 20 per cent over the next two years.
The figures confirm that the housing scene is stagnating, with the credit crisis choking off the availability of new mortgage finance. Last week the Council of Mortgage Lenders reported an annual drop of 17 per cent in gross lending. Demands by banks and building societies for larger deposits has seen the disappearance of the 100 per cent mortgage. The tightening up of credit criteria has hit first-time buyers especially hard.
Rightmove said that all of the market indicators revealed a decline in property market activity and "reinforce the need for the Bank of England's anticipated measures to further improve buyer affordability and confidence".
The average unsold stock per estate agency branch has risen from 67 to 70, giving buyers "the highest levels of choice we have measured at this time of year".
The time properties spend on the market unsold has risen as well, despite the recent drop in asking prices, from 82 days to 85 days over the last month, "by far the highest we have measured at this time of year", it said.
Miles Shipside, commercial director of Rightmove, commented: "Buyers who have saved through the winter and are now emerging to enter the spring market will find there are deals to be had. It's a buyers' market, but only if that buyer is buying with cash or can put down a good deposit. Sellers would be smart to look for buyers with a short chain, as there is more chance of longer chains falling apart with mortgages more difficult to obtain."
Asking prices in London, the South-east and the North-west of England fell, while East Anglia showed the largest rise.