Asking prices for homes have shown their biggest July fall for four years, according to a study.
House sellers have cut 1.7%, or £4,138, off the price of their homes, according to property search website Rightmove, while new sellers coming to market are outnumbering actual sales by two to one.
- Asking prices fell by 1.7% in July
- Typical asking price now £242,097
- Biggest fall in July for four years
Typical asking prices fell to £242,097 in July, the biggest fall for that month since July 2008, although prices are 2.3% higher than they were a year ago.
The fall is also the first monthly drop since January and the biggest since December last year.
Strong competition among sellers will make selling a home "challenging" over the summer months, the report warns.
Regional asking prices
The West Midlands was the only region in England and Wales to record a month-on-month increase in July, with a rise of 2% to reach £191,121.
London, which regularly records bigger price rises than the rest of the country, saw the biggest monthly fall, with a 3.6% drop taking asking prices to £460,304.
However prices in London are still 6.4% higher than they were a year ago, and the capital recorded the biggest annual rise of all the regions.
New sellers outnumbering sales
The study says sales are running at 56,220 a month on average according to Land Registry figures, while Rightmove, which covers 90% of the market, has seen more than 102,000 homes come on the market in the same period.
This means the number of properties coming to market is around double the number of completed sales, and with the distraction of the Olympics and ongoing economic uncertainty, the market will continue to be tough, the report warns.
Rightmove director Miles Shipside says: "Those keen to sell this summer have the challenging confluence of miserable viewing weather, the continuing credit crunch plus a sporting distraction of Olympic proportions.
"Those who have been on the market for many months might consider the prospects of achieving a sale to be somewhat of an Olympian challenge given that actual sales completions are just half of what they were five years ago.
"The weather might not be hot but in most parts of the country the competition to sell is."
The study says the number of unsold homes per estate agency branch is "stubbornly high" at 75, and stock levels have risen for five months in a row as new sellers continue to outstrip the number of homes sold or taken off the market.
In the year before the onset of the financial crisis, the number of new homes coming to market outstripped sales by a smaller margin of 25%.