November sellers cut their asking prices by 3.2%, the biggest monthly drop since December 2007, shows the latest Rightmove House Price Index.
Falls have now been recorded in four out of the last five months, as year-on-year price growth heads for zero.
The Index shows some 24,028 new sellers are coming to market every week, down 9.1% on previous month yet still outstripping muted mortgage approvals by two to one.
There are an unseasonally high number of unsold properties as winter buyers hang back waiting for bargains, says Rightmove.
Miles Shipside, director of Rightmove says agents are reporting that the Christmas slowdown has come early this year, as both would-be buyers and sellers are adopting a wait and see policy until the direction of next year’s housing market becomes apparent.
He says: “The combination of high unsold stocks, the mortgage famine, a shaky economy and the normal winter slowdown gives an ideal scenario for bargain-hunting buyers. The bleak mid-winter is always the best time to catch desperate sellers, and those buyers who are currently lying in wait may wish to pounce this winter rather than next.”
In spite of the current downward price trend, this month’s new sellers are still asking 1.3% more than those of a year ago. However, the price bounce is now working its way out of the annual figures.
Shipside adds: “Agents report that this price surge has now run out of steam in all but the most popular and affluent locations. As we forecast in December 2009 the price growth through the first half of the year has been reversed by price falls in the second half of the year.
“The earlier than usual fall-off in the numbers of both new buyers and new sellers indicates that many are sitting on the sidelines, waiting to see which direction the market is headed in the next few months.”