House prices are unchanged since middle of August, survey reports

The recent drop in house prices came to a halt this month as a small rebound across most of Britain offset falls in London and the West Country, a survey of estate agents shows today.

The recent drop in house prices came to a halt this month as a small rebound across most of Britain offset falls in London and the West Country, a survey of estate agents shows today.

After five consecutive weeks of falling prices, the value of the average home has stayed virtually unchanged, with a fall of £19 in the price of homes put up for sale since mid-August.

Rightmove, a property website that checks 85,000 homes each month, said prices were "going nowhere", after a drop of 2 per cent, or £3,800, in the five weeks up to mid-August. Miles Shipside, its commercial director, said: "We're at a readjustment phase. Prices are going nowhere, activity is slow and buyers need to be enticed back into the market. At the moment we're faced with a housing stalemate as prices and activity adjust from a seller's to a buyer's market. Over-optimistic prices just won't stick in this environment."

There has been heated debate over the state of the housing market - and the wider consumer economy - since Halifax said prices dropped for the first time in two years last month with a 0.6 per cent fall. Figures from the Bank of England showed that in July, new mortgage approvals fell by the largest amount since records began, pointing to further price falls ahead.

The Rightmove survey is the first measure of activity in September and could spark a rebound in the pound as traders bet that the housing market has stabilised. Halifax and Nationwide do not publish their September data for another 10 days.

Rightmove said lower value properties saw the largest falls, with terraced homes down 3.4 per cent since July and flats dropping 3 per cent.