3.9 percent is no drop in the ocean

Falling house prices are showing no signs of abating, with a new survey showing a 3.9 percent drop over the past year.

While sales were up by 10.6 percent in June, housing intellignece firm Hometrack claims that this is due to people agreeing to sell for lower prices.

The firm predicts a further fall by one percentage point during the second part of the year, as more homes come on to the market but sales remain subdued.

Hometrack research director Richard Donnell said: 'The second half of the year is set to see subdued demand keeping a further downward pressure on prices.

'While the balance between supply and demand is not significantly out of kilter, subdued demand and weak consumer confidence are set to keep headline prices under modest downward pressure over the months ahead.'

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