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Unsold properties reach record high

House asking prices have dropped for the first time this year, falling 1.6 percent in July as the number of unsold properties on estate agents' books reached record levels.

According to a survey by property website Rightmove, the average asking price for a home dropped £3,797, to £236,597 in July.

While some buyers are staying away in the fear that prices have yet to bottom out, others are struggling to sell because mortgage approvals are running at a rate half of what it was before the financial crisis set in.

Miles Shipside, director of Rightmove, said: 'Summer sellers are more nervous about their selling prospects than the early birds who asked ever higher prices during the first six months of this year.'

Mr Shipside added: 'While property has a good long-term record as a hedge against inflation, in the short term property prices have become significantly cheaper in real terms as the cost of living has gone up, while the cost of housing has stood still or gone backwards.'

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