The latest house price index from Nationwide shows a monthly fall of 0.5% in August, the largest decline recorded since July 2012.
This follows monthly growth of 0.7% in July, bringing the average UK property price down to £214,745 last month.
Nationwide also reports that annual house price growth is continuing to soften at 2%, down from 2.5% the previous month.
The lender's chief economist, Robert Gardner, says he still expects house prices to rise by around 1% over the course of this year.
He explains that there is likely to be a 'modest drag' on market activity this year due to 'subdued economic activity and ongoing pressure on household budgets'.
According to north London agent and former RICS residential chairman, Jeremy Leaf, the Nationwide figures confirm much of what agents have been experiencing over the last few months - a market 'softening' further due to expected slowing summer demand.
"However, over the last few weeks have seen more interest in property again which could well transfer into an increase in sales agreed during September and October," says Leaf.
Lucy Pendleton, founder director of James Pendleton estate agents, adds: “With just four months left of 2018, the biggest monthly fall since the London Olympics brings prices dramatically in line with the lender’s forecast for the year."
"Nationwide’s prediction of a 1% increase in 2018 would mean prices finish on just over £213,000, a level not seen since April and only around £1,500 lower than current prices."
"That would undo most of the year’s gains, so if that happens, expect the slowdown to feed into the Brexit mood music as the UK careers toward an uncertain future and possible hard Brexit in early 2019."
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Properties sales in our area West Suffolk have slowed over the last two months and I am constantly seeing other agents reducing prices. Over valuing by on-line and some desperate high Street agents is happening on a daily basis to gain instructions all this is bad for the market.
Also its difficult to convince potential vendors that their property is no longer valued the same as 18 months ago. Some people fail to understand the meaning of comparables.
Notice how the fool that writes this says "UK careers toward an uncertain future" having a jab at brexit, when in reality it's the stamp duty, taxation and attack on anyone with a second home that's dragged the market. It will slide now to be negative very soon... but no doubt that's brexit's fault and nothing to do with the remoaning government and their shocking handling of it.
Price declinces have zero to do with SDLT or brexit. The simple fact is that prices got detached from affordablility. In London because of speculative / money launderer buyers. In the rest of the country but Buy to Let and ultra low interest rates. Now all these factors are heading the wrong way (money laundering is marginally more difficult, BTL now have to pay tax like everyone else and rates are now rising) it isn't surprising that prices are now declining back to pre bubble levels.
A silly comment that BTL landlords don't pay tax. Landlords already paid more tax than owner-occupiers, with their unequal massive perk of tax-free capital gains; Clause 24, licensing taxes, and punitive SDLT rates on second home owners (which hits developers, builder-renovators and owner-occupiers wanting a second home as well as landlords) has just worsened the imbalance and is extraordinary coming from a supposedly pro-business Government.
Looks like the house price boom drugs are wearing off. Who would of thought the rising housing prices would stop when wages have been stagnant for a decade? You know when we are going to suffer a massive house price down turn as the TV and newspapers are full of equity release schemes just like 2007-08.
The other elephant in the room is the aging population and relative paucity of professional 20-30 year olds over the next decade (excepting those called Mo). There will be less demand for the 1/2 bed walk up slave boxes and larger family homes.
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