Values dropped for the eighth consecutive month during June and annual growth fell at its fastest rate since the 1990s crash, the Nationwide reported.

The average cost of a home dropped by 0.9 per cent to £172,415, while annual house price inflation slumped to minus 6.3 per cent – its lowest level since 1992. The credit crunch has now wiped £13,500 off property prices, compared with their peak in October last year, as prices slid 6.4 per cent since the beginning of 2008.

There was some good news for homeowners as the Nationwide said the pace of price falls had slowed "significantly" during June, after May's 2.5 per cent dive.
And prices are still four per cent higher than two years ago.

National Association of Estate Agents president Chris Brown said: "The market appears to be stabilising, which should help begin to restore consumer confidence." However, Bank of England figures this week showed that mortgage approvals had slumped to a record low, suggesting further falls to come.

Economists said the data was "absolutely dire" and the market correction could be worse than previously thought.
And the National Housing and Planning Unit today warns that affordability will not be improved by the house price drops.
The group says increasing housing supply is the key.