Signs of slowdown

Although house prices have continued upwards, the pace of growth has now stabilised for the first time for five months, with the latest rate of increase remaining the same as in the previous month.

Despite this, many chartered surveyors expect prices to continue to rise over the next few months, with the difference between those expecting prices to rise against those expecting a fall dropping to 56 per cent from 75 per cent last month.

The reasoning behind this is that there is still a shortage of suitable homes on the market, as the average number of properties per surveyor fell for the third consecutive month.

Ian Perry, national housing spokesman for RICS, said: "The summer months are traditionally a quieter period as people focus on holidays, and the first signs are appearing that the housing market may be losing some of its heat and heading, if not for a slowdown, then at least for a period of stability. The market does need this as it will greatly help the first time buyer who has been finding it difficult to keep up with rapidly rising prices and competition from the buy-to-let sector."