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Written by rosalind renshaw

A surge of new sellers coming to the market and a crippling of demand due to the mortgage drought has led to agents being stuck with more unsold properties.

This morning, Rightmove reported a ‘sharp’ rise in unsold stock, whilst across the country, asking prices rose just 0.7% over the last month.

In London, the surge of stock means there are double the number of new properties on the market compared with this time last year – 4,170 as opposed to 2,110. In London, asking prices fell slightly, by 0.4%, compared with April prices.

Miles Shipside, commercial director of Rightmove, said: “Potential buyers remain in a difficult position.” He said they were being “marginalised” by lenders continuing to demand large deposits and high credit worthiness.

He said first-time buyers and property investors were “particular casualties of the finance famine”.

Calling the housing market broken, Shipside said that rising stock levels and rising house prices made for unhappy bedfellows. “We are seeing signs that the relationship is under increasing stress,” he said.

He said of the imbalance between sellers and purchasers: “The market has to either operate at reduced sales volumes or hope that sellers can sell to each other, forming circular chains by trading up and down. This is a much more inefficient model, with less chance of sales success and longer lead-times.

“While new stock levels remained low, this inefficient market was able to maintain prices as long as supply broadly matched demand. With more sellers now marketing, this uneasy equilibrium is in danger of becoming unbalanced. There aren’t enough ready-and-able buyers to soak up a surge in fresh stock.”

Over the last month, Rightmove has been recording in excess of 30,000 new listings a week. The last time this happened was in the week starting June 28, 2008.

It puts the amount of unsold stock per agency branch at 71.

However, it would appear that asking prices have a very long way indeed to fall. The average asking price on Rightmove is £237,134. But according to Halifax, the actual average selling price is £168,202 and according to Nationwide it is £167,802.

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