UK house prices fell by around two per cent during the five weeks to August 14th, a new survey claims.
A report by property website Rightmove revealed that homeowners saw almost £4,000 wiped off the value of their properties during the period.
The price of an average British home now stands at £192,335, down from £196,198 on July 10th.
The biggest price drops were recorded in Wales (6.8 per cent), followed by Greater London (4.3 per cent) and the east Midlands (2.8 per cent).
Falls in average asking prices of 2.4 per cent and 2.1 per cent were also recorded in the south-east and south-west respectively.
Rightmove suggests that the market was starting to respond to the higher costs of borrowing, with interest rates rising five times since November to stand at 4.75 per cent.
Miles Shipside, commercial director at Rightmove, said: "The Bank of England can't raise the cost of borrowing five times in nine months without something happening.
"While it took much longer than people expected, it is now hitting the housing market at the sharp end and asking prices have been declining in each of the last five weeks. Sellers are having to accept that the market has turned and that realism is the order of the day in setting their prices."
However, despite the price drops, Mr Shipside insisted it did not mark the beginning of a long period of plummeting asking prices.
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