Largest ever drop recorded in Britain houses' asking prices

Asking prices of property coming to market decreased by 2.9 percent month-on-month in August, according to a survey from Rightmove Monday, marking the biggest fall the company has ever recorded.

This month's fall has caused a slowing in the annual rate of price growth to 5.3 percent in August from 6.5 percent a month earlier, property website Rightmove said.

Asking prices usually fall in summer but the latest data was steeper than expected.

London houses asking prices fell for the third consecutive month, dropping 5.9 percent between July and August, much more than the typical fall in what is usually the quietest month of the summer for the housing market.

There were two reasons for the drop in August, said Miles Shipside, Rightmove director and housing market analyst.

Firstly, both buyers and sellers were becoming increasingly aware about personal finances, given that the cost of mortgages were going up and regulators were trying to bring availability down, said Shipside. This limits what buyers were willing or able to pay, and helped moderate sellers price expectations.

The second factor was the turnaround in London. Having forced national average prices up for the last two years, it was now pushing them down with three falls in a row, said Shipside.

Besides, stricter rules on mortgage lending and expectations of interest rates rising from their record low were also factors.

"There are signs the market is effecting its own natural slowdown without (an interest) rate rise, though underpinned by greater awareness among the public that the five-year holiday of record low interest rates is coming to an end," Shipside said.

Rightmove plc is a Britain-based company that runs an online real estate portal. The Company was created in 2000 as a joint venture between four British property agents. Rightmove plc floated on the London Stock Exchange on March 2006.