House prices fall continued in July according to the latest monthly report from the Halifax.
The lender said prices fell another 1.7% last month, taking the annual rate of decline down from 6.1% to 8.8%.
The Halifax calculates that the average house in the UK is now worth £177,351, back to the value seen in June 2006.
The bank said demand from home buyers had been “significantly curbed” by the lack of mortgage funds, high prices and the squeeze on household finances.
“Pressure on householders’ income, together with a very significant reduction in mortgage finance due to the global financial markets crisis, is constraining potential house buyers’ ability to enter the market,” said the Halifax’s economist Suren Thiru.
“This is resulting in both lower prices and activity levels,” he added.
The Halifax’s survey chimes with that of rival mortgage lender Nationwide, which recently calculated that UK property prices had fallen by 8.1% in the year to July.