House prices rose by 1.2 per cent in February, despite nine out of ten movers saying it was a ‘bad time to sell’.

The Rightmove house price index (HPI) found ‘falsely optimistic new year sellers’ were raising asking prices an average of £2,593 higher than January, perhaps down to the increasing lack of housing stock.

Estate agents competed for nearly 63,000 fewer sellers than last February, with the annual fall rate in asking prices seeing the largest decrease Rightmove has ever recorded, at 9.1 per cent lower than those a year ago.

January enquiries were up 108 per cent on last year, setting a new Rightmove record and indicating a pent up demand to move home. However, Rightmove said this was probably down to buyers ‘testing the water’, as some agents reported 40 or 50 viewings a weekend were resulting in no offers.

Miles Shipside, commercial director of Rightmove, said: “In spite of 25,000 out of 28,000 potential homemovers in the Rightmove survey stating it was a bad time to sell, sellers appear to have ignored their fellow homemovers’ assessment of market conditions and put prices up.

“While sellers have been more conservative in their New Year bullishness than last year, they may regret not pricing more aggressively to capitalise on the spring surge in buyer interest.

“New sellers are 45 per cent down compared to February last year. In spite of these being ideal trading-up conditions, discretionary sellers are being deterred by uncertainty over mortgage finance and employment, while pending repossessions were delayed by an informal Christmas amnesty.

“Estate agents always deal with a vast number of enquiries, often needing to register 100 applicants for every successful sale. However, current pent-up demand is being frustrated by banks, building societies and, indeed, the taxpayer contributing insufficient funds to potential borrowers.

“That leaves a shrinking number of lenders who are cherry-picking the most credit-worthy borrowers, whilst arguing amongst themselves as to who is to blame for this crisis as opposed to solving it.”