House prices edged ahead by just 0.1 per cent during June as demand from buyers stalled, research indicated today.

Estate agents in England and Wales reported a 0.1 per cent rise in buyer registrations during the month.

Falls in demand were recorded in six out of 10 regions, according to property intelligence group Hometrack.

But the number of new homes coming on to the market continued to increase, rising by 2.9 per cent, further easing the mismatch between supply and demand.

The group said the supply of homes for sale had increased at three times the rate of demand since March.

It said a combination of the general election, pre-Budget talk of austerity measures and the ongoing mortgage shortage had all contributed to uncertainty in the market.

Richard Donnell, director of research at Hometrack, said: “We expect demand for housing to slow further as seasonal factors come into play and households consider the implications of the Budget on their finances and on the economy in general.”

The number of sales agreed continued to rise during June, despite the fall in demand, increasing by 2.8 per cent.

The amount of time a property takes to sell remained unchanged at an average of 8.4 weeks, while homeowners are achieving an average of 94.3 per cent of their asking price.

The average home in England and Wales now costs £158,900, 2.1 per cent more than in June last year.

But only 11 per cent of postcode areas saw a price rise during June, down from 25 per cent in February.

However, Hometrack said as long as estate agents could see that sales were still taking place, there was no real impetus for them to reduce asking prices.

Mr Donnell said: “Despite our view that demand is set to weaken in the coming months, price falls are only likely to feed through once sales volumes start to fall back.

“It is when this point is reached that prices will need to adjust to a level where volumes can be maintained.”