More than 80% of properties on the market are out of the price range for families looking to purchase their first home, research from Shelter reveals.
The cost of a typical UK home edged up by just 1% in April but was the largest monthly increase seen since June 2014, Nationwide's index revealed.
Brits are exacerbating the problem of housing supply shortage by overconsuming existing stock, according to the chairman of the Council of Mortgage Lenders (CML) Moray McDonald and leading housing economist Dame Kate Barker.
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The housing market lull has continued in March, with the market described as the slowest since 2013.
House prices in the UK are expected to rise by 1.5% during 2015, the Centre for Economics and Business Research has predicted.
House prices in March were 8.1% higher than at the same point a year ago, figures from Halifax have shown.
UK sellers are listing properties at significantly higher prices than the actual sale price achieved, according to online estate agent emoov.co.uk.
The past year has seen a deterioration in house price affordability in UK cities so much that average affordability is back at 2009 levels.
Brits in their 20s and 30s will own fewer properties in their lifetimes due to rising house prices and lack of suitable homes.
The average house price in England and Wales is now just £831 under the peak price of November 2007.
House price optimism rebounded in February, according to the Halifax Housing Market Confidence Tracker which surveys how people feel about the housing market.
UK house price growth dipped to 8.4% in the year to January 2015, down from 9.8% in the 12 months to December 2014, Office for National Statistics (ONS) figures show.
First-time buyers are being pushed out of the housing market as average UK house prices exceed the rate of pay in a number of regions, Halifax research finds.
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