Home sellers will have to cut the price of their properties or work harder on making them appeal to buyers if they want to get them sold, according to the head of Foxtons.

The London-based estate agency suggested higher interest rates will inevitably push asking prices down, as a growing disparity between sellers and buyers’ price expectations adds to the usual summer slowdown.

Guy Gittins, chief executive of Foxtons estate agents in London, said the “power balance” between buyers and sellers had “shifted”. He said this meant “serious sellers had to get a little bit more competitive with pricing”.

His comments came after the chancellor, Jeremy Hunt, said yesterday that the UK has “no alternative” but to hike interest rates in a bid to tackle rising prices.

Hunt, who insisted that inflation was the “number one challenge we face”, said the government would be “unstinting in our support” for the Bank of England “to do what it takes” to slow inflation.

Rising interest rates and mortgage costs weighed on UK economic growth in April.

While the economy grew by 0.2%, the Office for National Statistics said that estate agents and housebuilders had a “poor month”.

Borrowing costs have been steadily rising since December 2021 to a current 4.5% in an attempt to slow consumer price inflation, which stands at 8.7% – well above the Bank of England’s 2% inflation target.

An increase in interest rates means higher monthly mortgage, credit card and loan payments for some people.

Hunt added: “In the end there is no alternative to bringing down inflation, if we want to see consumers spending, if we want to see businesses investing, if we want to see long-term growth and prosperity.”