The number of properties being put up for sale has soared by 25% year on year as sellers become more realistic about how much their homes are worth, according to new research released by the National Association of Estate Agents (NAEA).

The average estate agent branch had 70 properties on its books in February, up from just 56 a year earlier and the rise in sellers suggests there is either renewed confidence in the market or panic that prices will fall further.

However, the NAEA report that there are now signs that people were being more realistic about the price at which they should market their home.

The rise in sellers was matched by a further increase in buyers, with the average estate agent having 268 registered buyers, the third consecutive increase and the highest level for seven months.

The NAEA said the rise in sellers meant the supply of property was able to keep up with renewed demand, which should lead to some short-term stability in the market. But over the longer term it warned that it could put downward pressure on prices.

There are also concerns that interest rate rises, as well as Government spending cuts, will hit consumer confidence during the coming months. The number of agreed sales rose slightly during February, with the average branch selling eight properties, up from six in January and above the recent average for the time of year.