“What we need is for lenders to loosen the purse strings and that’s why the news from the Halifax is welcome.”

Halifax’s decision to slash rates on its three- and five-year fixed and tracker deals means customers looking to remortgage will now pay up to £200 a year less on an average £100,000 mortgage.

The cuts follow the lead of the Nationwide Building Society and Abbey, which reduced rates last week.

In further good news, the latest house price index – based on information from five major UK house value surveys – showed annual growth remained steady at 1.7 per cent last month.

Although, down from 3.6 per cent in March, the figure shows that house prices are still up on last April.

The typical house in the UK is now valued at £211,014, down from a high of £215,089 six months ago. But annually, the typical home owner would have seen the price of their home rise by £2,279 since April 2007.

Stuart Law, of Assetz House Price Index which carried out the research, said: “I am yet to see any firm evidence of a housing market crash. Values in this country have remained extremely robust in spite of the difficulties in the mortgage market.

“With announcements from some mortgage lenders that they are now reducing their rates, movement should return to the market and we should return to a degree of normality, perhaps as soon as September.”

Peter Bolton King, chief executive of the National Association of Estate Agents, also predicted an upturn in the market in the second half of the year.

He said: “There is no housing crisis, we have no credit crisis. If anything, we have only a crisis of confidence in the market.

“We just need a couple of good deals offered by lenders and people will start to borrow and buy again.”