The time taken for houses in Edinburgh to sell has risen to an average of 100 days, according the Edinburgh Solicitors' Property Centre (ESPC).

The Centre’s report on the state of the housing market in Edinburgh shows that only 400 sales were completed in August 2008, compared to 985 in the same month the previous year.

The report also shows that there has been a 6.5 per cent fall in the average house price, which now sits at £201,517.

Speaking to the Scottish Parliament’s Economy, Energy and Tourism Committee, Ron Smith, chief executive of the ESPC, told MSPs that this was a marked increase from the 70 day average for August 2007, adding that the fall in house prices could grow to 8 per cent in September.

In his presentation to the committee, Mr Smith said: “The greater decline in sales year-on-year is around 60 per cent in greater Edinburgh in August.

“Because of that falling sales number it is now taking on average up to 100 days to sell a property; we’re sitting on a stock of around 6500 properties for sale, which is 60 percent higher than we would normally expect at this time of the year in a normal year.”

This is likely to affect students at Edinburgh’s universities, coming in the same week as reports that many homeowners finding it difficult to sell their properties are turning to the rental market.

Many experts predict that lower rental prices could follow a flood of properties to the Edinburgh letting market.

Steven Currie, joint head of Murray and Currie estate and letting agents told the Edinburgh Evening News: “In November and December there will be a saturation of flats [to rent] as people can’t sell.

“The market is great just now but there are hard times ahead and people need to prepare for that.

"People will be seeing what’s going on in the property market and thinking of a plan B. That plan B is to rent.”