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Nationwide made its warning after it was revealed the average price of a home now stands at £15,000 lower at the same time last year.
Indeed, house prices are no at a three-year low of £169,316, reports the Times.
Fionnuala Earley, chief economist at Nationwide, said the risk of a recession hitting the UK was rising.
She commented: "If oil prices continue to fall and the monetary policy committee is satisfied that its inflation credentials are intact, the possibility of earlier rapid cuts in interest rates increases, which would be good news for borrower."
Figures released recently by the Land Registry confirmed that year-on-year increases in UK house prices all but ground to a halt in June.
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