But monthly drop is smallest recorded since last May, and fewer districts report price falls

House prices in England and Wales have fallen by 10.3% since this time last year, in spite of a slowdown in the rate of decline in March, according to property data company Hometrack.

The annual fall is the biggest yet recorded by the monthly survey of estate agents and surveyors, which has been going since 2000.

Hometrack said the average achievable selling price for March was £156,100, just 0.6% below February's figure. This was the smallest month-on-month fall since May last year but the organisation said this was largely due to seasonal factors.

Sale and let boards
The average achievable selling price for March was £156,100, and in London £274,700

There were other signs of improvement, however. The proportion of postcode districts reporting price falls dropped from 59% to 50% and sellers received 88.8% of their asking price on average – up from 88.3% in February.

But Hometrack director of research Richard Donnell warned that prospects for the year ahead remained bleak. He said: “With the expectation of continued increases in unemployment and weak economic growth, together with restricted availability of mortgages, it seems doubtful whether the increase in activity and sales will continue to gather momentum in the coming months.

“Prices look set to remain under downward pressure over the rest of 2009.”

London was the worst hit region in March, with selling prices dropping 0.8% to an average of £274,700.