Property sales fall by more than a third

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The number of homes sold in England and Wales has fallen by more than a third over the past year, government figures show today.

The Land Registry said 159,116 properties changed hands during the first three months of the year, 35 per cent down on the 243,914 sold during the same period of 2004.

The falls were steepest in the South of England, where prices have rocketed to unaffordable levels, and in Wales, which witnessed a runaway price boom last year.

The biggest drop was a 36.9 per cent fall in Wales while the South-west, South-east and Greater London all experienced 36 per cent drops. This compared with a 29 per cent decline in the North of England

A similar picture was seen in London, with sales in the capital falling by 36 per cent to just 20,788, as the housing market slowed down.

In some boroughs the number of transactions halved, with the steepest falls seen in sales of pricey detached homes.

The fall in activity appeared to feed through to prices, with house price inflation slowing to a three-year low of 10.27 per cent, well down from the peak of 22.2 per cent at the end of 2002.

Since the start of the year the price of the average home has risen by just 0.3 per cent, or £566, to £183,486. This appears to confirm the view of Halifax, the UK's largest mortgage lender, that prices have showed "no movement" since the start of the year.

The report is the latest to point to growing pressures in the housing market. Last week government figures showed that the number of court actions for repossession had hit its highest level for at least a decade.

However, figures from the Office of the Deputy Prime Minister showed annual house price inflation in the UK increasing to 12.6 per cent for the year to the end of March, up from 10.5 per cent in the 12 months to the end of February.