The Land Registry said just under than 230,000 houses were sold in England and Wales in the final three months of last year compared with more than 301,000 in the same period in 2003 - a fall of 24 per cent.
Housing experts said the Registry's figures bore out anecdotal evidence from estate agents of a sharp slowdown in activity in the second half of last year as the property market cooled. The decline in transactions brings activity back towards what it was a decade ago, after the housing crash of the early 1990s.
Miles Shipside, of the property website Rightmove, said: "The fall in prices is one thing, but the large fall in volumes tells a bigger story than the decline in prices. There have quite simply been far fewer buyers in the market over the last six months or so. The Land Registry is now reporting transactions that were agreed in late summer or early autumn of last year and we can expect their next set of figures to show a further decline in volumes and prices."
The average sale price in England and Wales rose 11.82 per cent to pounds 182,920 year on year, the Registry said. In the previous year the increase was 12.62 per cent. In Greater London the price rise was half the national average at just 6.15 per cent and in the City of London, the Registry said that house prices fell nearly 11 per cent.
Despite the slowdown in activity, there was continued growth at the top end of the market, with the number of houses being sold for more than pounds 1m rising from 760 to 765. However, the growth took place outside of Greater London where the number of pounds 1m-plus house sales fell from 469 to 436.
Blaenau in Gwent recorded the sharpest increase in prices with the average house being sold for pounds 83,688 - a rise of 65 per cent on the final quarter of 2003. Hartlepool took the wooden spoon with a 6 per cent drop in the average sale price to pounds 76,132.Reuse content