Hometrack see fastest fall in house prices for three years

October saw the steepest fall in house prices since September 2001 and the fourth consecutive monthly contraction.

12:02 25 October 2004

October saw the steepest fall in house prices since September 2001 and the fourth consecutive monthly contraction.

The monitoring company Hometrack has announced that asking prices fell by 0.6 per cent while the average house now costs 165,800.

"House prices are likely to drop further over the next few months due to the current excess supply and the expected seasonal fall off in the number of prospective buyers," explained Hometrack's John Wriglesworth.

However, he added: "House prices will not plummet into an abyss as some of the doomist commentators have been predicting."

The decline in prices and the amount buyers are willing to pay - 94 per cent of the asking price on average - has affected the entire country.

The Hometrack survey also found that the south has experienced the most dramatic contractions.