London property market 'slowing'

London house prices dropped at their fastest rate in more than two years last month, according to the latest figures from the Land Registry.

Prices were down by 0.6% in October, the first monthly decline in the capital since April 2006 and the sharpest drop since August 2005.

Rises in most other regions meant prices climbed by 0.1% across England and Wales as a whole.

But analysts fear weakening prices in London could threaten the wider market.

Slowdown

The Land Registry said it is the first time in ten months that the London market has been outperformed by England and Wales as a whole.

Despite the fall, the capital continues to have the strongest rate of annual price inflation of any region at 14.7%, but that is down sharply from an annual rate of 16.5% recorded in September.

The average property price in London is now £351,039, down from £354,272 in September.

Across England and Wales annual price inflation now stands at 8.1%, the lowest figure since last December. It puts the cost of an average house at £184,346.

A number of recent surveys - including those from the Royal Institution of Chartered Surveyors (Rics) and property group Rightmove - have shown London to be the only region showing consistently strong price growth.