House prices stall at £160k

In England, the average fell to £169,567, in Wales £111,196, in Scotland £98,672 and in Northern Ireland £101,832, according to the Office of the Deputy Prime Minister.

London continued to have the highest house prices, averaging £241,385, followed by the South-East at £214,385, despite reports of price falls in both regions.

During November, the average firsttime buyer paid £124,346 for a property, while those moving from other houses paid £183,103.

John Prescott's office said the slump was caused by a combination of the market slowing in the the run-up to Christmas and some price drops in the

9.7 per cent.

South. The findings contradicted those of the country's leading mortgage lender, the Halifax, which said prices rose by a total of 15.4 per cent last year, including a one per cent increase in November.

The last time the lender saw any fall was in the mid-1990s. A spokesman added: 'We are forecasting an increase of eight per cent in houses this year.

'But in 2003, prices rose by 15 per cent, which means the market is slowing down gradually.

'We've been through a period of high growth and this can't go on indefinitely, so you need house prices to slow down so people's salaries can catch up.'

Bradford & Bingley also predicted a slowdown this year.

Spokesman David Bitner said prices would rise only in single digits because people's income growth failed to match the steep gains in house values seen in recent years.

But he added: 'I don't think a slowdown, as we normally experience in November and December, is any great concern.'