House prices have fallen in February for the fifth month in a row, deepening the gloom over the property market.

The average price of a new property decreased by 0.2 per cent to £174,400, according to Hometrack, the property research group. The annual rate of house price inflation fell to 1.4 per cent, its lowest in nearly two years.

The number of purchasers paying the full asking price dipped to 93.3 per cent, from 93.5 per cent in January, suggesting that the market was turning in favour of buyers. The time taken to sell a property was unchanged at 8 weeks, which was the longest since Hometrack's survey began in 2001.

The 8 per cent rise in February in the number of new buyers registering with agents was well down on the 25percent increases recorded in the same month in the previous two years.

Richard Donnell, director of research at Hometrack, said: “The increase is well down on levels expected for the start of the Spring market.”

The volume of properties on sale rose by 8.2 per cent, reversing the falls in January and December, but Mr Donnell said that it was too soon to talk of a recovery.

“While we expect demand to continue to improve in the coming months, it is too early to talk of a major turnaround in the fortunes for the housing market. A small but growing number of buyers appear ready to dip their toes in the market again, but any upward pressure on prices is likely to remain limited for the foreseeable future,” he said.

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