House prices in England and Wales have fallen for the first time in more than two years, according to the Royal Institution of Chartered Surveyors (RICS).

The institution blamed the prospect of war and continued economic uncertainty for February's slide, which, while relatively modest, was still the largest recorded drop in eight years.

London was the hardest hit, with prices falling at their fastest pace for almost a decade, followed by the South-East.

But the falls have not yet rippled out to the northern regions, Wales and the East Midlands, all of which recorded firm price growth.

RICS housing spokesman Ian Perry said: "The faltering housing market has come in response to growing fears about the situation in Iraq.

"The survey shows one of the last bastions of economic endurance is no longer able to sustain growth in the face of a looming war and the economic uncertainty it has brought about.

"While the fall in home prices certainly represents a setback for the market, there is no indication at the moment that the downturn will be long lasting."

During the three months to the end of February, ten per cent more surveyors reported seeing a drop in prices than those who reported a rise.

This compared with 22 per cent more surveyors reporting price rises than those who said they had seen falls in the previous month's survey.