Average house prices in Sussex have dropped for the 11th month in a row, according to a report out today.

But the survey by Hometrack shows sale prices are beginning to stabilise.

Values across the county dropped by 0.2 per cent in May, slightly less than the previous month.

Homes in East Sussex cost £181,700 on average, compared with £223,800 in West Sussex.

In Brighton and Hove it is the first time values have not decreased in more than a year. In the city, the average house price of £160,000 was unchanged throughout May. It is one of 34 cities where values have remained static.

In the last decade properties have been known to increase by as much as 20 per cent a year in Sussex and the slow-down is being seen as good news for first time buyers and people who were being priced out of the market.

Property prices in towns such as Shoreham, Bexhill and Hastings are still on the increase as buyers are forced out of cities and larger towns.

Although prices have stalled the market is busy nationally and 7.6 per cent more sales were agreed this month compared with last year.

Graham Bull, director of residential property at Oakley estate agents in Brighton, said: "We are still finding the property market strong and trade is still very busy.

"Prices have stopped the drift downward we have seen over the last year.

"The key is of course interest rates. If they rise we will be adversely affected.

"Brighton and Hove has always been slightly different to the surrounding area because the city has always been regarded as a hot spot."

John Wriglesworth, an economist for Hometrack, said: "House prices are falling like drizzly spring rain, slowly over most parts of the country.

"While there is no sunny outlook in prospect, there are no signs of a gathering storm either. The forecast for the next couple of months looks set to remain dreary.

"All the market needs is a spark of consumer confidence which will extinguish misplaced fears of significant house price falls.

"The year looks set to end as it began in terms of house prices - as flat as a pancake."

Monday, May 23 2005