House prices are rising in Sussex despite falling sales of homes and an economic slowdown.

Latest figures from the Land Registry show the number of homes sold in the county has fallen by more than a third during the last year, while house prices are still going up.

Experts say this is the result of the region's housing market finally levelling out after the "mini boom" of the last few years, which has seen house prices rocket.

They predict house prices will now begin to rise more slowly and possibly come to a complete halt, meaning sales would rise as confidence increases in the market.

The Land Registry compared prices from the first quarter of 2004 and the first quarter of 2005 and said prices had risen in all regions of England and Wales during the year.

Average prices are highest in London at £288,507, followed by Sussex and the South-East at £221,055.

In Brighton and Hove, the average price of a property rose from £189,896 in 2004 to £218,600 in 2005. But sales were down in the city from 1,613 to 977.

In East Sussex, the average price of a property rose from £187,514 to £200,598 and in West Sussex from £207,866 to £222,212.

Sales in East Sussex dropped from 3,110 to 1,880 and in West Sussex from 4,274 to 2,697.

Chris Oakley, president of the Brighton and Hove Estate Agents Association, said: "Generally, the steam from two years ago has gone out of the housing market and because of that fewer people are deciding to move, but property is still a very good investment.

"I think the level of transactions is still healthy. It was a mini boom two years ago and although the number of transactions has dropped quite considerably, it's coming off a very strong market so the figures are not alarming, they are actually quite encouraging.

"We have simply had a market correction and people are being more cautious about moving. Now house prices are rising at a sensible level rather than at the dramatic level it was before."

"Over the period of a year house prices have gone up by about 12 per cent in Brighton and Hove, which is a healthy return and the market place is still very active."