House prices in England and Wales fell by 0.8% in March, following several months of slowing activity, Land Registry figures show.
The latest data put the average price of a property at £178,007, 5.3% higher than in March 2014.
Recent months have seen a fall in mortgage lending and inquiries from prospective homebuyers. The Land Registry said transactions had fallen in the three months to January. Compared to the same period a year earlier, sales were down by 18% at an average of 71,090 a month.
The figures, which are based on sold prices for homes that have changed hands more than once, show that prices fell during the month in eight out of 10 regions.
Rises were only recorded in the south-east of England, where homes fetched 0.8% more than in February, and in London, prices were up by 0.2%. In contrast, the north-east of England saw a 4% fall.
The annual rate of price increases remained in double figures in the south-east and London, but were more muted in other regions, and in the north-east prices were down by 2.9% year-on-year.
In a sign of how divided the housing market has become, while the average price of a property in London hit its highest-ever level of £462,799, in the north-east homes changed hands for an average of £97,444, well below their pre-crisis peak.
Matthew Pointon, from Capital Economics, said that despite “a not insignificant fall” in March, the Land Registry figures showed prices were higher in the first quarter of the year than in the previous quarter.
“Overall, therefore, the Land Registry figures are broadly in line with other measures of house prices showing a steady rise since the start of the year,” he said.
“That rise reflects both a strong economic backdrop and tight market conditions, with very low numbers of homes on the market.”
Of 32 London boroughs, 30 have recorded double-digit price growth over the past year. The biggest leap in prices has been in the south-east borough of Newham, where prices were up by 19.8% at an average of £291,364.
In Kensington and Chelsea, where concerns about a possible mansion tax after the election are likely to be strongest, the annual rate of growth fell to 5.2%, its lowest level in four years. The average price of a home in the borough is now almost £1.3m.
The market for homes costing more than £2m, where Labour’s planned mansion tax would kick in, has slowed, with sales down by 22% in January compared with the same month of 2014.
However, a larger fall was recorded in the market for homes costing between £1.5m and £2m, where sales dropped by 26%, suggesting that stamp duty changes that came into effect in December and added to the cost of buying a home costing more than £1m have dampened sales.
Guy Meacock, from buying agency Prime Purchase, said: “There is panic in the housing market as a result of the culmination of many different tax changes coming together. A possible mansion tax and fear of the unknown is playing a big part, although the recent stamp duty changes arguably have had a much bigger impact on the top end of the market.
“A Labour/SNP coalition will soften the market but in terms of buying now it is still a good time as there is less competition and more room for negotiation.”