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The figures from Nationwide Building Society show that since this time last year, house prices have now fallen a total 14.6 per cent making the average house price now £158,872, a drop from £186,044 a year ago.

Fionnuala Earley, chief economist for Nationwide, said: "House prices in the UK fell for the twelfth consecutive month in October. The price of a typical house is now 14.6 per cent lower than at this time last year, the peak of the market.

The typical house price fell by 1.4 per cent in October, around the same rate as the average monthly fall of 1.3 per cent over the last year, but lower than the monthly falls recorded in each of the previous three months.

"The price of a typical house is now £158,872, almost £30,000 less than a year ago, but to put in context, still almost £30,000 more than five years ago."

According to Earley, the path of house prices is closely related to movements in the numbers of transactions.

She said: "House purchase approvals dropped to new lows in the third quarter of the year, at around one third of the long run trend. The number of completed house purchase transactions as a proportion of the total stock of mortgages is now at its lowest ever level since the series started in 1974.

"It takes an average of almost 12 weeks to sell a property now compared to 7.4 weeks this time last year. In some ways this lack of activity is puzzling given that the last time turnover rates approached this level was in the early 1990s when market conditions appeared more hostile," she said.

According to Earley, one possible explanation is that it is only those sellers willing to negotiate on price that are seeing sales go through. While others refuse to cut their price, the levels of activity are constrained.

"This type of stalemate ultimately limits the number of transactions which can take place.

"This could however indicate that conditions are not yet very stressed, as sellers have not felt the need to dramatically reduce their prices for a quick sale."

Looking ahead, Earley also expects house prices to continue to fall well into 2009.