Lack of mortgage finance is continuing to influence falling house prices in the UK, an expert has said.

Douglas McWilliams, chief executive of cebr, was commenting after data from the Chesterton Humberts' cebr house price poll of polls showed that house prices hit a 15.3 per cent year-on-year slump in January.

The statistics showed that the average home in England and Wales now costs £167,751 - the lowest level since September 2005 - after falling 1.7 per cent last month.

Mr McWilliams commented: "The ongoing lack of finance is the fundamental issue."

The figures suggest that private landlords with buy-to-let mortgages might still be taking advantage of low house prices and increased demand for rental accommodation.

Your Move recently reported a 63 per cent increase in rental demand in December 2008 compared to the same month a year earlier.

This was attributed to a growing number of would-be homebuyers being forced into renting because of the current difficulties in securing mortgage finance.ADNFCR-2002-ID-19016626-ADNFCR

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