HOUSE prices in Oxfordshire have finally started to tumble, with experts reporting a marked slowdown in activity in the last few weeks.

According to Government statistics, more than £3,000 was cut from the average price of a property in the county between the peak in March and the latest figure for May.

And Mark Charter, residential partner at Summertown-based estate agent Carter Jonas, believes the slowdown increased in June.

He said: "Since the beginning of June, the market has been much quieter.

"The slowdown started in London at the end of last year and that is what we are beginning to see locally. We are all feeling poorer, costs are going up and everyone is sitting still and taking stock."

Mr Charter predicted prices would continue to fall over the next 12-18 months, despite the feeling that the county is better placed because of the buoyant local economy with demand from jobseekers and academics moving to the area.

He added: "We all talk Oxfordshire up but it is not an island and the market is underpinned by London. If people can't sell there, they can't buy here."

Latest Oxfordshire figures from the Land Registry show the average price of a property in May was £250,402, a drop of 1.2 per cent on the March high of £253,534.

Nationally, the Nationwide Building Society said the average cost of a home in the UK slid 0.9 per cent in June to £172,415, while annual house price inflation slumped to minus 6.3 per cent, the lowest level since December 1992.

Recent figures from the Bank of England also show mortgage approvals for house purchases have slumped to a record low - 42,000 new loans were approved for people moving during May, 28 per cent below April's level and 64 per cent down on the figure for the same month of 2007.

Ronnie Van Der Ploeg, associate director of Oxford-based property agent Savills, said: "People who have had agreements in place with the banks eight weeks ago are having to re-negotiate and companies such as Northern Rock just don't want the business.

"People still want to buy but they are having to do their sums carefully."

Robert Maxwell, branch manager of Andrews estate agents in Cowley, said property was still selling in Oxford as long as it was realistically priced.

He added: "The number of properties we are dealing with has not changed but the asking prices are less.

"If the price is right then the buyers are there but people are having trouble finding a mortgage, especially first time buyers."

Melanie Bien, director at mortgage broker Savills Private Finance, which has an office in Botley, said those most likely to obtain a decent rate of interest on their mortgage would have a large deposit and a clean credit history.

She added: "Those in a strong position have significant equity in their home of at least ten per cent and have not missed a payment on their bills. They will have a choice of rates.

"Lenders are pulling rates, there are fewer products and they are more expensive. First-time buyers will be paying the highest premium."