House prices in Oxfordshire are tumbling at an annual rate of 3.8 per cent, according to figures released by the Land Registry.

The average price of a house sold in the county in September was £241,444, compared to £250,363 for the same month in 2007.

Between August and September this year, the figure slipped by 0.6 per cent as the rate at which prices are falling increases.

But Oxfordshire still compares well with figures for England and Wales as a whole, which saw an eight per cent annual average house price fall to £168,814.

Account manager Louis Burford, 25, has been trying to sell his flat in Abingdon for five months.

He said: "A few more viewers have come along to see the flat in October — and when interest rates come down, as expected, that will help too."

He bought his two-bedroom flat, in Penlon Place, for £210,000 in March 2006 and put it up for sale at £225,000 in June.

In September, he reduced the price to £219,000.

Mr Burford said: "I am not desperate to sell, but I thought that if I could I would — and then live with my father until I could find a house, rather than a flat, to buy.

"I am very sorry for people who now find themselves in negative equity.

"Part of the trouble in Abingdon is there are a lot of new-build flats for sale and some developers are offering incentives with which I cannot compete — stamp duty paid for buyers, for instance."

Lawyer Mike Dibden, head of the conveyancing team at Oxfordshire law firm Brethertons, also suggested some "clever money" might once again be going into the county's property market.

He said: "The market is still very fragile, and it's too early to call this a trend, but we have seen an increase in the number of conveyances we are handling this month.

"It could be some people who have sold equities on the falling stock market are now putting their money into property instead."

He said the number of transactions in October was up about 10 per cent over September levels — but stressed many of the new conveyances were for properties at the top end of the market.

Mr Dibden said the freeze in the housing market had two causes — potential buyers finding it impossible to get credit and potential cash buyers holding off in case prices fell further.

"There are signs some of these cash buyers think now is the right time to make a move," he said.

The Land Registry figures, which were released yesterdayalso showed there were 580 house sales in Oxfordshire in July, up from a low of 533 in March.