The Royal Institution of Chartered Surveyors (RICS) announced that 49.1% more surveyors recorded a price fall than rise in December 2007.

This is the most worrying figure since the poor performance in 1992. The prices have been hit by interest rate raises and higher lending criteria.

The credit crunch means many borrowers will resort to taking out a secured loan, which these figures suggest may get them a lower sum than previous years.

The latest research from the Halifax bank and the Nationwide building society suggested the market weakened further in December and mortgage approval levels also fell to a three-year low the month before.

According RICS, December was the fifth consecutive month of falling house prices along with 25% more surveyors reporting a fall in the number of people looking to buy a new house.

"The housing market is clearly feeling the pinch from the credit crunch and the round of interest rate hikes in 2007," said Rics spokesman Ian Perry.