House sales plunge in 3-year slump

There were 869,000 homes sold in 2011, down from 880,000 in 2010 and continuing a three-year slump, the UK transaction figures show.

The lowest figure in recent years was in 2009, when just 848,000 homes were sold, amounting to roughly half the number of transactions before the financial crisis hit.

Concerns have been raised that sales could hit another record low this year, and the Bank of England recently said it expects lenders to tighten their credit criteria this year, making it harder for borrowers to get a mortgage.

The stamp duty holiday for first-time buyers is also due to end this spring, with that sector of the market having made a slight recovery in recent months after hitting a three-year low last autumn.

Geoff Meen, professor of economics at the University of Reading, told the BBC: "If you have very poor levels of credit availability for first-time buyers and people moving home, you are going to get low levels of sales taking place."