Mubasher: House prices in London fell at their fastest pace since the financial crisis a decade ago, as the megacity took the hardest blow from the UK dormant property market.

The price of a house in London was 4.4% lower than in May, compared with the same month last year, , a joint statement by the Office for National Statistics (ONS) and the Land Registry showed on Wednesday.

This was the biggest drop in London house prices since the 7% annual drop in August 2009.

Overall, UK house price inflation declined to 1.2% last May, compared with the 1.5% in April, with the biggest price gains seen in the North West and the West Midlands at 3.4% and 2.7%, respectively.

Despite a prolonged period of low interest rates, London house prices, the highest in the UK, have been affected by a number of factors, including the difficulty first-time buyers face in affording prices.

The average cost of a home in the UK came in at GBP 229,431 ($285,685) last May, GBP 2,000 higher than the price a year ago, while the figures showed wide regional gaps, from GBP 457,471 in London to GBP 134,811.

UK house price inflation is below the official headline gauge of the cost of living, which remained at a target of 2% last May, the ONS said.

By 12:15 am GMT, the GBP/USD pair edged up by 0.05% to $1.2413, while the EUR/GBP pair ticked down by 0.01% to GBP 0.9035.