Sky-high prices and a shortage of first-time buyers have been blamed for a renewed fall in the property market in Sussex.

There has been a 0.2 per cent drop in house prices across Sussex in the past month.

A report released by property web site Hometrack shows average prices have dropped from £183,800 to £183,400 in West Sussex and from £153,100 to £152,800 in East Sussex.

The number of first-time buyers climbing on to the property market has dropped by 40 per cent in the past 12 months, triggering fears of a collapse in values.

The findings could mean thousands of families across Sussex will be forced to stick with homes they cannot sell.

Mark Lane, of Hometrack, said: "The lack of first-time buyers is certainly a factor. If people in smaller flats can't sell, they can't upgrade so it causes problems throughout the market.

"With earnings falling, many people are struggling to buy after the huge price increases in the last few years. Until there is more confidence there is not going to be a market upturn."

Terraced houses in Brighton and Hove are now the third most expensive in England and Wales, outstripped only by Greater London and Windsor.

Yet the average household income in Brighton and Hove is less than £20,000.

Council worker Donna McClements, 33, of Norfolk Square, Brighton, wants to buy her own house but fears she may have to move out of Sussex or carry on renting.

She said: "I've always rented and feel it's now the time to move house. But even a bedsit is out of reach for me on my local authority salary.

"So I have to choose if I want to stay in Brighton and rent."

Chris Spratt, of the Royal Institution for Chartered Surveyors, said: "Certainly one of the reasons for the housing market slowing must be the absence of first-time buyers."

However, Glenn Mishon, director of Mishon MacKay estate agents, said there was no need to panic.

He said: "You can now get a one-bedroom flat in Brighton for £110,000 to £115,000. Before you couldn't get one for under £125,000 to £130,000. However, I don't think that has moved through the market place."