Its House Price Index revealed that the average house price drop in England & Wales fell 0.3% from August to September and is down 2.3% on the year. Transactions meanwhile increased 9.5% from last month.
The Greater London area continued to be the only region able to maintain a positive average annual house price change at 1.1%.
The greatest house price fall was seen in the North with a decrease of 2.1% in monthly house prices and a 6.7% decrease annually.
David Brown, commercial director of LSL Property Services, said: “Outside London, prices are falling throughout England and Wales and this has contributed to a fall in the average house price of 2.3% in the last 12 months.
“This looks like bad news for property owners, but over the medium term, despite short-term fluctuations, the property market has been stable.”
LSL’s Houser Price Index showed that in September 2011 there were 66,500 transactions, up 14% from September 2010.
Brown added: “It’s certainly not all doom and gloom for homeowners. Buyer activity is picking up as transactions have been much higher than we would normally expect at this time of the year. This is important because it shows the market is not on a course for terminal decline.
“Increasing activity means buyers currently feel properties represent good value and that shows there is still plenty of confidence among both buyers and mortgage lenders that prices won’t plummet in the coming months. Add to that the fact that mortgage finance is currently cheaper than ever before, and there are plenty of positives to focus on when assessing the market.
“That’s not to say the road to recovery is obstruction-free. Mortgage lenders’ willingness to lend at record low rates is based on expectations that the MPC will keep rates low for the foreseeable future and that the Eurozone crisis won’t become a disaster.
“While it’s probable these conditions will continue, it’s far from certain. But whatever the future holds for the wider economy, buyers and remortgagors know that locking in to a cheap fixed rate deal now gives them the best chance of securing their financial futures and getting onto the property ladder.”