House prices in the island rose by 2 per cent last year to an average of just under £271,200.

But the average price of flats sold slumped by 15 per cent, from £172,157 to £139,430 over the course of the year - although this was partly due to a large increase in the latter part of 2015.

For both flats and houses sold, the average price was £249,150 in 2016, a fall of 0.6 per cent over the calendar year.

The figures are contained in the Isle of Man Housing Market Review 2016, which has just been released by the Cabinet Office’s economic affairs unit and is the first publication of its kind.

It brings together in one place a range of existing information about housing plus new information about house affordability.

Average house prices rose from £265,809 in December 2015 to £271,192 at the end of last year.

But median - midpoint - house prices changed little, from £245,000 to £245,500, over the same period.

In 2016 average house prices in the island were 7.61 times average annual earnings, the same figure as 2015. Over the longer term, prices are higher relative to earnings than they were during the 1990s but lower than they were in most of the last decade.

The earnings ratio for under-25s has improved since 2011, the review shows.

A spokesman for the Cabinet Office said in terms of housing affordability, the island would slot in at 182 out of the of the 348 local authority regions in England and Wales.

He said: ’Generally those above the island are London, South East and South West, and some of the wealthier areas of the Midlands. Wales, the North and most of the Midlands are better in terms of affordability than the island.’

The property price index is based on houses and flats sold and registered during the previous year, calculated each quarter and weighted by the relative volume of transactions.

High and low value transactions - above £730,000 and below £70,000 - are excluded.

During 2016, the number of house transactions increased by around 90 to 996 while the number of flat sales fell by 17 to 185.

Mortgage lending continued to fall during 2016. Just over £100m of net lending was repaid, leaving net debt of £1,712m. Mortgage debt peaked at £2.45bn in December 2009 since when it has reduced by around 30 per cent.

Economic Affairs also looked at average prices of properties for sale and rent via agents listed on property website Zoopla. Noting the data should be read with caution as single large properties or multiple listings can skew the results, it found the average listing on the market fell from 65 weeks in January last year to 43 weeks in December.