It affected everything from electronics to clothing, from books to toys, and yesterday it was the turn of the art and antiques market to count the cost of the economic downturn on pre-Christmas trading figures.

Suffering under the further blow of heavy City job losses in London, the Royal Institution of Chartered Surveyors (RICS) reported that more than 40 per cent of auctioneers and valuers said that sale prices had fallen in the final three months of last year, with only 9 per cent reporting a rise. The balance of minus 32 is down from minus 2 in the third quarter and 20 at the beginning of the year.

The RICS report came only a day after Christie’s, Britain’s oldest auction house, said that it was cutting a quarter of its 800 UK staff in anticipation of a 20 to 30 per cent fall in sales.

A spokesman for RICS said: “The difficult financial situation is affecting all parts of the economy and the art and antiques industry is no exception.” The spokesman added, however that the downturn in the sector had not been as dramatic as in other areas of the economy.

The contemporary art market, which has boomed in recent years, suffered a sharp slowdown between October and December, with 41 per cent more valuers reporting a fall rather than a rise in lot prices.

Pieces valued between £1,000 and £5,000 were hit hardest, with 58 per cent more valuers reporting a drop in prices. Two thirds of valuers said that prices for contemporary pieces worth more than £50,000 were rising rather than falling between July and September, but by the final three months of the year, 13 per cent more valuers said that prices were declining. Forty per cent more valuers said that furniture prices fell and 47 per cent more said that oil and watercolour prices fell between October and December.

Some experts said, however, that demand for art and antiques could rise as investors seek alternative investments in the coming months.