HOME prices have not fallen by as much as previously thought, according to the latest Jones Lang Wootton Property Index. The quarterly monitor for October to January shows that overall residential values slipped 3.58 per cent, less than many estimates. It also shows that average values of larger flats and houses slipped 2.79 per cent over the quarter, against expectations. Mass residential capital values have fallen since July, but analysts and developers had been confident that luxury residential prices were still rising. JLW's industry monitor shows that capital values of large homes rose by 32.22 per cent over the whole of 1992, and overall residential prices rose by an average of 28.26 per cent over the year. The residential market has cooled considerably since the Government's two initiatives to keep home prices under control after a couple of years of runaway prices. The introduction of stamp duty on transactions and the mortgage lending ceiling of 70 per cent of the property price persuaded many speculators to flee the market. Commissioner of Banking David Carse has been monitoring property prices to see whether the mortgage lending guideline to banks should be reviewed. Property industry leaders have argued that the lending restriction has served its purpose and is now penalising genuine home buyers, many of whom cannot afford a 30 per cent down-payment. The JLW survey, showing that prices were holding up better than expected, contradicts property transaction figures for December, which supported the argument that activity had fallen considerably. Last week, Registrar General Noel Gleeson announced that the total number of sale and purchase agreements of flats registered in the Land Office in December had fallen by 34.7 per cent to 7,970, compared with December 1991. The index shows that residential rental rises had also slowed considerably, from 6.31 per cent between July and September to 0.53 per cent over the final quarter. Rises in office values varied over the quarter, depending on the district. The index shows prices increased by 4.19 per cent in Tsim Sha Tsui over the quarter, but by just 1.49 per cent in Wan Chai/Causeway Bay, where there has been a lot of new supply. Values in Central rose by 1.15 per cent. Average office values rose by 36.17 per cent over 1992 as a whole. JLW notes an absence of mainland Chinese buyers during the Sino-British political dispute that dogged the closing quarter. Mainlanders were by far the most prolific buyers of Hongkong office space earlier in the year, helping prices climb. Many speculators who fled the residential sector last year took refuge in retail property, helping prices to rise, says JLW. The large volume of new supply prevented values from rocketing. Retail values rose by 4.41 per cent on average over the quarter and by 28.53 per cent over the whole year. A large amount of new supply is also due to come on-stream in 1993, particularly in Causeway Bay with the opening of Wharf's giant Times Square commercial development. The survey shows that industrial values rose by only 1.08 per cent during the final quarter, but were the year's star performers, rising a hefty 27.2 per cent after some depressed years. Rentals were up all round. Average office rentals were up 3.27 per cent over the quarter and 12.23 per cent for the year, JLW says. Industrial rentals rose more sedately, by 0.49 per cent during the quarter and 8.46 per cent for the year.