House prices in the United Kingdom fell again in May as deepening Eurozone crisis and the end of a tax holiday for first-time home buyers curbed demand.
A survey by Royal Institution of Chartered Surveyors revealed Tuesday that the house price balance was at -16 in May, slightly up from -19 in April. This compares to a score of -17 expected by economists.
Though the balance improved during the month, the reading below zero signals that the number of survey respondents who expected a drop in prices was higher than those who predicted an increase.
London was the only region to record an increase in house prices during the month.
"Ongoing economic instability in the U.K. and overseas has continued to undermine consumer confidence," RICS spokesperson Peter Bolton King said.
However, a majority of surveyors said they expect sales to rise in the next three months, though the balance fell to 9 from 14 in April.
UK Chancellor George Osborne wrote in the latest edition of the Sunday Telegraph that the recovery of the British economy is being "killed off" by the Eurozone debt crisis.
The economy slipped back into recession in the first quarter of 2012 with the gross domestic product shrinking 0.3 percent sequentially following a similar contraction in activity in the fourth quarter of 2012.
A number of other surveys showed a sharp divergence with the results of the RICS survey. A report from the Nationwide Building Society showed last month that the U.K. house prices rose 0.3 percent from a month earlier in May, while demand remained subdued. Lloyds Banking Group's Halifax division said prices increased 0.5 percent in May.
by RTT Staff Writer
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