U.K. Hometrack House Prices Stopped Falling in May
U.K. house prices stopped falling in May for the first time in 20 months, adding to evidence the property market slump is abating, a survey of real-estate agents by Hometrack Ltd. showed.
Average prices in England and Wales held at 155,600 pounds ($255,000) after they declined 0.3 percent in April, the London- based property researcher said in an e-mailed statement today. On the year, values dropped 9.6 percent. A separate report showed manufacturing contracted at the slowest pace in a year.
The U.K.’s worst recession in at least three decades may be easing as the Bank of England pumps newly-printed money into the economy. Data last week said that consumer confidence held at the highest level in almost a year and house prices unexpectedly jumped by the most since 2007.
“The survey shows that pricing expectations among vendors has finally re-aligned to a level that is more in line with what the current pool of purchasers are prepared to pay,” Richard Donnell, director of research at Hometrack, said in the statement. “The outlook for the economy remains far from certain. It is too early to rule out future price falls.”
The pound rose, surpassing $1.64 for the first time in seven months. The British currency traded at $1.6383 as of 11:26 a.m. in London.
New Buyers
The number of new buyers registering with real-estate agents to browse property rose 6 percent from April, when it increased by the same amount, Hometrack said. The percentage of the asking price achieved rose to 90.3 percent from 89.6 percent the previous month.
Six of the 10 regions tracked by the survey reported no change in house prices. In the East Midlands, the North West, the West Midlands and Yorkshire values declined 0 faxless payday loans.1 percent from the previous month.
Nationwide Building Society said last week that house prices increased 1.2 percent on the month, and U.K. consumer confidence matched an 11-month high in May, GfK NOP said.
House prices fell 0.3 percent in April from the previous month, and 16.2 percent from a year earlier, according to Land Registry data released today. London luxury-home prices fell about 20 percent in May from a year ago and probably won’t return to their 2008 highs for another five years, property broker Knight Frank LLP said in a separate report.
Other indicators are suggesting the recession may be past its worst. An index of manufacturing rose more than economists forecast in May to 45.4, the highest in 12 months, Markit said today. Results below 50 still indicate contraction.
EEF Report
The EEF manufacturing lobby group’s index of factory output based on a survey of 678 companies fell to minus 52 percent from minus 39 percent. The group’s forecasts show manufacturing growth will resume next year.
Across the U.K., jobless claims may rise by an average of 100,000 per month “for the next year or so, and this will be a shock for people,” former Bank of England policy maker David Blanchflower told the Today program on BBC Radio 4 today.
Bank of England policy makers, due to meet on June 4, will refrain from expanding their money-printing plan from the current 125 billion pounds, according to all but two of 39 forecasts in a Bloomberg News survey of economists.