subject: Uk Housing Rally Runs Out Of Steam As Sellers Flood The Market [print this page] The UK housing market cooled abruptly last month, a survey showed today, but consumers splashed out for Easter despite uncertainty ahead of next month's election.
The health of the economy has become a political battleground ahead of a May 6 election that is shaping up to be the most unpredictable contest since 1992.
Britain pulled out of recession at the end of 2009, but a looming public spending squeeze has raised doubts over how durable the recovery will be.
The Royal Institution of Chartered Surveyors (RICS) said its monthly house price balance dropped to +9 in March, its lowest since July 2009, from +18 in February.
New instructions outpaced new buyer enquiries for the third consecutive month, fuelling a 6% rise in the average stock of property on surveyors' books -- the largest monthly increase in more than two years. The increase in supply to what has been a supply starved market, may be responsible for the price correction.
"With the general election approaching and uncertainty growing over the political direction of the country, many vendors who were previously inclined to sit on the sidelines now appear eager to put their properties on the market," said RICS spokesman Ian Perry.
House prices have jumped around 10% from a five-year low set in the first half of 2009 but the pace of increase has slowed markedly since the start of the year.
Separate figures from the British Retail Consortium (BRC) showed retail sales jumped sharply last month on a year ago, but the figures may have been flattered by the timing of Easter.
The BRC said the value of sales last month was 4.4% higher than a year ago when measured on a like-for-like basis, the biggest rise since last April and double the increase in February.
Total sales, which include new floorspace, rose by an annual 6.6%, the best showing since April 2006.
The industry group's survey covered the five weeks from Feb 28 to April 3 which took in two days of the long Easter weekend. The March 2009 survey did not include any days of the Easter holiday.
"These are strong figures but they would have been only half a good without the distorting effect of Easter," said BRC director-general Stephen Robertson.
Britain's economy grew by 0.4% in the fourth quarter of 2009 after an 18-month recession that wiped out more than 6% of output.
First quarter gross domestic product (GDP) figures, due on April 23, are expected to show the recovery continued into this year but tax changes and unusually snowy weather in January have made economic data hard to interpret.
