Forexpros – U.K. house prices fell unexpectedly in March, with weakness reflecting the end of a stamp duty holiday, industry data showed on Thursday.
In a report, U.K. mortgage lender Nationwide said its house price index declined 1.0% in March, defying expectations for a 0.2% increase.
U.K. house prices rose by 0.4% in February, whose figure was revised down from a previously reported 0.6% gain.
Year-on-year, home prices in the U.K. fell at an annualized rate of 0.9% in March, confounding expectations for a 0.9% increase, after rising by 0.9% in the preceding month.
Commenting on the report, Nationwide’s chief economist Robert Gardner said, “A slowdown was to be expected, given the imminent expiry of the stamp duty holiday, which had provided a temporary boost to house prices in early 2012.”
“This dampening effect on housing market activity and prices may fade over the course of the summer, especially if the wider economic outlook begins to improve.”
“However, in our view the challenging economic backdrop is likely to continue to act as a drag, with house prices moving sideways or modestly lower over the next twelve months.”
Following the release of the data, the pound was modestly higher against the U.S. dollar, with GBP/USD rising 0.19% to trade at 1.5918.
Meanwhile, European stock markets were mixed after the open. The EURO STOXX 50 shed 0.15%, France’s CAC 40 eased up 0.1%, Germany’s DAX fell 0.2%, while London’s FTSE 100 was flat.
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