Home sales slide as gloom deepens
The number of homes changing hands fell nearly 40 percent on the year in May, spelling more gloom for the country's estate agents and furniture retailers as a housing downturn intensifies.
One in five fears for mortgage paymentRevenue and Customs said on Monday property transactions numbered 100,000 last month, 13 percent lower than in April. Experts say activity will fall further in the months ahead as a global credit crunch makes new mortgages harder to come by.
News of the big drop in transactions followed a report by property Web site Rightmove which showed sellers outnumbering buyers in Britain's once-booming housing market by 15 to one.
"These numbers clearly highlight the very real pressure on the residential property market," said Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors.
After years of double-digit growth, house prices are now falling at monthly rates not seen since the slump of the 1990s, raising concern the market could be headed for another crash that takes the economy down with it.
Property and retail companies are already suffering, as is Prime Minister Gordon Brown's Labour government. Consumer confidence and house prices seem inextricably linked in Britain where two-thirds of households own their homes.
More than 15,000 estate agents are expected to lose their jobs in the next two years, according to one research group.
British sofa retailer SCS Upholstery said on Monday it was in talks over a rescue plan for its business that would leave shareholders with almost nothing. Its shares have tumbled 90 percent in the last two months.
LAND OF TROUBLE
Its rival, Land of Leather, also said last week it needed to more funding to help it cope with plunging demand. Department stores group John Lewis reported on Friday a 9.7 annual drop electricals and home technology sales in the week to June 14.
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