Property prices slip back again in May

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The recovery in Britain's housing market showed further signs of stagnation as figures from the Halifax revealed that prices fell for a second month in a row in May.

Following a 0.1 per cent fall in April, property prices fell by another 0.4 per cent in last month, the mortgage lender said yesterday.

The figures surprised many City analysts who had anticipated news of a modest increase during May. However, average sale prices in the three months to May were still 7 per cent higher than they were in the same period in 2009, and 8.3 per cent higher than in April last year.

Howard Archer, an economist at IHS Global Insight, said the figures added to worries about the housing market outlook. "Prices could come under near-term downward pressure if plans to raise the rate of capital gains tax on second homes and buy-to-let properties leads to a surge of properties coming on to the market," he warned.