The property researcher said the average cost of a home in the UK slipped 0.1% since May and was down 3.9% from a year earlier. However prices in London increased 0.2% on the month.
UK house prices declined in the past year as government budget cuts and accelerating inflation squeezed finances and banks tightened lending requirements forcing potential homebuyers to raise bigger deposits.
Hometrack said the number of housing transactions surged this month as sellers showed a “greater realism” on pricing.
Hometrack revealed the supply of properties on the market rose 3.5% in May while demand, based on the number of buyers registering with estate agents, rose 1.9%. The number of sales agreed on jumped 11%.
Richard Donnel, director of research at Hometrack, said: “While the balance between supply and demand is not significantly out of kilter, subdued demand and weak consumer confidence are set to keep headline prices under modest downward pressure over the months ahead.
“However the market continues to be highly polarized with a wide differential between London and the rest of the country.”
