End of tax breaks leads to fall in interest in US property

The end of tax breaks in the US property market has led to a fall in the number of individuals purchasing real estate in the country, it has been claimed.

Sales of previously-owned homes fell by a record 30 per cent during May following the removal of the federal tax credit.

According to the National Association of Realtors (NAR) Pending Home Sales Index, contracts signed during the month fell to 77.6, down from 110.9 in April.

NAR chief economist Lawrence Yun predicted that while existing home sales are expected to remain elevated in June, a decline will be seen during July and August.

"Consumers are rational and they rushed to meet the tax credit eligibility deadline in April," he added.

"The sharp decline in contract signings in May is a natural result with similar low levels of sales activity anticipated in June."

Meanwhile, individuals interested in Florida property may want to take advantage of the surplus of distressed homes now on the market.

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