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London's housing market is mired in its weakest February for five years, as fears of paltry bonuses and job losses in the City - the British capital's financial district - sap buyer confidence, property website Rightmove reports.
While activity has picked up in much of the UK after two cuts in interest rates, the London market has been rocked by the crisis in financial markets. House prices are rising at less than half the 2 per cent pace of last February.
"The rest of the country is somewhat removed from all this - the City of London feels more exposed," said Miles Shipside, Rightmove's commercial director.
Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, agreed. "What we have seen in London is a big turnaround from very positive to quite negative," he said.
Meanwhile, New York is benefiting from an influx of wealthy foreigners seeking to take advantage of a cheap dollar and plunging house prices. The number of foreign nationals buying houses in the US increased markedly last year, according to the National Association of Realtors (NAR), an estate agents' body based in Washington DC.
"The falling value of the dollar against the euro and sterling is an obvious cause of this," said David Wyss, chief economist at Standard & Poor's in New York.
Plans to levy a £30,000 ($73,483) tax on wealthy "non-domicile" UK residents is expected to further spur the number of overseas buyers in New York, said Jo-Anne Kennedy of Manhattan estate agent Coldwell Banker Hunt Kennedy.
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