By Christina Fincher

EDINBURGH (Reuters) - Britain faces a real risk of recession and house prices could crash by more than 30 percent unless the Bank of England takes "aggressive" action, policy-maker David Blanchflower said on Tuesday.

In direct contrast to Bank of England Governor Mervyn King who said earlier on Tuesday that people were being too gloomy on the economy, arch-dove Blanchflower said the latest numbers on retail sales and mortgage approvals looked "horrible."

"Developments in the UK are starting to look eerily similar to those in the United States six months ago," he told an Edinburgh audience. "There has been no decoupling of the two economies; contagion is in the air."

Blanchflower had wanted to cut borrowing costs by 50 basis points earlier this month but was outvoted by the majority backing a quarter-point reduction as policy-makers are becoming increasingly split over how to tackle slowing growth and rising inflation.

Arch-hawks Andrew Sentance and Timothy Besley had wanted no rate cut at all, arguing that prices were rising too fast and some economic slowdown was needed.

King earlier on Tuesday gave no indication he was in a hurry to cut interest rates.

But Blanchflower argued that failing to act swiftly will only mean borrowing costs have to fall further in the long run.

"We face a real risk that the UK may fall into recession, and aggressive action is required to prevent this from occurring. There is a real risk that inflation may undershoot the target in the medium term," he said.