Tuesday, Sep 18, 2007
20% chance of a 10% drop in London
Guardian: 10% chance of property crash, says RICS economist
Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics), told Reuters that while talk of a "crash" was legitimate and not irresponsible, homeowners were unlikely to see a repeat of the previous slump. Mr Rubinsohn said he had revised down his forecast for the market over the next 12 to 15 months from 3% growth to a flattening of prices. In London, however, he said there was a 20% chance of a 10% decline in prices over the next 12 months
Posted by confused76 @ 01:23 PM (737 views) Add Comment
9 Comments
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1. confused76 said...
Would be interesting to know what is the chance of a 5% drop, maybe 50%?
and that of a 2% drop? maybe 80%?
Chance of prices going up? 0.01%?
BTLers, think about it!!!!
Sorry, you are in for the long term
2. European Bear said...
Poor old BTLers - BTL (bound-to-lose)
3. inbreda said...
I love revisable forecasts.
"Mr Rubinsohn said he had revised down his forecast "
And next week he will revise it again. And again, and again. Until house prices have dropped 90% and he can say " I told you so. I predicted all of this".
Someone needs to explain the use of a prediction if it is in a constant state of flux.
4. Mark said...
i personally think things are being held up in a BS way and the crash will much worse when the final sh*t comes home from USA
5. rickyb said...
A 20% chance of a 10% decline over the next 12 months ... and with an increasing chance of 10% per month, on an increasing percentage decline of 5% per month ... maybe. All sounds very plausible to me.
6. Wdbeast said...
We have already had forecasts of "a period of stability" and "a slowdown in growth" it is good to see a new one in "a flattening of prices".
So as "a flattening of prices" is a downward revision from 3% growth, he must mean 0% growth in the total UK market over the next 12 - 15 months.
So he is forecating property in at least 50% of the UK going down.
So the actual headline should read "Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics), told Reuters that he is now forecasting a property slump in many parts of the UK over the next 12 - 18 months.
See, he's not that stupid, you just have to read between the lines, even though he is obviously optimistic to the extreme!
7. Ash4781 said...
What does RICS need an economist for ?
8. captain sensible said...
I think what he really means is 'my livelihood depends upon mugs continuing to pay ridiculous prices for property so please believe me when I pick wildly optomistic figures out of the air'.
I read the other day that some mortgage lenders, worried about the risk of overvaluation, were requiring more than one survey on each property. Maybe RICS will spot that this effect of a downturn means that work for its members could double if it starts to talk the market down!
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