Tuesday, Dec 23, 2008
"new home prices look almost certain to fall much further"
Mortgage Solutions: New-build prices to fall 40-45%: Capital Economics
Gloomy analyst Capital Economics has predicted the underlying value of new-build properties will experience a peak to trough fall of 40-45%, up to 10% more than the wider market. The firm highlighted that as house-builders’ operational survival directly depends on their ability to sell their properties, they may be more willing to drop property prices than existing homeowners will be. Capital Economics said it believed the credit squeeze has affected demand for new-build homes more than it has affected demand for second-hand homes as lending criteria have been particularly tightened for first-time buyers and buy-to-let investors, the two buyer groups who have the strongest preference for new properties.
Posted by jack c @ 01:52 PM (443 views) Add Comment
2 Comments
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1. crunchy said...
I remember e mailing Mr R. Bootle around a year ago saying 60/70% drops acording to myself and my mate Mr Fibonacci.
Looks like he is starting to agree with us. lol.
What it is going to take down with it is another matter!
2. denzil said...
I think new-builds, especially the BTL tissue-paper walled dross will fall between 50-55% but typical 2nd and 3rd time buyer established properties will bottom out at 35-40%.
Then again, Gordon Brown is so anxious to win an election that I can see him pumping so much tax payers money into the economy that he will create a fabricated delay to the crash.