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House Prices Won't Crash Because Of Financial Crisis

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I was just on the web looking for analysis as to whether the current market problems will affect house prices when I came across this gem.

Property market 'safe' from financial crisis

Nicky Burridge, Press Association

16 August 2007

Reader comments (4) | Vote

The housing sector should stand firm despite the recent stock market turbulence, analysts said today.

Economists said the recent volatility was unlikely to affect property prices, as the UK economy still remained strong and unemployment was low.

But the crisis in the US sub-prime mortgage market is likely to have an impact on mortgage rates in this country, although in some cases it could lead to lower rates, rather than higher ones.

Martin Ellis, Halifax chief economist, said: 'I don't think the stock market falls will have much of an impact.

'The economic fundamentals are still very strong, the economy is doing well and unemployment is still very low. If you look back to the stock market crash of 1987, the housing market remained strong and continued to be so into 1988.'

He added that following the stock market fall in 2001, people were reluctant to invest in shares, with many instead turning to buy-to-let. He said if this happened again it may even give the market a boost.

Correct me if i am wrong but did the housing market not crash in 1989! the delay was only one year after Black Wednesday.

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Martin Ellis, Halifax chief economist, said: 'I don't think the stock market falls will have much of an impact.

He does know how mortgages work, right?

Lying or stupid.

And in answer to your question, yes.

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