The Last House Price Crash
This graph shows average house prices during the last House Price Crash or ‘Great Financial Crisis’ [GFC].
It depicts house prices still rising, late in the cycle, peaking in September 2007 at £190,032 [U.K Av.] before crashing and falling to lows of £154,452 in March 2009.
In nominal terms [not adjusted for inflation] £35,580 had been wiped off the value of the average home.
To see the latest UK house price data click here
Data for Northern Ireland is reported quarterly.
During the last House Price Crash average prices in the U.K fell by -15.60% between February 2008 and February 2009.
To see the latest UK house price data click here
As shown in the graph it took until August of 2014, almost 7 years later, for house prices to recover to their, ‘pre crash’ level [not adjusted for inflation].
To see the latest UK house price data click here
The 90's House Price Crash
Here’s a graph to show what happened in the last house price crash. Many will remember the boom years of the 80’s with yuppies and their huge mobile phones, then the desolation of the 90’s with negative equity, record high interest rates and high unemployment.
If you look at the graph you will see that from peak to trough we are only talking about a nominal 13% fall. However, if you take into account inflation then the fall is much larger. Some economists are predicting a 40% correction or more this time around, but even if you look at a conservative prediction of 20% then you can work out for yourself what the effect will be on the UK economy.
The difference this time round unfortunately is that we all have so much more debt which will mean that this will affect us all and the house price crash along with the economic fallout will be even worse than the crash of the early 90’s.
To track what happened to House Prices in the Last 4 Recessions – Click Here
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