Wednesday, February 13, 2008

Not just the RICS: Almost Everyone agrees

House prices set to fall by 7% in next two years as credit squeeze bites

"Goldman Sachs said it expected house prices to fall by 5 per cent this year and a further 2 per cent in 2009. The bank had originally predicted a decline of 3 per cent in 2008 and no further change the year after, but became more pessimistic after economic warning signs." They should know, they've looked at the Northern Rock for quite some time. Surely noone (apart from the Express) is going to disagree?

Posted by growler @ 07:28 AM (664 views)
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5 thoughts on “Not just the RICS: Almost Everyone agrees

  • Goldman have some credibility here as they were not hit as bad in the subprime debacle.

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  • 7% seems extremely small if you look at the what has happened historically. No doubt it’ll be revised again and again.

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  • I want to see more articles like this.

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  • YIEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEPEEEEEEEEEEEEEEEEEEEEEEEEEE

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  • Only 7%? Last time it was a 15% nominal fall between July 1989 and February 1993. However over that 3.5 year period RPIX rose by 22% and average earnings by 27%, giving a fall in real terms of 30% or 33%. In London it was worse – 21%, 35% and 39% respectively (I downloaded the series from Datastream.) And looking at the graphs in the ABN AMRO report, it looks to me as if we are further out of line with earnings and rents now than we were then.

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