Tuesday, September 9, 2008
Received wisdom says house prices will keep rising because of all the immigrants. What if the immigrants leave?
Most of today's papers talk about Fannie & Freddie, but here's an article less obviously related to house prices. "WE NOW LIVE IN AN ERA of high mobility and rapid demographic change, and - like house prices - what has gone up can come down. For example, the migration assumptions underlying government predictions [...] are very probably too high. Already about half of those economic migrants who came to Britain from Eastern Europe after 2004 have left. The number of applications for work entries fell by more than 20 per cent between comparable periods in 2007 and 2008. You don't have to be Nostradamus to realise that the coming recession will see that drop further, possibly dramatically. The predictions, then, are pretty worthless."