Tuesday, December 23, 2008
Not quite as bearish as Capital Economics
George Buckley, chief UK economist of Deutsche Bank, said the slump in prices that began last autumn had only run a third of its course. He warned the property market collapse still has two years to run and will not bottom out until prices are 35% below their peak. By the end of 2010 prices will be back to levels last seen in spring 2003, putting millions of owners into negative equity. His prediction is in contrast to some property market professionals who say that the market will bottom out next summer. Stuart Law of Assetz said prices would only fall 'modestly' in the first half of 2009, hitting bottom after the summer. But Marsh & Parsons estate agents said average completion prices in Kensington and Chelsea were already down 24% in sterling, or 42% in euro terms.