House prices 'will fall up to 10% next year and take years to recover'

carolt

House prices 'will fall up to 10% next year and take years to recover to pre-recession levels'

Read more: http://www.dailymail.co.uk/news/article-1229508/House-prices-fall-year-wont-climb-pre-recession-levels-2014.html#ixzz0XQDJDQG3

mortgage_adviser_2

However, housing economist, Seema Shah of Capital Economics, said: 'The market is still overvalued, whichever measure you use. Prices need to fall a further 20 per cent to 25 per cent to get back their long-term trend.

'The recent rise we have seen is all about the imbalance between supply and demand, with very few properties coming on the market.'

Her firm is predicting the 10 per cent fall next year. Economists at Fitch are going for a fall of 6-8 per cent, while Savills has a fall of 6.6 per cent.
Others predicting falls include the Royal Institution of Chartered Surveyors, Knight Frank, the National Institute for Economic and Social Research, Deutsche Bank, Cluttons and the RBS group.

worldtraveller

Capital are about the only firm of economists that I take any more than a glancing notice of and who have been, IMHO, nearer the mark with their analysis throughout the financial crisis. The rest of them are pretty pointless. I'd broadly agree with them on the above, with a larger fall expected in 2011.

HammerSmashedFace

Pretty good news if it turns out to come true, we'll see I guess. Property is still 20% down from peak in most areas I was browsing upto a month or so ago, in fact the only evidence I've seen of Haliwide's HPI this year is the headlines in the Daily Express and errr..... Hamish's signature:D, other than prices a few percent down on last year along with the 300 day + average sell time.

Dan:_4

10% down would bring us back to the lows of feb 2009, which means total peak to bottom only around the 20% mark - so far off from some of the predictions banded around this forum 12 months ago.

I stand by my prediction that we have reached the bottom for this cycle.

Mr.Brown_4

I think I'll put my plans for a BTL pwoperty empire on hold for a while. Maybe hang fire on the renovating idea. And perhaps just learn to treat a house like a home rather than a get rich quick scheme.

Dan:_4

Mr.Brown wrote: »

And perhaps just learn to treat a house like a home rather than a get rich quick scheme.

and that's how it should be.

StevieJ

worldtraveller wrote: »

Capital are about the only firm of economists that I take any more than a glancing notice of and who have been, IMHO, nearer the mark with their analysis throughout the financial crisis. The rest of them are pretty pointless. I'd broadly agree with them on the above, with a larger fall expected in 2011.

Their housing forecasts were actually atrocious take a look at their forecasts over the years :eek:

What is the value of typically the same housing bear market / crash forecast that is rolled out every few months? This article takes a look back at Capital Economics that has been grabbing the headlines of late of having forecast the UK housing market crash of 2008. However if you dig a little deeper the actual accuracy of Capital Economics housing market forecasts evaporates into thin air.

http://www.marketoracle.co.uk/Article7183.html

GeneHunt_2

I bought my first house in 1995. Now It's worth 5 times what I paid for it then. So it's increased 500% - so what's 10% drop anyway???

To the op. I believe you have a child going to High School. If you could have brought a house 10 years ago and for some reason you didn't, why would a 10% drop be a consolation for the fact that perhaps you should have bought before? If you'd bought a decade ago you would be nearly half through paying off your mortgage by now. Just a thought.

Degenerate

mortgage_adviser wrote: »

However, housing economist, Seema Shah of Capital Economics, said: 'The market is still overvalued, whichever measure you use. Prices need to fall a further 20 per cent to 25 per cent to get back their long-term trend.

'The recent rise we have seen is all about the imbalance between supply and demand, with very few properties coming on the market.'

Damn that pesky supply and demand thing, getting in the way of "correct" prices.

Where did these people take economics?

carolt

GeneHunt wrote: »

I bought my first house in 1995. Now It's worth 5 times what I paid for it then. So it's increased 500% - so what's 10% drop anyway???

To the op. I believe you have a child going to High School. If you could have brought a house 10 years ago and for some reason you didn't, why would a 10% drop be a consolation for the fact that perhaps you should have bought before? If you'd bought a decade ago you would be nearly half through paying off your mortgage by now. Just a thought.

I don't know. Is it a riddle?

What's the answer?

You tell me.

PS The answer to the first part is 'a 10% drop'. I got that.