UK Daily Mail
Friday, Oct 24, 2008
House prices could fall by a further 25 per cent by late 2009, influential economic analysts warn today.
Experts at the Capital Economics consultancy said the coming recession will speed up the housing market “correction”.
In an influential report published today, the analysts poured scorn on the Government’s recent bank bailout, claiming it could fail to shore up the property market.
‘Our view that house prices will ultimately fall by 35 per cent – or a further 25 per cent from today’s prices – still holds,’ the report said.
‘However, with the economy heading for a recession lasting for at least two years, we now think that those falls could be seen by late 2009 or early 2010 – a year earlier than our previous forecast.’
It concludes that the UK economy will shrink by 1 per cent in 2009 and by 0.5 per cent in 2010, and that unemployment will rise by almost 1.5million.
But Capital Economics does not think that the deeper recession will necessarily result in a deeper housing market downturn.
This article was posted: Friday, October 24, 2008 at 3:51 am