How badly will UKs housing market crash?

Last Updated: May 13, 2008

 

After 12 years of continuous annual increases, house prices in UK have dropped.

After six monthly declines in a row, house prices slipped by 1.1% in April 2008 from a year earlier. The average property price was £178,555 in April 2008, 4% lower than the peak level of £186,044 in October 2007, according to Nationwide.

The recent price falls signal seem to signal the end of UK’s house price boom (average house prices rose by around 190% from 1997 to 2007).

The question now is “By how much will house prices in the UK fall?”

Economists from research firms Capital Economics and Global Insight expect house prices to fall by as much as 20% from their peak.

Other experts believe that housing market is in for a soft landing or a slight correction, rather than a full crash.

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How badly will UK’s housing market crash?

It depends on how soon the authorities act
Only a slight correction
At least 2 years of house price falls

 

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