Further falls expected in property prices
www.moneynews.co.uk > General finance > Further falls expected in property prices
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Money News |
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Further falls expected in property prices
Mon 24th Jan 2005
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Kate Barker, in a speech to the Institute of Economic Affairs, said that while it was "foolish" to make predictions about any single asset price, house price falls remain the most likely outcome.
"In view of the evidence on affordability, and the balance of arguments about overvaluation, the likelihood of some decline in house prices, at least relative to earnings, seems now to be much greater than that of a further significant increase," she said.
And any falls in the next three months are likely to be repeated, she added.
"Past experience suggests that house price movements in one direction over a quarter are more often than not followed by a further change in the same direction."
Ms Barker, who was previously chief economic adviser at the CBI, added that the prediction of a modest fall in house prices was "only one of a wide range of possibilities," especially as asset prices can spend large amounts of time well far higher, and lower, than their fundamental values.
She added that house prices were far from the dominant issue for the UK economy, with the fall of the dollar in the last three months at least as significant.
The early signs of the property market in 2005 point to modestly falling, but stabilising, house prices.
Related News : General finance |
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