- June 3, 2008 at 11:37 am #54024
The american sub-prime mess is out in the open, and the european sub-prime lending shambles is about to hit home. As well as the well publicised issues that have seen Bradford & Bingley shares tumble, now we see pressure on the Irish banks. Irelands property inflation has been as crazy as spain and the UK’s, so there will be more bad news to come
check out http://www.housepricecrash.co.uk to say the graph of UK house prices and you can see just how far ABOVE the ‘trend’ line that property prices have risen. In other words, the bubble will burst. In the uk we have had falling house prices for 6 months so many are still in denial, but the fall out from this mess will surpass most expectations
- June 3, 2008 at 6:35 pm #83507
I think you are possibly being a little too over enthusiastic about your predictions Kingy. You may well prove me wrong, but my gut feeling is that prices will fall 20 – 25% and then stabilise due to high levels of demand. When credit becomes more freely available, I think prices may quickly bounce back. The UK is not in such a bad position as some other countries. Employment remains high and the demand for property is also high. Don’t forget, this is a credit problem. Oil prices will spike and then fall to a more sustainable level and with the falling pound demand for exports will rise. Also, I feel that the authorities will allow inflation to erode the National Debt and we will see a fall in interest rates.
Then the UK buyers will be back into Spain. It might well be the case that the worse is already over!
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