27
Sep
Double dip - Say City Banks
News Story:
City banks predict double dip in UK housing market
Monday 27th September 2010
Global banks have expressed their concerns over the British
housing market. US investment bank Morgan Stanley has said that
Britain’s housing market is set for a double dip, while
Deutsche Bank said that house prices UK remain ‘precariously
high’.
Morgan Stanley is forecasting that UK house prices will fall by
up to 18% by the end of next year.
Its UK economist Melanie Baker said: “Affordability looks
stretched and house prices look over-valued. We don’t think
that a weak recovery in supply is enough to prevent a double
dip.”
George Buckley, an economist at Deutsche Bank, warned house
prices could fall more sharply next year when interest rates rise.
He argued that UK house prices had fallen much less than in the US
– see our story on DIsney prices – and that they
remained precariously high.
Meanwhile, Hometrack reported this morning that house prices
have fallen across every region in England and Wales.
Hometrack said it was the first time this had happened since
April 2009.
The fall, of 0.4%, is for the third successive month. Reporting
for September, Hometrack said that in the last three months the
volume of buyers registering with agents has dropped by 6.5%.
The survey of 5,100 agents also shows that properties are taking
longer to sell, at 9.3 weeks.
Hometrack director of research Richard Donnell said that the
“repricing” process would stretch well into next
year.
But he said: “Talk of a double dip, with the implication
that the market will see double-digit house price falls, is
overdone despite the weak outlook for demand.”
Hometrack puts the average house price at £157,600
Source: Estate Agent Today.