House prices to 'fall not stall' in 2008

News Category: Industry News

This article was brought to you by Rentman the premium rent management software

Claims that house prices will stall next year are inaccurate and instead they will fall by up to 12 per cent, a mortgage broker has claimed.

The housing market is due a correction of up to 25 per cent on property prices with recent suggestions that house price growth will stall at zero per cent severely underestimating the extent of the slowdown, according to Paul Holmes, chief executive of Firstrung.

However, he claimed that it was impossible for anyone involved in residential lettings to judge just how quickly any correction on property values would actually take place.

Mr Holmes said: "To [predict a] sudden, gradual grind to zero per cent without severe collateral damage, I think is silly, quite frankly."

"I genuinely predict a 25 per cent correction. But how long that is played out over, and how long wages take to catch up and normalise that correction, is anyone's guess," he added.

Last week the Nationwide House Price Forecast predicted that house price inflation would drop in 2008 from this year's level of 9.7 per cent to zero per cent by this time next year.

Find out more about letting agency software