|
|
Lehman disaster will damage UK house prices
Wednesday 17th September 2008
Last night economists predicted that Lehman Brothers’ recent bankruptcy will have a serious effect on house prices as banks restrict lending.
Both economic analysts Global Insight and Capital Economics confirmed that house prices will continue dropping, especially amongst the current financial turmoil we’re experiencing with the failure of major
The Government’s index has reported that house prices have fallen 0.3% since July 2007. However these figures clash with those of Nationwide Building Society index, which calculated a 10.5% fall in house prices over the year. Howard Archer from Global Insight put these discrepancies down to the Government’s index lagging that of Nationwide as it was based on completed mortgages.
Archer, along with other economic experts, has warned that banks will reduce risk and lending volume due to the financial market troubles raising the cost of interbank borrowing.
Along with increasing levels of unemployment, these aspects will force house prices to drop quickly as people will have no choice but to sell their houses at deep discounts.
Property economist Seema Shah from Capital Economics commented, ‘Recent events in the financial markets and the likely fall-out on the wider economy, which is already tipping into recession, are set to weigh heavily on buyer confidence. We expect house prices to continue heading south for many months yet.’
Share this article:
Nowpublic
Digg it
Del.icio.us
Reddit
Newsvine
Related News Stories
‘Significant’ number of brokers owed commission by failed debt firmWednesday 28th July 2010
Bank worker embezzled £150,000 to pay off credit card debts
Wednesday 28th July 2010
Consumer credit regulation may be taken from the OFT
Wednesday 28th July 2010
Northern Rock director banned for continued misreporting of mortgage arrears
Wednesday 28th July 2010
Divorce on the rise again as debt-ridden couples save up for split
Wednesday 28th July 2010
Most Read News Stories
Barclays lifts lid on banking write-offsWednesday 20th February 2008
Send To Friend Print
RSS Feed
News Archive
Feedback:
If you have any queries about this news story or our news section, please contact us
