Fitch forecasts further 20% fall in UK property prices
Fitch - the ratings agency – is today forecasting a further 20% fall in UK property prices.
Their view is that property needs to drop 30% from its 2007 peak. To date, the decline amounts to only 13% and therefore a further fall from October 2009’s position will follow.
The likes of these reports have been badly wrong before, but this time, the analysis is correct. The difference is unemployment. Property prices have never fallen in a market where employment is growing. Now that the axe will be taken to public sector jobs and the private sector is hardly growing, more unemployment and a greater tolerance for repossessions will drive down property prices… slowly.