Thursday, October 30, 2008
I was wrong
Last October, I predicted that UK house prices would fall 9 percent in the coming year. According to the Nationwide, house prices fell by 14.6 percent. The housing crash has surpassed even my dismal predictions.
Average house prices are down ₤30,000 relative to the peak back in October 2007. However, the Nationwide wanted to put this number "into perspective". They boasted that prices were still ₤30,000 higher than five years ago. Well, if the present rate of decline is sustained over the next 12 months, prices should easily wipe out that five year gain.
Just for the record, house prices have fallen back to their February 2006 level. All those bubble profits are evaporating; so many broken dreams, so many crushed illusions.