House prices in England will fall this year and next before recovering, the National Housing Federation forecasts.
It expects prices to fall 12.2% in 2009 and 4.6% next year, before stabilising in 2011 with a 1.1% rise and continuing to climb in the following years.
It predicts that, by 2014, house prices will be 20% higher than current values.
But the group, which represents housing associations, said English homeowners who bought at the market peak could be in negative equity for five years.
Although five-year forecasts can be unreliable, the group said that not enough homes were being built.
Price predictions
The group has suggested that house prices would fall sharply this year. This was in stark contrast to the view of the Nationwide Building Society which this week said there was a “reasonable chance” that prices in the UK could end the year higher than they started 2009.
The reversal in 2011 would accelerate in 2012 with a 7.5% increase in prices, the NHF said, followed by rises of 8.4% in 2013 and 6.8% in 2014.
That would mean that English homeowners who bought at the height of the property boom would be in negative equity until 2014.
“Our research shows that, while house prices are falling in the short term, they will inevitably increase in the long term because of a fundamental under-supply of housing,” said NHF chief executive David Orr.
Only 60% of new homes required to be built each year were being constructed, the NHF said.
The group said that many young and lower-income people would remain locked out of the housing market until restrictions on lending by mortgage suppliers eased.
Visit the BBC site to read the full article.
Related posts:
- How To Avoid Property Repossession
- Top Tips For Buying Repossessed Homes At Auction
- Repossessed Homes Legal Advice Fund Doubled
- Sharp Increase in Repossessed Homes at Auction
- REDC Repossessed Homes Auction
Tags: home repo, home repossession, property auction, property repossession, repossed home, repossessed homes, Repossessed Homes UK, repossessed houses, repossessed property, repossession houses, repossession properties