UK Houses 65% Overvalued: Property Crash
MANY of us have an inflated view of ourselves. And we all have an inflated view of our houses.
According to the snappily named Organisation for Economic Co-operation and Development, UK property prices are up to 65% too high and are among the most inflated in any major world economy.
The OECD also warns that a subsequent slowdown is long overdue and that a property crash could not be ruled out
Capital Economics’ Ed Stansfield points to lower borrowing costs and a shortage of new property as reasons for the UK’s decade-long property price explosion, although he puts the overvaluation of the housing market at a minimum of 15 to 20 per cent.
With experts predicting that the Bank of England could raise interest rates to 6 per cent by the end of the year, homeowners may well be forced to dig even deeper to pay the mortgage.
Will this property madness ever end? Expect the homeless to start paying rental on their shop doorways.
MPs are backing an attempt to erase the word ’McJob’ from the dictionary. It’s not like there are more important issues to address, is it?
Posted: 25th, May 2007 | In: Money Comment | TrackBack | Permalink
