Howard Archer of IHS Global Insight certainly suggests so:
The 0.7% drop in house prices in October reported by the Nationwide is consistent with our view that house prices will trend down gradually over the final months of 2010 and during 2011 to lose about 10% of their value. Latest housing market data and surveys have been consistently weak, and the housing market really does not seem to have got much going for it at the moment.
High (and likely to rise) unemployment, muted wage growth, an increasing fiscal squeeze, low and deteriorating consumer confidence, difficulties in getting a mortgage (particularly for first time buyers), a housing supply/demand balance currently firmly in favour of buyers and a house price/earnings ratio above long-term norms are a poor combination of factors for house prices. Low interest rates and the current stamp duty holiday for first-time buyers on all properties costing up to £250,000 only partially offset these adverse factors.
Critical to the development of house prices over the coming months will be the amount of houses coming on to the market, mortgage availability and how well the economy and jobs hold up as the fiscal squeeze increasingly kicks in.Excerpt is from above article link.
Read the thoughts below on the blog.
Food for thought.
Ray
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