'10% chance of housing market crash'

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said he thought there was a 10% chance that the value of property could fall steeply.

He added that there was also a 20% chance that house prices in London would fall by 10% during the coming 12 months.

But he said overall he thought it was most likely that house price growth would remain flat during the coming 12 to 15 months, down from his earlier forecast that prices would rise by 3%.

Nationwide Building Society warned at the weekend that house price growth could halve as a result of the current credit crisis.

Fionnuala Earley, group economist at Nationwide, said the global financial crisis would exacerbate the impact of rising mortgage rates and could make the current slowdown in the housing market worse. She now expects house price inflation to slow to just 3% next year.

But Ray Boulger, senior technical manager at John Charcol, said there were unlikely to be house price falls, adding that the problems in the credit markets could be good for house price inflation in the long run.

He said: "Saying there is a one in 10 chance (of a house price crash) is more or less saying they don't think it is going to happen.

"The last quarterly survey from Halifax showed three regions with small falls and I think for the second half of this year we will see prices pretty well flatlining.

"Most people think the credit crunch will have a negative impact on house prices and I think in the short term that will be right, but looking ahead a few months, I think it will have a positive impact."