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House prices may need to fall 30%

A Monetary Policy Committee member has warned house prices may need to fall 30% to restore a more sustainable house price-to-earnings ratio.

Prof David Blanchflower issued the warning last night during a speech at the Royal Society in Edinburgh.

Blanchflower says in his speech that property in Britain is overpriced by 30%.

He warns that unless interest rates are cut, a 30% decline in house prices would be needed to maintain a more realistic house price-to-earnings ratio.

He adds: “In my view a correction of approximately one third in house prices does not seem implausible in the UK over a period of two or three years. I am not suggesting that such a drop will necessarily occur, but it may.

“My biggest concern right now is that the credit crisis will trigger a rapid downward spiral in activity. I believe that we face a real risk that the UK may fall into recession, and aggressive action is required to prevent this from occuring.”


Salt cuts packager panel to eight

Specialist lender Salt has slashed its packager panel from 46 to just eight packagers, covering six companies.A spokesman for the Derbyshire owned Salt brand says that it made the decision after pulling from the sub-prime market and found that it no longer had the need to deal with packagers as much as it used to.Mortgage […]

Top seaside property hotspots revealed

Like to let beside the seaside? The latest research from LendInvest looks specifically at coastal towns to find which areas offer the top average rental yields to landlords. Where are the top seaside postcodes for landlords? The interactive map below looks at the highest rental yields along the UK coast. According to the data, Hull, […]


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