The Council of Mortgage Lenders, whose house price forecasts have been among the UK’s most optimistic, yesterday threw in the towel, saying conditions were too difficult to make predictions, and that no improvement was likely until 2010.
The CML’s last forecast, made in May, was for prices to be 7% lower in the fourth quarter than last year. Indices from Halifax and Nationwide, both CML members, suggest that prices are already down by more than 10% on the year.
'While we accept that our forecasts currently understate the likely magnitude of the house price correction in the UK this year, we believe it is futile to update them in current market conditions,' the CML said.
Halifax and Nationwide are forecasting peak to trough declines of 20 to 25% and some private sector economists are predicting even steeper falls.