'10% chance of housing market crash'

Updated 16.05 Tue Sep 18 2007

Keywords: crash, price, Simon Rubinsohn, Housing

The UK Housing market has a one in ten chance of heading for a 1990s-style price crash according to leading experts.

Simon Rubinsohn, chief economist at the royal institution Chartered Surveyors, believes there is a 10 per cent possibility that the value of property could fall dramatically.

''The global financial crisis could make the current slowdown in the housing market worse''- Fionnuala Earley

He went on to say there was also a 20 per cent chance that the house prices in London would decrease by 10 per cent during the coming 12 months.

He concluded by saying that it was most likely that house price growth would remain flat during the coming 12 to 15 months, down from his earlier prediction that prices would rise by 3 per cent.

Nationwide Building society has also expressed concerns at the current house price growth.

Fionnuala Earley, group economist at Nationwide, predicts house price inflation to decrease to just 3 per cent next year.

She said the global financial crisis could make the current slowdown in the housing market worse.