delusionofgrandeur

Halifax home price data released today shows that home prices in the UK have fallen 7.76% since their peak in August last year. The average home ‘lost’ £15,500 in potential sale value over this period.

Levels of borrowing in what some describe as the biggest asset price bubble in UK history reached over 5x the average salary with people on lower incomes borrowing even more. Now the credit crunch causing banks to reign in their lending in no small way, preventing excessive borrowing. The knock-on effect is a collapse in the house price bubble as sellers are forced to reduce their asking price to meet the limitations of mortgage offerings.

Halifax data[MS Word Doc]

This entry was posted on Thursday, June 5th, 2008 at 9:10 am and is filed under Credit Crunch, Economy, Fantasy House Prices, News.You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.