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Tuesday, January 13, 2009

House price falls to continue?

Probably yes.

House prices are still very high for first time buyers. A good way of measuring this is to look at the ratio of average house price to income of first time buyers as measured by Nationwide

This is presently 4.7, in 1995 it was 2.1. This alone suggests that house prices could halve!

Add in unemployment and low inflation, house prices are not likely to rise for some time.

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