Friday, June 27, 2008

UK: "House prices won't recover until 2015"

by Bill McBride on 6/27/2008 08:23:00 PM

From Edmund Conway at the Telegraph: House prices won't recover until 2015, ex-MPC expert warns

Families must wait until 2015 for the property market to start booming again, according to Stephen Nickell, who heads up the unit which advises the Prime Minister on housing planning.
"The housing market - in terms of the price of houses - will not look much the same as it did before the credit crunch until after six or seven years."
It's probably too early to be talking about when house prices will return to pre-credit crunch levels, but at least Gordon Brown is hearing that it will take years.

Also from the Telegraph: British household debt is highest in history
Families in the UK now owe a record 173pc of their incomes in debts, official figures have shown. The ratio of debt to income is higher than any other country in the Group of Seven leading industrialised economies, and is sharply higher than the 129pc of incomes it was five years ago.
Michael Saunders of Citigroup warned that - at 173pc of household incomes - the debt burden is higher even than Japan's when it peaked in 1990, before more than a decade of deflation.

"Not only are we the highest in the G7, we are the highest a G7 country has ever seen," he said.