Prices set to drop by 25 per cent says National Homebuyers

It is "silly" to suggest that the house prices are set to fall gradually and it is more likely that the housing bubble will burst.

[UKPRwire, Wed Nov 21 2007] That is the opinion of Firstrung chief executive officer Paul Holmes, who describes suggestions of price growth remaining at zero per cent and not falling drastically as "absurd".

He predicts a 25 per cent correction and says that the best homeowners can hope for is a one per cent decline every month.

Clearly, this is terrible news if you are looking for someone to buy your property but Mr Holmes believes that things are only set to get worse.

"I can't agree that you could simply have this perfect situation where house prices stop accelerating from a peak of 21-25 per cent nationally. To [predict a] sudden, gradual grind to zero per cent without severe collateral damage, I think is silly, quite frankly," he said.

"We're currently about 30 per cent overvalued. So, I genuinely predict a 25 per cent correction. But how long that is played out over, and how long wages take to catch up and normalise that correction, is anyone's guess.

"In 2008, I'd say we'd be looking at one per cent drops per month; a 12 per cent drop… But even that one per cent drop is in some respects idealistic," added Mr Holmes.

Quick sale property expert Julian King adds, "Finding a buyer is proving more and more difficult at a time where the homeowner is more and more unsettled with the market".

"Although predcitions of a 'bubble burst' are perhaps a little dramatic, we are facing a reduction in property prices across the UK and National Homebuyers is assisting many homeowners with a quick sale of their property.

"We predict next year will be a difficult year for many and we are happy to advise and assist with any homeowner needing a fast property sale".

Mr King is a director of National Homebuyers, the UK's leading quick house sale property company.

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