| UK house prices are potentially set to fall by 6% | | | | credit crisis means that mortgages would become |
| over the next 2 years according to Capital | | | | more expensive, particularly for people with less |
| Economics bringing an end the recent property | | | | equity. Lenders are increasingly differentiating |
| boom experienced over the past 9 years. | | | | between lower and higher-risk borrowers in terms |
| The report has suggested that UK property | | | | of the mortgage rates on offer," it said. |
| prices are likely to fall by 3% in 2008 and 3% in | | | | This may prove grim reading to home owners |
| 2009. Last week, the Halifax announced the first | | | | and property investors. However a house price |
| fall in house prices this year. | | | | correction may not be a bad thing in the long run. |
| UK property prices are expected to follow Spain, | | | | If house prices do fall as predicted, some of the |
| France, Ireland and the United States by suffering | | | | heat will be brought out of the market bringing |
| from the end of the global housing boom. | | | | property price growth back to more realistic and |
| Ed Stansfield who wrote the report, said that | | | | sustainable levels. |
| affordability has worsened over the past 2 years, | | | | Property investors and home owners are going to |
| and that problems in the credit market would | | | | have to be much more realistic about the value |
| make it more difficult for people to remortgage. | | | | of their homes and property investments in the |
| The report outlined that monthly repayments on | | | | current market and avoid borrowing to much to |
| a new mortgage for a typical homeowner were | | | | move up the property ladder or when buying new |
| 16% higher than two years ago. The recent | | | | property investments. |