Date published: 2007/08/06
The BBC says:
The average cost of a house in England will break through the £300,000 mark in the next five years, research suggests.
The National Housing Federation (NHF) warned prices were now almost 11 times the average wage and may rise by 40% as supplies fall further behind demand.
To avoid a looming crisis the NHF urged the government to act on its promise to build three million homes by 2020.
Recent rising interest rates and repossessions have led other analysts to forecast falls in house prices.
The NHF said a housing crash was unlikely despite first-time buyers finding it tougher to afford a home.
According to the report many of those priced out of the housing market are now turning to the social housing sector - as a result housing waiting lists have grown by 57% over the past five years to 1.6 million households - or four million people.
This is a report by a special interest pressure group, in this case an umbrella organisation of housing associations. So of course the aim of any report by them will be to push their special interest, in this case the social housing sector. Unfortunately the housing problem is a problem for everyone, not just the people at the bottom of the ladder. And the only way to solve the problem is indeed to build more (decent) houses where people want to live. If there were enough houses we wouldn't need much of a social housing sector. Unfortunately not many decent houses are being built. (In Cambridge, most money is being thrown at flats, which is not what most people want to live in. And what new houses there are have been pretty horrid on the whole.)
However predicting house prices, even just five years into the future, is a mug's game. You can say whatever you want, and give plenty of credible reasons why your forecast is brilliant. Fortunately five years into the future nobody will remember any of your forecasts. Here, in the UK housing sector, prices are overblown right now, and inflation is not obviously contained so interest rates might remain high(ish) for some time, so house prices could just as easily fall by 20% as rise by 40% by 2012.
_________________________________________________________
All material not included from other sources is copyright cambridge2000.com.
For further information or questions email: info [at] cambridge2000 [dot] com
(replace "[at]" with "@" and "[dot]" with ".").