Tuesday, 8 April 2008
(click on the chart for a crisper image)
This is no soft landing. Today, the Halifax released their house price index for March. It shows that the UK housing bubble peaked in August. Since then, prices have come crashing down faster than anyone expected. Prices are down over 5 percent in just 8 short months.
The real,inflation adjusted crash is even more dramatic. Since the peak recorded last summer, the Halifax RPI-adjusted price index is down almost 8 percent. Moreover, since January 2005, prices are up just 5 percent in real terms.
The market is now falling apart. Banks are withdrawing their mortgages, the BLT market is dead and prices are crashing.