The UK housing crash continues. According to the Nationwide index, prices fell 1.7 percent last month. Prices are down 9 percent from the peak last October. Furthermore, the crash has wiped out about two years of price appreciation. In fact, prices are now back to their August 2006 level.
How low can it go? Well, if the unprecedented and unsustainable upswing is any guide, then prices still have a long way to go before this crash has done its work. Will they fall 20 percent? Definitely. Could they fall 30 percent? Probably. Might they fall 40 percent? It is a possibility. What about 50 percent? It can't be ruled out.