Fall in home sales forcast

The Daily Telegraph
Huge fall in home sales forecast

Hometrack said it expected a 17pc plunge in the number of home transactions in 2008, as the market grinds to a halt. But it reassured homeowners that it did not expect prices to fall, factoring in a 1pc increase in the average property price during the year. It said it expected house prices to flat-line for the next 12 to 24 months. Director of research Richard Donnell said that, with homeowners stretched to almost record levels with their mortgage payments, house price inflation was already starting to flag. There was a risk that the slowdown would turn into a US-style slump, but it was more likely that prices would remain flat, he said. “The greatest casualty of the current slowdown will be property transactions rather than house prices,” he said. “Indeed, the next 12 to 18 months will be characterised by a general lack of housing for sale which will provide a support to pricing, although this will result in much greater price volatility within local housing markets.”