It’s that time of year when everyone makes their house price predictions…
Posted by markharrison on January 3, 2008
Yup, it’s early January again, the time of year when everyone makes a prediction about house prices.
Myra Butterworth, in the Telegraph writes (based on Halifax Estate Agents views):
- House prices in the South of England and Scotland are to soar […]Most of the country will see property values remain the same in 2008.
Over at the Times:
- … Estate agency Savills thinks [London] prices will rise by an average of 5 per cent in 2008.
- [nationally] more surveyors are reporting price falls, than price rises.
According to the BBC:
- For the first time since 1995, this could be a year in which property prices actually fall. […]However, that is not what most experts are predicting.
But Capital Economics remains contrarian:
- We expect house prices to fall 5% next year and by a further 8% in 2009, wiping out the gains of the last 18 months.
Back in November 2004, I wrote an article called “Prediction, Prophecy and Gambling” – the “current facts” in the article are, obviously, out of date, but the conclusion:
What we actually know is that, over the long term, house prices broadly go up in line with inflation, and over the short and medium terms, they vary wildly up and down with no detectable logic.
The moral of this story is not that you should never buy property in the hope that prices will go up over the next few years. The moral is that you should understand what you are doing – and be aware that a purchase in the hope that prices will go up over the next few years is a gamble, not an investment.
I still stand by that!