House prices to fall ‘up to 10% a year’

Uk HOUSE prices are likely to fall by up to 10 per cent annually over the next two years, ratings agency Fitch has predicted.

It believes house prices were still about 25 per cent above sustainable levels at the end of last year, having come down from an over-valuation high of 33 per cent by the 2007 climax of the housing market boom. Fitch cited “the weak economic outlook and restricted credit availability” in forecasting a further fall in UK prices of between 5 and 10 per cent by 2013, albeit with regional variations. Its prediction is based on a new house price model based on economic indicators including mortgage interest rates and employment levels.