Outlook for Homeowners Not Good
Capital Economics, a consultancy firm, has predicted a pessimistic scenario for homeowners. Due to the influx of homes for sale in the housing market and less buyers in the market, home values will fall. Property prices are expected to fall by a quarter by the end of 2012.
This drop could remove more than 42,000 from the value of an average home. This could lead to those new home buyers from the high cost years of 2006 and 2007 and even last year facing the problem of negative equity. Even those that have put down large deposits could see their equity wiped away with the outlook so grim. Economists expect home prices to fall 5 per cent by the end fo 2010, and an additional 10 per cent in 2011 and 2012. Pricewaterhouse Coopers has forecasted a decade of lower house prices with a start toward pick up is not expected until 2020. Those that may be considering a remortgage may want to seek out remortgage advice now.