Rumours of house price crash rejected

Property research group Hometrack has rejected a warning that house prices are set to crash.

14:02 05 October 2004

Property research group Hometrack has rejected a warning that house prices are set to crash.

The group has stated that it does not agree with a report by Capital Economics which claims that house prices will fall by 20 per cent.

Suggesting that the report "overplays" the severity of the housing market's future, Hometrack argues that property prices are stabilising, rather than on the verge of freefall.

According to its own research, there is a different story to tell, with property prices have falling by a total of just 0.5 per cent in the last three months; a figure that is not consistent with a price crash.

But John Wriglesworth, chief housing economist at Hometrack has admitted that house prices "have reached the end of the recent boom period".

However, he went on to say: "The economy at present is in no way similar to that of the early 1990s."

"There is more chance of the earth stopping spinning than an imminent housing market crash."