Numis Securities, a city investment bank, has released figures that paint a very bleak picture for the housing market. They predict that the housing market which has already fallen 20% in the last 12 months could be set to plummet another 55%.
They put this dramatic predicted fall down to the fact that a lot of people who got into the buy-to-let market when it looked like a sure thing are now starting to panic as their investment loses them money. These people may flood the market and drag prices down even further.
Numis said: “It is the action of these amateur investors over the next few months which we are most concerned about,” the report says. “We expect some to begin panic selling their portfolios, with the peak volume as is almost always the case with private investors, being at the market trough.”
They are also very critical of the governments plan to force the banks to lend again at high levels. They cite the fact that huge level of debt appears to be one of the factors that drove this recession in the first place.
They save their most scathing criticism for the Prime Minister himself “Gordon Brown’s fingerprints are all over this economic wreckage and he should now have the decency to at least apologies for his mistakes.”
Very harsh words and one does have to wonder if they are completely justified.