In the near future, the housing market is going to fall. ‘Staggering’ new data has sounded the warning that the bubble will break

In the near future, the housing market is going to fall. ‘Staggering’ new data has sounded the warning that the bubble will break

According to economist Roger Bootle, despite the pandemic causing a recession that reduced the GDP by a fourth, average housing values rose 10.6%.

During the epidemic, government assistance programmes kept unemployment low, interest rates low, space demand low, and household savings high.

Traffic Scotland reported a multi-vehicle collision near Govan's junction 23 at 14:05 on Sunday.

A 56-year-old man died at the scene after authorities responded to a complaint about a suspicious individual on the M8.

It was a three-hour closure.

Earlier reports said multiple vehicles were involved, producing lengthy tailbacks.

Most analysts got crucial economic aspects of the epidemic incorrect, said the Eurosceptic commentator.

Unsurprisingly, their most notable blunder was in the housing market.

Mr Bootle, a member of Economists for Brexit, said mortgage payments presently average 38% of post-tax earnings.

Since cheap finance is still available, a housing crash is improbable.

Prices would undoubtedly decline if the so-called "affordability ratio" approached 50%, he claimed.

It has already boosted interest rates from 0.1 percent to 0.25 percent.

With inflation expected to reach 6%, many experts predict they will rise further.

While reducing inflation, many homeowners would have higher mortgage payments, and buyers may be unable to borrow as much.

Reduced affordability could cause price stalling or falling.

Mr Bootle said in the Telegraph: “If interest rates rise by only 2%, we will be entering price correction area on the affordability scale.

“Given the market's structural shifts, perhaps two percent isn't a critical amount.

“Perhaps it should be 3%.

“That would imply mortgage rates of around 4%, up from just 1.5 percent presently.

“In the grand scheme of things, this is not a huge amount.

Yet, with current mortgage debt levels, it would undoubtedly hurt the housing market.

“A correction may not be imminent, but if interest rates must rise substantially, as I anticipate, a correction is inevitable.”

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