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Now Goldman Sachs gives warning of property crash

House prices could fall much as 15 per cent if interest rates continue to rise, according to a senior economist at investment bank Goldman Sachs.

European economist Ben Broadbent says the housing market is vulnerable to a fall because it is overvalued, with prices likely to experience a 10-15 per cent drop over two years.

The Bank of England is expected to raise base rate next month although Broadbent says he is unsure what impact a major fall would have on the economy.

The prediction comes after fund manager Tony Dye, the former chief investment officer of Phillips & Drew who forecast the dotcom crash, claimed that house prices could plummet by 30 per cent over the next five years. Dye said rising pessimism about housing was justified with the Bank of England poised to raise rates.

But Broadbent does not believe that that a fall in property prices would spark a recession as households are better off than during the last housing market slump.


Eastender no match for pundits

After-dinner speakers at football matches are usually a low-rent assortment of booze-addled ex-players and past-it comedians but the hospitality organisers at the recent Champions League clash between Arsenal and Chelsea at Highbury decided to buck this trend with the frankly bizarre decision to employ Janine from Eastenders as a pre-game pundit. After being introduced by […]

Bankhall buys NU&#39s mortgage club

Bankhall has announced the acquisition of Norwich Union&#39s mortgage club, with the sale expected to be completed by May, 2004. Currently the fourth biggest club in the UK with 35 member lenders and 7,000 intermediaries signed up to it, NUMC joins Bankhall only months after the support services provider acquired Prudential&#39s much larger mortgage club. […]

Bankhall buys NU loan club and boosts brokers by 7,000

FSA chairman Callum McCarthy has spoken out against the EU gender directive, saying it is likely to hinder the development of an efficient insurance market. McCarthy has lined up with the financial services industry which opposes the equal treatment directive. He says the directive “runs counter to good sense” and is likely to increase the […]


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