RICS says 10% chance of property crash
The Royal Institution of Chartered Surveyors (RICS) reckons there's a "one-in-10 chance" of a housing market crash similar to that witnessed in the 1990s.
Simon Rubinsohn, chief economist at RICS, said he thought there was a 10% chance property values could fall steeply and a 20% chance that prices could fall by 10% in London over the next 12 months.
The move came as he lowered his view on house price growth over the next 12 to 15 months to flat from a previous forecast for 3% growth.
But the RICS man believes homeowners will probably not suffer a repeat of the inflation-adjusted 35% slump in house prices which began in 1989.
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Economists think UK interest rates may have peaked at their current 5.75%, with many suggesting this morning's monthly inflation data may prompt a rate cut at the end of this year or early in 2008.
UK inflation fell unexpectedly in August, extending its drop below the Bank of England's 2% target and raising the prospect of a possible cut in UK interest rates.
Figures from the Office for National Statistics showed consumer prices grew 1.8% on the year last month, down from 1.9% in July and the fifth consecutive monthly slip from 3.1% in March.
