House prices may fall 7pc in year - Treasury
3:39PM Thursday May 22, 2008
By Anne Gibson
Falling house prices could make homeowners feel a lot poorer and might mean they spend much less in future.
Treasury has examined the risks of our roller-coaster residential ride coming to an end and reckons tougher times are ahead.
New Zealanders could slash discretionary spending on items like new flat-screen TV or the latest home computer if the Government's leading advisor on economic and financial issues is right.
In budget documents out yesterday, Treasury released its forecast of house prices saying they could drop 7 per cent by March 2009.
But it warned the decline could be more drastic because net migration could be lower than forecast and debt servicing might become more difficult if there was further turmoil in financial markets.
More
here .