Guardian UK: Warning that two million Britons may be out of work by Christmas as economy slows down

[marmar]

House price plunge fuels recession fear
Warning that two million may be out of work by Christmas

Larry Elliott and Kathryn Hopkins
The Guardian, Friday August 29 2008



Fears of recession this winter intensified yesterday after the CBI reported the weakest high street activity in 25 years, the Nationwide building society said house prices were falling at £150 a day and a Bank of England policymaker warned of two million unemployed by Christmas.

Amid predictions that 2009 could witness the first year of falling output in Britain since 1991, government hopes of mounting an autumn political comeback suffered a setback when employers' organisation the CBI and Nationwide both said they saw no let-up in the tough conditions facing retailers and the property market.

Gordon Brown plans to unveil proposals next month to revive the housing market and to help with soaring energy bills, but Downing Street sources were yesterday playing down talk of an "emergency package" of measures.

Nationwide said house prices fell for a tenth month, with the 1.9% drop in August taking the annual decline into double digits for the first time since the autumn of 1990. The 10.5% annual drop has shaved almost £20,000 off the cost of the average home and returned prices to their level of two years ago.

David Blanchflower, a member of the Bank's rate-setting monetary policy committee, said his earlier forecast of a 30% peak-to-trough fall in house prices now looked optimistic. .......(more)

The complete piece is at: http://www.guardian.co.uk/money/2008/aug/29/houseprices.property