The Telegraph, 9 January, Roger Bootle
Most forecasters got key economic aspects of the pandemic profoundly wrong. Perhaps their most striking mistake concerned the housing market, unsurprisingly.
If you had told just about any economist that GDP was about to shrink by a quarter, most would surely have concluded that house prices would fall. In the event, the opposite happened, and house prices have continued to rise during the subsequent economic recovery.
At the end of December, Nationwide reported that average house prices were up by 10.6pc over the year, the highest figure since 2006, and last Friday the Halifax reported a similar rise. After this experience, what should we expect in the future?
The first step in trying to come to a reasonable outlook for the market is to understand why it has recently been so surprisingly strong.
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