I forgot to blog this at the time, but there was an very interesting article in The Economist a few weeks ago.
It was about a recent statistical study of recessions that had come up with some interesting results.
- House prices tend to fall 36% from their peak, and this fall takes five years. These two figures are fairly uniform.
- Equity prices fall even more, by 56%, but this is faster: Only 3½ years. These figures are also rather uniform.
- Rises in unemployment, on the other hand, varies a lot from one recession to another, but on average it rises by 7% over almost five years.
- And finally, the fall in GDP is typically 9½% over two years, but again with large variations.
In Glasgow, house prices started falling in the autumn of 2007, so prices are likely to keep falling until 2012.