This Chart Spells Trouble for UK House Prices

Two charts spell trouble for the UK Housing Market. Let’s take a look at them in this video:

There is little doubt that the London property market is overheated and in need of a serious correction. Low interest rates coupled with foreign speculation and government incentives have fuelled a huge rally in most of the UK house prices in the past few years.

But it it now time for a correction in house prices?

I certainly doubt anything like a 2008-style crash in the housing market. I don’t see any reason – both fundamentally or technically – why house prices in the UK should crash.

But investors who have been sitting on the sidelines waiting for a buy opportunity may get a chance if we should see a probable correction in the UK property market.

Two charts we watch are Savills Plc and Foxtons Plc. The chart of Savills’ share price did a good job of forecasting the UK house price crash back in 2007 and 2008. It also did a phenomenal job of foretelling the 2013 rally in house prices that has continued to flourish until recently.

Is the recent fall in both Foxtons and Savills a warning about where the UK house prices could be heading next? Only time will tell…

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