House price fall threat to British economy

LONDON, Jan. 4 (UPI) -- British economists have warned a rapid fall in house prices is the greatest threat to the economy this year.

A survey of 21 leading economists by the Financial Times revealed Tuesday 75 percent saw a crash in the housing market as the most serious threat to economic stability.

"The biggest risk in my view is that there will be a large fall in nominal house prices and that will start a downward spiral in confidence," Andrew Oswald of Warwick University said. "I view this as likely."

Sushil Wadhwani, a former member of the Bank of England's monetary policy committee, said a housing market correction "could be deeper and longer-lasting than the current Bank of England forecast."

Some economists have expressed concern a fall in house prices -- which have risen sharply over the past few years -- could have a negative effect on consumer spending.