House prices to fall by 4%

The collapse in home sales, and hit to households’ income and savings, means house prices will fall back. But lender forbearance and the fiscal package will prevent a surge in forced sellers, and with lending standards much tighter a repeat of the late-2000s crash is unlikely. We expect a peak-to-trough fall in prices of around 4% by early 2021, with values then flattening out for the rest of the year.