I think there is now some evidence that in the most speculative hot spots, a degree of common sense is returning. Investor interest in inner-city apartments is well down, and a number of proposed projects have been shelved. In addition, estimates of vacancy rates are being revised upwards and rents are falling.
If this interpretation is correct, it should in time be reflected in the normal statistical collections on credit and prices. But these statistics inevitably contain quite long lags, so they will be the last indicators to turn down. When we put the two sets of risks together, there are several possible outcomes.