Housing output should broadly stabilise during the course of next year, but clearly risks are to the downside. In general, however, the declines in both output and prices represent a movement towards a more sustainable position in the long term. Unfortunately the adjustment process is a difficult, if unavoidable, one.
The external environment Two fairly distinct sets of events are driving global economic developments at the moment. Firstly, housing market adjustments are taking place in a number of the major developed economies alongside associated difficulties in financial markets.