UK: House prices 'set to plunge by 9%'

Halifax Bank of Scotland spread more gloom in the banking sector today as it revealed £1bn (€1.3bn) in write-downs and warned that house prices could now fall 9% this year.

The grim property price prediction – a near doubling of the bank’s previous expectations – will cause its bad debts to rise as more borrowers struggle with repayments, said HBOS.