David McWilliams: Expect house prices to hit the bottom next year
In July 2008, just as the falls in property prices were beginning to be really felt, this column threw up a chart of what had happened to the property market in Japan. It suggested that we would follow the Japanese path. Up to then, many people felt that the market would stabilise or lose maybe 15pc or, at a stretch, 25pc. The column contended that we would follow Japan exactly and prices would fall by 75pc. It seemed a radical forecast at the time.
Most of the commentary was still in the 'buy on dips' mode. This inertia is not surprising, given the long boom. Weaning yourself off a boom is like weaning yourself off any addictive substance -- it takes time to change behaviour.
Four years later, we can see that the Irish property market experience is a mirror image of the Japanese experience. But while it looks depressing, it may also suggest that we could see the bottom of price falls in the next year or 18 months.