Gazing into the real estate crystal ball - Mary Holm

0 per cent?

A. Nobody knows. That's the point really.

The main reason that investments with higher returns, such as shares and property, get those higher returns is because they are riskier than term deposits and the like.

Part of that risk is that we can't tell, in advance, what prices will do.

Nevertheless, economists are often prepared to have a go at property forecasts. BNZ chief economist Tony Alexander, for instance, says: "I think we still have a wee bit of upside left before a minor price correction starts later this year."

How big is minor? He expects average prices to fall about 5 per cent "from some point in the middle of this year to some point in 2005".

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