"Real estate debt for banks is the pig in the python and the question is when it will be digested,” says Patrick Vaughan, a well-known European property investor. “It has looked like it would kill the python.”
The scale of lending across the world – with an estimated £3,000bn ($4,940bn, €3,300bn) of property debt outstanding in the US and Europe – and the ferocity of the crash has meant institutions have not been able to afford action such as in the early 1990s, when panicked banks dumped distressed property in spite of more moderate market declines....
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