A former Cabinet minister has likened the Chancellor to Pinocchio over his warnings that house prices would take a hit of as much as 18% if Britain leaves the EU.
George Osborne said a report on the short-term impact of Brexit, due for publication next week, will forecast people's homes will lose between 10% and 18% of their value by 2018 if Britain votes Leave in the June 23 referendum, compared to what they would be worth if the UK remains a member of the EU.
Read more: Gordon Brown: Brexit 'would send wrong message to the world about the UK'
With the average UK home costing £292,000 and the Office for Budget Responsibility predicting rises of 9.4% over the next two years, this would be the equivalent of depressing the value of a typical residential property by £32,000-£57,500 by the middle of 2018 - with much higher losses for more expensive homes.
But Iain Duncan Smith said the Treasury had failed to spot the recession and its forecasts were often wrong.
The former Work and Pensions Secreatry told Sky News: "When I heard that I did think of Pinocchio and the nose growing rather long here.
Read more: Remain looks odds-on to win but EU bloodfest will take years for Tories to get over
"Let me just remind everybody that it was the Treasury and George Osborne who said when we came into power in 2010 we couldn't trust Treasury reports because they were always fiddled with by Chancellors of the Exchequer.
Read more: Michael Gove warns staying in EU would mean migrant influx size of Scotland's population
"So, we gave that over to the OBR that is independent because we couldn't trust Treasury reports.
"Now what we have had is a whole series of Treasury reports telling us the world is going to end, we are going to end up with lower house prices, the economy is going to be bad."
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