Thursday, Jun 14, 2007
Slowing, but still rising.
Bloomberg: House Prices Grow at Slowest Pace in a Year, RICS Says
U.K. house prices rose at the slowest pace in a year in May, a sign higher interest rates may be starting to cool Britain's property boom, the Royal Institution of Chartered Surveyors said.
"Affordability conditions are set to worsen across the board and will herald a cooling market,'' Jeremy Leaf, a spokesman for the London-based institution, said in a statement today. ``The full impact of rising rates is yet to be felt.''
Posted by little professor @ 08:50 AM (146 views) Add Comment
5 Comments
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1. paul said...
So then the Bank of England can rest easy on interest rates?
Not with
a high pound,
structural (not cyclical) inflation
rising dollar
high balance of trade deficit
rising prices in china
threat of rising yen rates
If Jewemy Leaf is whingeing now, there's a nasty surprise in store for the MPC and UK economy.
2. confused76 said...
With international financial conditions dominating(Asia, Euro, US), the role of MPC has been marginalized. They were there to prevent this asset bubble cum inflation mess. They failed. Situation is well beyond their control now, for complete lack of credibility. King now implements policies by speeches, not actions since his MPC does not support him.
I maintain that the international events will have far greater importance than whatever Mervyn & Co may do (or, more likely, not do)
3. cyril said...
The MPC's main job has always been to present an image of economic competence, to inspire confidence with global investors and keep domestic wages down for the proles (no problem with city bonuses of course - this doesn't count as wage inflation).
But it was all spin of course because MPC isn't independent and it can't control inflation.
4. confused76 said...
I just came across this reader's comment in the Times. Not sure we needed more proof, but shows what lunacy there is in the BTL market. Does he want to pay more, does he want to pay less? Does he want UK citizens not to be able to afford a roof to keep lining his pockets? How can he pretend he can make any return if he is overpaying for the assets? Where the f@*k is our government on this?
"As a keen investor I welcome the price rises to an extent. Suddenly, it allows us investors buy at the price that we are willing to pay for a property without it being inflated by huge demand as people are holding off buying and moving due to financial constraints. With fewer people able to afford their own home, it only re-inforces the need for a stable and reliance rental market that us investors provide. I look forward to slow down of the market to make some sensible and long term investments.
Mandeep , London"
5. inbreda said...
Wow Mandeep - what a well thought out argument.