Wednesday, Nov 01, 2006

Why are house prices still rising?

MoneyWeek: Why are house prices still rising?

It probably hasnt escaped your notice that house prices are still rising. UK property is overvalued by any conventional, and most unconventional, measures. But because the housing bubble has lasted for so long, and because people are so scared of missing out on what they see as easy money (buy-to-let investors) or are scared witless that theyll never be able to get on the ladder (first-time buyers), theres now only two things that matter - how much can I afford to pay a month; and how can I get the loan?

On the first point, people are now only too happy to throw every penny of disposable (and some indisposable) income at their property quest. And if theyre over-optimistic in their assumptions and find their outgoings creep up over their incomes, well, who cares - house prices and wages only go up, dont they? And as for the second point - well, getting a bank to lend you money is getting easier and easier. Just ask Abbey

Posted by mary @ 10:33 AM (350 views)
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