Is The House Marketing Over Heating


by Tosif Patel - Date: 2007-01-03 - Word Count: 408 Share This!

Yesterdays news that UK November mortgage borrowing has risen to record levels, is bound to cause some upset at the Bank of England, with the housing market bounding along at a disturbing pace.

Despite many subtle reminders that the house buyer should be careful and not over stretch themselves, these warnings appear to be going unnoticed. Is it now time for the Bank of England to get tough?

There appears to be no other alternative for the financial authorities, except a short sharp shock for the housing market - something to stop the market spiraling out of control, and introducing a reality check. The mindset of the house buyer at the moment seems to be focused on short to medium term capital growth, as well as an over-riding desire to climb the property ladder.

At a time when many of the "seasoned" property investors may be about to consider reducing their exposure, are we seeing the final flick of the consumer tail, the final act of desperation to get onto the property ladder?

History will show that the time to consider disposing of an asset is when all around you are buying - "irrational exuberance" as the Chancellor famously described it. The market is so finally balanced, with many home owners borrowed up to and beyond their rational limits, that the first signs of a downturn will likely prompt a rush to the exit doors.

The number of approved house purchases in November grew to 77,788, up from the October figure of 74,997, and the highest level since June's summer market surge. The value of total approvals rose to £11.43 billion, a substantial rise on the October figure of £10.82 billion, and again approaching the June figure.

The only blue sky on the horizon can be found in the unsecured lending figures, which showed an increase of only £100 million from the previous month, which offers hope of a slowdown in consumer spending. There are hopes that this slowdown will spread over to the mortgage market, but the major mortgage specialists are reporting increased levels of interest and pent up demand which will be fulfilled over the coming months.

The softly softly approach of the Bank Of England appears to be nearing breaking point, and the reckless nature of recent borrowing, which has risen to 5 times salary in some areas, is forcing their hand. Expect the financial authorities to reaffirm there position in the New Year, with the housing market first on their list for 2007.


Related Tags: loans, marketing, housing market, house market, bank of england

Nokia 7373
T Mobile Phones

Your Article Search Directory : Find in Articles

© The article above is copyrighted by it's author. You're allowed to distribute this work according to the Creative Commons Attribution-NoDerivs license.
 

Recent articles in this category:



Most viewed articles in this category: