Rolling coverage of the latest economic and financial news
Introduction: House price inflation slowed to 0.3% in JuneBut annual house price growth still in double-digits, at 10.7%Nationwide: Tentative signs of a slowdownCrypto crisis: how digital currencies went from boom to collapseUK will face worse inflation than other major economies, says Bank governorTesco faces shortage of Heinz products after row over rising prices
Guy Harrington, CEO of Glenhawk (which provides bridging financing) says it’s ‘absolute madness’ to think house prices will keep rising in the current climate.
He warns:
“Another month of slowing growth is just a precursor to the sharp correction about to torpedo the UK housing market, caused by a perfect storm of record inflation, geo-political turmoil, rising rates and a once-in-a-generation cost of living crisis.
It’s absolute madness to think house prices will keep on rising. As caution grips the market, the outlook for 2023 looks increasingly ominous.”
Property prices have gone up faster than wages, creating an affordability squeeze, while mortgage rates have risen to levels we haven’t seen in a while. These factors, as well as the prospect of higher interest rates to rein in runaway inflation, are likely to go some way towards taming frothy housing prices.
“The housing market has already begun to show signs of cooling. Mortgage activity has started to come down, falling back towards pre-pandemic levels in April, and new buyer enquiries has waned – which is indicative of the inflationary pressures currently exerted on household budgets.
