Liquid error: wrong number of arguments (2 for 1) Carney won't make things harder for mortgage holders...yet | Marsh & Parsons Sales and Lettings Estate Agents London

Blogs, Press & Media

Carney won't make things harder for mortgage holders...yet

Wed 06 Aug 2014

Governor of the Bank of England Mark Carney speaks during the bank's inflation report news conference in London on February 12, 2014. The Bank of England ramped up its 2014 British economic growth forecast, and tweaked its forward guidance on interest rates. Gross domestic product was set to grow by 3.4 percent this year, a chart in the bank's latest report showed. The Bank of England has kept interest rates at their 0.5% low despite mounting speculation that some Bank rate-setters would be pushing for a hike given the improving state of the economy. Today's interest rate decision, which means the cost of borrowing will not soar for mortgage holders and businesses, will be the first since gross domestic product (GDP) figures for the second quarter showed the UK had finally emerged from its worst downturn since the Second World War. Lee Hopley, chief economist at the manufacturers' organisation EEF said: "There may be the perception, at least, that debate is intensifying on the timing of the first rate increase, but there has been little change in the data over the past month that would have supported a move this month. Hopley said that it was right for the Bank's Monetary Policy committee, which oversees interest rates, to "hold fire" and avoid a hike, explaining: "Activity indicators show the economy is ticking over, but there are still some risks that could yet trip up the recovery and the more closely watched data on wage growth is not evolving in a way which suggests that spare capacity is being eroded at a rapid pace." Signs of economic improvement have led some experts to speculate that one or two members of the monetary policy committee (MPC) could dissent on leaving the Bank rate on hold, which would be the first split vote over interest rates since July 2011. However, the voting breakdown will only be revealed when the minutes are released later. Nobel Economics Laureate Robert Shiller thinks so, and he predicted the 2007 house price crash. Ronnie O'Sullivan says a huge housing bubble (and crash) will happen. Or in his words: "Baby it's coming." The average price for a three-bedroom house in central London has increased by 729 a day over the last year, equivalent to a quarter of a million pounds, estate agency Marsh & Parsons said. The estate agent firm said the scale of house price inflation meant that prices rose by 19% since April 2013 to an average of 1.6 million, equivalent to 5,120 a week, or eight times Londoners' 658-a-week median salary. Less than one in ten properties in many parts of the UK are affordable to single house-buyers, according to the homeless charity Shelter. Meanwhile, three central London areas are completely unaffordable for couples with children or single people living on average wages: Kensington and Chelsea, Westminster and CamdenIt's JUST a garage. This tiny lawn in Chelsea sold this month for 84,000, and it doesn't have planning permission or right of way. It sold for 53,000 last September - and you can't do anything on it at all. So says independent research commissioned by Shelter. That boy has already started on his first house... It's cheaper to commute from Spain than to live in London. Sir Jon Cunliffe, the Bank's deputy governor for financial stability, has warned that it would be "dangerous to ignore the momentum that has built up in the UK housing market." He also said that the housing market was the "brightest light" blinking on the dashboard of financial hazards that the Bank monitors. While arguing that Britain is not showing signs of a housing bubble, Broadbent admitted that it may be easier to spot with hindsight. "Bubbles are things that are things that are far easier to identify after the event than at the time," Broadbent told Radio 4's Today programme. Rates have been left at the historic low of 0.5% since the height of the financial crisis in 2009 to try to nurse the economy back to health. But the accelerating recovery has spurred pressure to lift the cost of borrowing back to a more normal level, with recent official figures showing that GDP had finally returned to its pre-recession peak in 2008.

Contact our office

Close

Contact our Lettings team

Close

Contact our Selling team

Close

Contact our About us team

Close

Contact our Corporate Services team

Close

Contact our International team

Close

Contact our Land and New Homes team

Close

Contact our Professional Valuations team

Close

Contact our Professional Services team

Close

Contact our Property Management team

Close

Contact our Riverside Properties team

Close

Contact our Career team

Close

Contact our office

Close

Request a viewing

Close

 

Close

Share this with a friend

Close