The Bank of England said the mortgages would be harder to obtain in the next three months amid fears of “a deterioration in the economic outlook”.
It reported lenders expect to find it harder to secure the cash on the wholesale markets to fund loans, while there were growing concerns about householders ability to keep up with their monthly mortgage repayments.
The warning comes amid consecutive rises in unemployment since the beginning of the year as
the Bank is warning that we could face a second credit crunch.
The latest house prices survey from Nationwide showed values dropping from 9.8 per cent to 8.7 per cent during the past year, bringing the cost of a typical home in Britain to £170,000.
Nationwide believes house prices are 27% above the 4 x income multiple trend line.
Author: Chris Slay
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