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House market final props could soon collapse

Flight2quality · 2011-12-07 07:13:56

I said a few weeks ago that only two things were holding up UK house prices in the face of collapsing consumer incomes: forbearance on the part of the banks (changing the terms of mortgages and so on to prevent people ending up being in arrears) and ultra-low mortgage costs. This week, the scale of the forbearance in the…

Comments

Thrugelmir Posts: 89,546 Forumite

22 February 2012 at 7:47PM

Graham_Devon wrote: »

But the fact is, even the BOE got every prediction they made wrong. So much so they even had to expand their predcition fan graph for inflation.

The fact is that QE increases inflation as it depresses the value of the £. So imported raw material increases in price. Thereby putting upward pressure on UK factory gate prices.

So the BOE is fully aware of what's going on.

No-one said that rebalancing the UK economy was ever going to be painless. As "growth" alone is never going to provide the cure.

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