House Price Spy Blog

PM Gordon Brown will soon announce the second part of his aid package (the first part was lending £50 billion to lenders from Public coffers) that he hopes will see credit again readily available and prop up the housing market. Sales have falled to their lowest ebb for 30 years with just 32,000 mortgages were approved during October.

While a lot has been made in recent months of the lack of sales, only 4% of households in the UK are in negative equity which considering the inflated prices in certain areas of the UK such as London, Edinburgh and popular commuter centres in middle England is not surprising.

The worst part of this whole thing are the predictions (and they are just predictions) that over 200,000 people working in property and finance will be facing unemployment over the next 2 years.

When this hits we will really see the extent of the problem, with less money in the economy and no extra cash around manufacturing will suffer and prices will rise compared with earnings.

However many people are seeing a difference in their mortgage payments almost equivilent to a payrise, how long will this last? Can we expect Gordon Brown to think in the long term as it seems likely he wont have power this time next year! We are needing some firm guidance and planning for well into 2011/2012 rather than tax cuts to ewin the next election!