Asian-based wealth management firm, “Sun Worldwide”, believes that the UK housing market has far further to fall as recent figures showed that mortgage lending in Europe’s second largest economy slumped by 60% in January 2009.
Britain’s housing market became more overheated than many others due to the high nominal prices being sought by vendors and the propensity of banks to accommodate borrowers seeking to secure loans their incomes could not realistically support.
“Sun Worldwide” is thought to believe that the market for property in the UK could fall another 30% before leveling out.
The figures promptly sent sterling crashing to below $1.40 on the foreign currency markets as worries increased that the nation will be find it far more difficult to emerge from recession than others due to its high level of consumer indebtedness and its crippled banking sector.
“Sun Worldwide” analysts believe that worse is to come in the property market as the Bank of England may be forced to raise interest rates in order to attract investors to government debt that has been issued to fund the unprecedented bailout of its banks.
