‘Sun Worldwide’, the Asian-based asset management firm, believes that the UK housing market will correct far more sharply than property commentators are prepared to admit.
The stark comments were reportedly included in a ‘Sun Worldwide’ client monthly update. Additional comments advised those with tracker-type mortgages to avail themselves of a fixed rate deal as soon as possible citing that it was highly likely that the Bank of England would be forced to raise interest rates in order to persuade investors to buy UK Treasuries.
A source close to ‘Sun Worldwide’ analysts said that it was unlikely that government efforts to make credit more widely available would result in a meaningful reversal of sentiment towards property as most people believe that property prices will fall far further and, consequently, are likely to wait.
The ‘Sun Worldwide’ source also suggested that the UK government would find their efforts frustrated much in the same way as their counterparts in the US who have tried in vain to arrest the decline in their property market.
“People who are worried about losing their jobs aren’t going to take on a mortgage on a property that’s probably overpriced anyway”, he said.
