Homeowner sector ‘less affected by financial turbulence’
Posted 2007-12-9
According to the Bank of England, British homeowners are not as likely to be affected by the onslaught of the recent credit crunch as those without securable equities.
In a meeting held by the Monetary Policy Committee (MPC), they conjectured that banks are more likely to provide secured home loans than unsecured forms of lending.
And although the Credit Conditions Survey taken by the Bank identified an intention to raise the cost of lending to individuals, the committee members observed that “conditions facing the household sector appeared, for the moment at least, to be less affected by the financial turbulence”.
As a result, the New Year could bring an increasingly attractive proposition to homeowners during this transitional phase in lending.
MPC member, Professor David Blanchflower voted to reduce rates in October - the first time in three months that anyone on the committee had rejected Bank Governor, Mervyn King’s proposal to maintain the base rate.
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