29-11-2007
New fears over UK housing market
News by Adfero for Simply Business - independent providers of business insurance, business finance, landlord insurance, buy-to-let mortgages & commercial mortgages.
There are renewed fears over the effect of the recent market difficulties for the UK's housing market.
According to reports by the Financial Times, there are concerns that given the rise of the inter-bank interest rate to 6.59 per cent, the UK's housing sector could be stymied by a reduction in banks' ability to raise funds for new mortgage loans.
The Council of Mortgage Lenders has warned that smaller lenders are particularly affected, as they are able to utilise fewer channels for the raising of funds, reports the Financial Times.
In related news, Bloomberg has reported that the value of sterling is declining in money markets as a result of speculation that the Bank of England will begin a period of interest rate reductions by the first three months of next year.
"There's a high probability, according to the market, that the Bank of England will cut interest rates,'' Kamal Sharma, a London-based currency strategist at Bank of America, told the news provider.