London Report: FTSE ends on a high on strong economic data July 2, 2014 Britain’s top share index hit a one-week high yesterday, with upbeat economic data from the US and China improving investor sentiment and boosting cyclical sectors such as banks and miners and carmakers. The FTSE 100 index closed 0.2 per cent firmer at 6,816.37 points, after climbing to a high of 6,829.49, the highest level since [...]
As prices pass their 2007 peak, does the housing market pose a risk to the economy? July 2, 2014 Philip Lachowycz, economist at Fathom Consulting, says Yes. The mortgage lenders are again reporting substantial increases in house prices. And this is not happening from a position where property had become cheap – far from it. The current rises are happening from a base where, relative to incomes, the level of prices was already some [...]
What the other papers say this morning – 02 July 2014 July 1, 2014 FINANCIAL TIMES Facebook faces experiment probe A UK data regulator is investigating whether Facebook broke data protection laws when it allowed researchers to conduct a psychological experiment on users of the social network. The Information Commissioner’s Office said it was probing the experiment and planned to ask Facebook questions after widespread outrage when it was [...]
Bank of England sets its sights on landlords’ buy-to-let mortgages July 1, 2014 Buy-to-let mortgages could be the next financial product to face tough new limits, the Bank of England revealed yesterday, as the restrictions announced last week only cover owner-occupier loans. A housing boom and bust could hit landlords just as it would any other home owner, risking a serious blow to banks and the financial system. [...]
UK mortgage approvals drop to 11-month low as market cools June 30, 2014 Bank of England figures confirmed yesterday that mortgage approvals dropped to an 11-month low in May, even as the actual amount of lending secured against property rose to the highest level since mid-2008. There were 61,707 applications approved during the month, a drop of more than 1,000 from April and down from the 75,901 in [...]
Housing downturn would not derail the economic recovery June 30, 2014 RESEARCH released yesterday suggested that a housing market slowdown alone would not send the British economy into a crisis. The combination of climbing mortgage rates and increasing property prices would not be enough to derail current growth, according to a report by credit ratings agency Moody’s. “While a steeper slowdown in the housing market would [...]
London prime rents improve June 30, 2014 RENTS in London’s prime postcodes rose 0.2 per cent in the first three months of the year after a two-and-a-half-year decline, as a recovery in the lettings market began to gather pace. The capital ranked at the bottom of Knight Frank’s Price Global Rental Index, in 18th place, after rents declined by two per cent [...]
Letters to the Editor – 01/07 – Not a new normal, Best of Twitter June 30, 2014 Not a new normal [Re: Is Mark Carney right that the “new normal” for interest rates will be 2.5 per cent?, yesterday] Mark Carney has pointed to financial market expectations to support his assertion that the “new normal” for rates will be around 2.5 per cent. He is wrong. Financial markets do not forecast the [...]
Interest rates could jump back to five per cent – Sir Charlie Bean June 30, 2014 Outgoing Bank of England deputy governor Sir Charlie Bean said yesterday that rates could eventually go back to five per cent, the long-term average during his last interview as an official at the institution. “I think it’s plausible over the very long run that these headwinds will abate. It might well be reasonable to think [...]
Letters to the Editor – 30/06 – Bubble-mania, World Cup, Best of Twitter June 29, 2014 Bubble-mania [Re: Are the Bank of England’s mortgage lending restrictions likely to prove ineffective? Thursday] An interesting debate, but I’m unnerved by how casually commentators and economists throw the word “bubble” around without giving much thought to what they are actually saying. Would a rise in base rates cause the housing market in London to [...]