Nationwide have recently warned that the London property market was heading for a ‘natural correction’ as the ‘frenetic’ pace of buying begins to slow down.
Graham Beale, chief executive of Nationwide building society said,
“We could be seeing the early sign of a natural correction in the London housing market.”
Property website Rightmove reported that asking prices for property in London have increased by £80,000 since January 2014, an increase of 17%, and prices in the capital are now roughly 30% above their former peak of 2007.
Graham Beale said there was already a “slowing down in the market place.” He added, “At some point buyers just start saying no.”
Ray Boulger, senior technical manager at mortgage brokers John Charcol, said the rate of increase in house prices in London was “clearly unsustainable” and “There are signs that the London market is topping out.” Despite a property bubble causing the financial crisis we have just hauled ourselves out of, we seem to find ourselves on the cusp of yet another.
Bankers and their objective of greedy returns along with the government with a specific agenda have allowed this bubble to inflate to increase their coffers and popularity respectively but as with the last bubble, this too will eventually pop.
With the Bank of England forecasting a six fold interest rate hike over the next two years, the financial hope for the future is tempered with the realisation that the new housing market crash could be coming soon.