Outlook for UK property market dependent on mortgages
Published On 7 April 2008
The speed at which the UK's mortgage market "returns to normal" will have a large impact on the country's property market.Liam Bailey, head of residential research at Knight Frank, has warned that the current turbulent nature of the mortgage market as a result of the credit crunch is having an impact on property and that if it does not level out then "we have a problem this year".
Mr Bailey explained: "Price growth could be zero and it could be negative - it could even be significantly negative if people cannot get access to finance.
"But assuming that it does return to normal in the next two or three months, I think we will probably see zero growth this year in the prime markets - it won't be a disaster in the medium to long term."
He went on to say that while the city is coping with a difficult financial situation, "there are a lots of plus points for London at the moment" such as the number of jobs available at various banks.
Mr Bailey did warn, however, that the country is facing a "difficult 12 months".
