End of cheap credit 'will boost property'
The tightening of the credit market should result in the property
market becoming more affordable for first-time buyers in the
future, one industry figure has said.
According to Paul Holmes, chief executive of property company
Firstrung, cheap credit is likely to become increasingly difficult
to obtain for homebuyers as lenders become more cautious about who
they lend money to.
This will result in house prices falling due to a shortage of
buyers able to afford homes at their current price levels.
"The one word that is key here is affordability," Mr Holmes
"Affordability has been detached from the market place for years as
people have had access to cheap and easy credit and the market has
been pushed to insane heights."
Mr Holmes added, however, that it was unclear how long the market
would take to return to affordable levels.
"There is a correction on the way but just how long it is going to
take to turn around to the point where we reach affordability,
nobody can predict.
"It is going to be a long turnaround."