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Mark Carney must cool off an overheating housing market | |
(about 9 hours later) | |
Outlook Property is once again the hot investment commodity, as results from the buy-to-let lender Paragon clearly demonstrated. First-half profits grew by a fifth and the chief executive reckons lending could more than double in the second half. Clients borrowed £269.3m in the first six months of the company's year, and with a pipeline of £348m, it would be a surprise if his prediction doesn't prove accurate. | Outlook Property is once again the hot investment commodity, as results from the buy-to-let lender Paragon clearly demonstrated. First-half profits grew by a fifth and the chief executive reckons lending could more than double in the second half. Clients borrowed £269.3m in the first six months of the company's year, and with a pipeline of £348m, it would be a surprise if his prediction doesn't prove accurate. |
Which brings us to yesterday's increase in inflation to 1.8 per cent. That was probably down to factors such as a late Easter, and it still remains below the Bank of England's 2 per cent target. So there doesn't appear to be any real threat of an interest rate rise any time soon, despite what some commentators would have you believe. | Which brings us to yesterday's increase in inflation to 1.8 per cent. That was probably down to factors such as a late Easter, and it still remains below the Bank of England's 2 per cent target. So there doesn't appear to be any real threat of an interest rate rise any time soon, despite what some commentators would have you believe. |
Nonetheless, the Bank's Governor, Mark Carney, is right to be worried. With house prices rising at 8 per cent, the bubble continues to expand apace. He needs to find a way of deflating it gently before it pops. | Nonetheless, the Bank's Governor, Mark Carney, is right to be worried. With house prices rising at 8 per cent, the bubble continues to expand apace. He needs to find a way of deflating it gently before it pops. |
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