Housing market could 'silt' warns Nationwide

Prices jumped 2.1% in the past month alone – the biggest single monthly gain since June last year – which means annualised inflation has increased to 19.9%. Nationwide forecasts prices will increase about another 8% through the rest of 2004, taking total annual inflation to 15%. ”This is clearly unsustainable,” the lender writes in its latest report. ”In the current low inflation environment, real debt burdens will be slow to erode. Given this, borrowers need to take a prudent approach to the amount of debt they take on. Highly indebted home owners will find it harder to trade up, ...