Debt management: Lack of job security holds down property prices

28/01/2010

Debt concerns following a lack of job security could be contributing to the steady prices in the UK property market.

Jon Brown, partner relationship manager at iammoving.com, has said that property prices are unlikely to rise as people struggle with difficult economic times.

"With concern still surrounding job security and economic stability - despite the recently reported end to our recession - it is difficult to see such dramatic increase in property value in our immediate future."

His comments follow yesterday's (January 27th) report from Halifax which found that house prices have increased by 105 per cent during the past decade.

Mr Brown added that the runaway mortgage lending of the last decade was to blame for the inflated prices.

Since 2007 prices have been slowly declining, and according to Mr Brown's suggestions and the Halifax report it looks unlikely that this decade will see such unaffordable property prices.

Kevin Still, director of EuroDebt, commented: "Many people have historically used property price increases to release 'equity' in their property and use it for debt consolidation purposes.

"EuroDebt work with many brokers and IFAs, who until 2007 were used to re-mortgaging clients every few years, taking advantage of the best mortgage deals and sweeping up unsecured debts. Many of these people are now in serious problems with credit card debts and unable to re-finance."

Tags; Income Worries and Debt,

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