Nationwide warns on UK housing
After reporting pre-tax profits of £117 million for the six months to 30 September, a fall of 63% on the corresponding period last year, Nationwide has today warned of "inevitable downward pressure" on UK house prices next year. This is a stark warning from a company which is well respected in the UK property sector and would appear have its " finger on the pulse" of the UK housing market. So what is the problem?
While the reduction in half-year profits from £322 million to £170 million is due to a mixture of low interest rates, reduce returns on loans and a "dramatic fall" in UK commercial property prices, the company is more concerned about the future. Nationwide has commented upon the expected slow recovery in UK economy but the main focus was upon the housing market where the company believes that a "lack of supply" has been the main reason for the sudden push upwards in the price of UK property.
Many people are concerned about the economic outlook for 2010 with unemployment set to remain high for some time, mortgage liquidity difficult to say the least and the potential feel-good factor created by the forthcoming general election soon to disappear.
Share this..
Related stories
Bank of England goes on the offensive
The Bank of England today invited a number of City analysts to a "teach-in" with regards to the UK quantitative easing program which will in the end see £175 billion injected into the UK financial system. A number of economic indicators over the last few days would seem to show that quantitative easing is not working, or at best having less of an impact than the Bank of England had hoped, somethi...
Read MoreTony Hayward to become scapegoat for BP
Tony Hayward, the current chief executive of BP, is expected to step down from his position with the group in early October with many seeing him as a potential scapegoat for the oil disaster in the Gulf of Mexico. It is believed that the announcement with regards to his future will be postponed until the oil leak has been plugged once and for all and the company will then be able to draw a line un...
Read MoreIs this the end of the hedge fund?
The collapse of the Bernard Madoff investment fund operation has placed hedge funds back under the microscope at a time when they are suffering more than most. These are funds which often take large and potentially risky positions in various investment markets which can result in substantial swings in asset values. They have been blamed for a number of short selling situations, in particular the U...
Read MoreUK inflation set to fall slightly
It is believed that UK inflation has fallen from 3.2% in June to 3.1% in July although this will not be enough to spare the Bank of England another letter to the UK government explaining why the level of inflation is well above the 2% target. However, the Reuters report which was used as the basis for the UK inflation figure for July saw some analysts suggesting that inflation could actually rise...
Read MoreHas Barack Obama joined the Tory camp?
As we move towards the G20 summit, to be held in London from 2 April, it has been confirmed that Barack Obama has arranged a meeting with David Cameron on the Wednesday he flies into London. This is a severe slap in the face for Gordon Brown who has for some time been hanging on to the coattails of the US leader.
There is a suggestion, apparently coming from the US camp, that the US...