King issues borrowing warning

The last 24 hours have produced a number of articles in the printed press about the UK housing market.

Many focus on the minutes of the last meeting of the Bank of England's Monetary Policy Committee (earlier in June). The meeting led to a decision to leave UK interest rates unchanged at 5.5%, though the minutes reveal that 4 of the 9 members of the committee were in favour in a further rise in interest rates. These included Mervyn King, the Governor of the Bank of England.

This news has increased speculation that July may bring a rise in interest rates, possibly taking them up to 5.75%.

Related news items consider what effect interest rate rises are having on the UK property market. Mr King gave a speech where he suggested that borrowers and lenders need to be careful to ensure that they don't over-stretch.

In his article in The Times ("Housing market studies differ on impact of rates"), Gabriel Rozenberg considers recent data on the UK housing market that has been released by the Royal Institution of Chartered Surveyors (RICS), the Halifax and by the Department for Communities and Local Government. The three separate sets of data appear to point in different directions when it comes to deciding whether the recent interest rate rises have led to the hoped for cooling down of the housing market.

Elsewhere, Bradford & Bingley have reported that they see the buy-to-let sector continuing to perform well during the remainder of 2007. This suggestion does not appear to be universally supported, judging from the media reaction.