UK housing

The evidence is that the recovery in the UK housing sector is now petering out. Given the inability of the banks to lend and the persistent overvaluation of the UK housing stock, it is hard to be bullish. Whilst bad news for the perennial geared up bulls, whose ‘house is their pension’, it is largely irrelevant for the long term health of the economy. What the economy needs is not another bout of house price inflation but rather a long-term structural improvement in the external sector.