Jon Cunliffe, who will join the Bank of England as deputy governor for financial stability next month, said the housing market is not in a bubble as prices are rising from historically low levels.
“It doesn’t look as if there is a bubble,” Cunliffe said in testimony to lawmakers at Parliament’s Treasury Committee in London yesterday. “The picture emerging is that prices are starting to rise, but we’re still coming back from a relatively low base, and of course it’s a patchy picture because there’s quite a dispersion across the country.”
Strengthening property demand coupled with the government’s decision to accelerate a plan to help homebuyers get loans has raised concerns the property market could overheat. BOE Governor Mark Carney has said fears are overplayed, while the EY Item Club said yesterday that Britain is in the midst of misplaced “hysteria” about housing risks.