City bonus effect only part of the problem |
12 2008 |
| The effect that a lack of City bonuses will have on the housing market this year should not be overestimated. That is according to London Central Portfolio (LCP), which said that a number of factors are weakening the housing market. Many City workers will not receive bonuses this year due to the global credit crunch but the firm said that other factors will have a bigger impact. It means that now may be a good time to rent rather than buy as house prices could fall further. "The 'City bonus effect', combined with potential job cuts in this area, will doubtless have an impact on volumes of transactions and, to a lesser extent, average prices," commented Naomi Heaton from LCP. "However, it is essential not to overestimate this and realise that this is more a contributor to the wider concept of investor sentiment. "It should be noted that affordability is not purely dependent on the costs of property and borrowing. Exchange rates also play a key role," she added.  |
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