Property News

Thursday, September 14, 2006

IMF warn rates must rise

International financial watchdogs, The International Monetary Fund , have warned that interest rates must rise to cool the UK housing market.

Recently The Royal Institution of Chartered Surveyors revealed that house prices in the UK are now growing at the fastest rate since May 2004 as house prices accelerated for the fifth month running in August.

According to the IMF, interest rates must be increased from the present 4.75%. They say that house prices are ' overvalued by most conventional measures' and that house prices 'still look elevated, and could come under pressure in a rising interest rate environment'.

With house prices outpacing wage rises, they warn that soaring prices posed one of the biggest risks to the UK economy.

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