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UK DM: IMF Predicts Devastating UK Housing Crash

Chancellor's warning to homeowners as IMF predicts devastating crash

Daily Mail
By ALEX BRUMMER -
Last updated at 12:21pm on 18th October 2007

The Chancellor rebuked mortgage lenders yesterday for fuelling an 'unsustainable' boom in house prices.

In an exclusive interview with the Daily Mail, Alistair Darling said banks and building societies must be more responsible with their lending.

Predicting a 'slowdown' in the property market, he urged them to be more cautious about how much they lend and take more account of whether the borrower is able to pay back the loan.

His stern message coincided with a warning from the International Monetary Fund that Britain's economy, with its heavy reliance on property, was hugely susceptible to a housing-market crash. Mr Darling said he believed a fall in house price inflation was both desirable and likely.

'An unsustainable house price inflation is not good for individuals, is not good for the economy, so I think it will slow down,' he said.

In a wide-ranging interview, the first since he delivered his controversial 'magpie' Pre Budget Report last week, the Chancellor left little doubt about his irritation with the home loan providers. He demanded that they ask 'more searching questions' to prevent borrowers overstretching themselves.

Last year Abbey, Britain's second biggest lender, changed its rules allowing it to grant loans of five times the borrower's salary, and sometimes up to seven times.

Other lenders, such as Northern Rock and the Halifax subsidiary Birmingham Midshires, were willing to lend 125 per cent of the value of a home. Darlington Building Society offered up to six times salary with its Income Stretch deal.

The Financial Services Authority has also warned that one in ten homebuyers is taking out an interest-only mortgage.

These are popular because the monthly payments are cheaper, but a buyer must repay the original capital sum when the loan ends. The FSA said ten per cent of interest-only borrowers have no idea how they will pay back the money when the time comes, with many simply relying on a buoyant housing market to add equity to their home. Mortgage brokers have also been encouraging homebuyers to lie about their finances to qualify for huge mortgages up to eight times their salary.

'I think that lenders need to be clear that firstly somebody can afford to meet the repayments whatever they are – that they haven't overstretched themselves,' said Mr Darling.

In the early 1990s house prices crashed leaving borrowers with mortgages which were larger than than the underlying value of their homes leaving them in what became known as negative equity. 'If lenders take a more robust view of what they are doing that's not a bad thing at down but that is a relative thing because it has been growing so strongly.'

Clearly, the American 'trailer park' mortgage market which started the credit freeze which brought Northern Rock down has given the Government pause. The impact of the U.S. housing collapse and the emerging problems in Britain is evident today in the latest authoritative forecasts from the Washington-based IMF. It said house price rises in the UK, Ireland and Spain had been surging even faster than those in the U.S. before the recent market collapse, making these countries particularly vulnerable.

'Could a housing correction in western Europe be as deep as in the United States?' asked the IMF report. Its analysis 'suggests that house price overvaluation may be considerably larger … and there would clearly be a sizeable impact on the housing markets in the event of a widespread credit crunch'.

Forecast growth for the leading Western economies has been downgraded from 2.7 per cent to 2.2 per cent next year, with the U.S. barely expanding enough to hold down unemployment. The IMF says that UK output will expand by 2.3 per cent against a spring forecast of 2.7 per cent.

Mr Darling, who is heading to Washington for his first meeting of the Group of Seven richest countries tomorrow, says he will be pressing fellow finance ministers and central bankers for financial market reforms in the wake of the American subprime crisis and the Northern Rock fiasco. 'We have to make sure we have a far better surveillance system to spot these problems and take action to head them off,' the Chancellor argued.

In contrast to the IMF, the Chancellor is hopeful that even if house prices start to slow or even fall, we are not heading for an early 1990s style crash.

'I am confident we can get through this, but we are going to go through a turbulent period,' he said. 'That is why I downgraded my expectations for growth quite sharply because of what is happening in the United States and in Europe as a whole.'

He does believe that over the longer term there could be a correction in the housing market but it will take place in a orderly manner. 'What you want to avoid is a very rapid unplanned adjustment,' he said.

http://www.dailymail.co.uk/pages/live/articles/news/news.html?in_article_id=488206&in_page_id=17....

COMMENTS:

Your very last sentence - the quote of Mr. Darling, tells you everything you will ever need to know about a Labour politician. If it isn't planned, then it couldn't possibly happen. Just like a dinner party, eh - Alistair? Welcome to the real world - it isn't something you plan.

- Bv, Gold Coast Australia

This man and the Brown one before him should be in charge of Monetary Policy, but no, the very first thing Brown did was to duck and pass responsibility to The Bank of England, and this is what has happened, hidden, soaring inflation, runaway cheap borrowing, and an unregulated Mortgage industry where people have been able to borrow many times their salary to buy a home, leading to stupid property prices, and almost inevitably financial ruin for many of them. This man Darling is in no position to rebuke the industry for the state of the housing market. All that is wrong took place under the stewardship of the man who gave him his current job. Darling may, and I say may, just have about enough intelligence to realise that the clouds are getting darker, and of course he will, when the storm breaks be able to say that he did warn us. I almost forgot, the Yanks will have the blame, Darling can be counted upon to utter some fatuous remark on those lines every time he opens his mouth.

- William Owen, Cardiff Wales

Gosh! He's quick isn't he? I bet he is really proud of the NVQ in accounting he got from night school at his local technical college. This gormless prat is the chancellor? God help us!

- Andy King, Birmingham England

Sounds like he's getting in his excuses before the fact. It's pretty rich coming from someone who presides over an economy based upon debt and cheap immigrant labour which has seen the first bank run for over a hundred years. Where he's going to get the money to fund his hundreds of thousands of government jobsworths and the funds to squander on the workshy once tax revenues start drying up is a mystery. Probably by taking the government equivalent of a 10x income mortgage and taxing anything you can think of in the name of the environment and blaming it all on someone else.

- Simon, Chatham

The government must share the blame for the "boom" by their letting in an unsustainable and uncontrolled number of immigrants both legal and illegal for they all need to live somewhere.

- Exessayer, Marbella Spain

Maybe we should rebuke the entire Government for allowing mass immigration to play it's part in fuelling house price increases in the first place. This old NuLabour stuff is really irritating me now, always blame avoidance.

- Jim, London

What a load of tosh! It's the MPC's (dominated with pro-Brown doves) decisions since 9/11 largely responsible. The rate was cut SEVERAL times quite unnecessarily. Even within its remit there was no real need to do so. This resulted in a property and consumer boom. The MPC have had loads of opportunities to restore the rate back to neutrality but has failed to do so hence a massively unbalanced economy today.

- Cww, Suffolk

Darling and this Government are just a joke! Come out and say what he has would be laughable if the situation was not as potentially bleak as it may turn out to be. Darling wake up, you and your boss are culprits in this housing mess - you should have acted much sooner like 10 years ago when you came into Government. Brown et all were happy to take full credit for the economy when it was on the up (fuelled by huge borrowing) now that it looks like that finally this credit frenzy is blowing up they should also take the blame and be kicked out of Gov if Brown had the bottle to call an election!

- Ian, Surrey

The Labour Govt is the main architect of the credit boom. They tell the BoE and the FSA what to do. They also taxed all the money OUT of the high street, so they needed a credit boom to keep high street spending going.
Rising house prices also suited Labour for the same reason, as people used equity to remortgage to pay off unsecured debts.
Reckless lending was a requirement of Gordy's chancellorship.

- Surreyboy1, Surrey UK

Yes that's normal! Nu Labour 'predicts' it after someone else - and then blames someone else!

- Steve, London UK

Nothing to do with Brown’s strategy on low interest rates over the past 10 years then!

- Olderbird, Northants

Brown keeps telling us that Labour does not do 'Boom and Bust' as the Tories did. This looks like Boom and Bust to me. As per usual though this is not Labour's fault, it's the mortgage lender’s fault. I guess Captain Darling will soon get round to blaming the Tories even though Labour have been in power for the last 11 years.

- Gordon Grove, Henlow

It will be interesting to see what fiddles our MP's get up to, in order that they don't loose out but the taxpayer does.

- A. A., London, England

Hollow words from a rank amateur. The Chancellor and his predecessor have raked in, billions of pounds from direct and indirect taxation related to the housing market. One supposes that with the external pressure of an IMF report, Darling had to be seen to be taking action. He might just as well go and feed the ducks.

- Peter Ellis, Calpe, Spain

Pot, Kettle, Black.

- Threaded, Roskilde, Denmark

Who has fuelled the housing boom? NuLabour of course.
In a desperate attempt to artificially keep the economy going they have made it open season for Planning Permission. Why? Because all the health and safety, employment laws, bureaucracy and benefits systems, they have continually introduced have ensured that other jobs either disappear for good, go abroad, or don't even get created.
Employers now have to pay the NHS if a worker gets injured and requires hospital treatment, and yet this Government allows people from all over the World to walk in and use the NHS without any payment.
THIS LABOUR GOVERNMENT IS REAPING WHAT IT HAS SOWN.
They can't blame anyone else.
Why are they unable to admit they are to blame for anything.

- Gerry, England

It's people like him that causes the problem to accelerate. There has always been a drop in property prices every eight years or so. So property owners do not panic. If you have bought to make a quick profit, then you might panic, because every property drop keeps so, for about 12/ 18 months, then starts to slide upwards.

- Victor Arram, Westcliff on sea

If Gordon Brown scripted and choreographed Darling's statement, as he indubitably has, then why oh why did he sit on his hands and neglect this incredibly dangerous, destabilising issue for the best part of a decade in power, when it has been as clear as day even to the layman that the bigger the bubble grew, the louder the final bang.
And the trance of McLabour's arrogant mantra decreed that it was the end of boom and bust. Amen.

- Dave, Cumbria

Do I detect that our new chancellor is about to "help out" the house owner by more increases in tax? By making houses so expensive to buy and sell the market will collapse. Labour politicians do not like the average person having too much wealth it makes them independent and unable to be shepherded like the sheep they want us to be.

- Doug George, Antibes France

So why has Gordon Brown not said or done anything for each and every year of the past ten? Whose entire fault is this? They have been on watch during this boom in immigration and buy to let.

- Mr Reeve, London

Successive governments of course had nothing to do with it. I mean it's not as if banks operate under British law scrutinised by the FSA or anything. And I guess bailing out Northern Rock, which got into trouble from giving loans to people with no money and no jobs, didn't send out a message to the financial world that if they cock it up, the taxpayer will bail them out.

- Suraci, Exeter

Falling house prices is good news! Boom has always been followed by bust and the size of bust is determined by the size of boom. In the UK we have had a massive house price boom ...
For the last 10 years, egged on by greedy Estate Agents, mortgage lenders, TV property presenters we have cheered on selling property for the highest price possible. What we now need is an era (and it's coming whether we want it or not) where we celebrate buying property for the cheapest possible price. I will wait a couple of years before buying and then will haggle really hard to get the price down further. Not surprisingly I want my money to be spent on my family, savings, pension, bills, quality of life, my children, etc. not on Estate Agents income, mortgage lenders, solicitors, etc. The era of falling house prices is very, very welcome. High and rising house prices has done a huge amount of damage to the economy and that will become apparent in the coming years.

- Doug, Birmingham

And what were the government doing? Heads in the sand?

- Epimethean, Surrey

I do not recall the Government refusing the extra taxes and stamp duties raised by the all-inflationary house price booms. Come to that neither did the estates agents or insurance companies complain about the extra income they made. It was only the first time buyer who literally had to pay for other peoples' greed.
How easy it is to comment and be clever after you have taken the money.

- Geoff, N. Wales

This Government has a great capacity for locking the stable door after the horse has bolted. It has been obvious for many years that a more prudent regime in mortgage lending was required.

- Brian, Bournemouth, UK

Ten years and this Government have done nothing to stem the rise in property values. Home ownership should be within the reach of all not just those able to sell and buy to one another at ridiculously inflated prices. Builders, speculators, estate agents, land owners, solicitors, second homeowners and of course our grasping Chancellors have all contributed to this ever increasing cost of a home.
Now we have the European 'immigrants' exacerbating the situation even more.

- Marshfield, Salisbury UK

No doubt lessons are to be learnt from this despite that it has happened many times in the past both here and abroad.

- Cww, Suffolk

The Labour Govt cannot now pass the buck. Gordon Brown's 10 years perception of growth and stability was built on the back of rising property prices.

- Dec765, Watford, UK

This is pretty rich. New Labour have been in charge of the economy for ten years and now shove ALL the blame for the housing market on to irresponsible lending. Brown should have seen this coming five years ago but he did nothing to stop it.

- Sylvia, Taunton

So now we watch Gordon Browns financial legacy start to unravel. Its so sad for the people that have mortgages who borrowed from a dishonest system built on a stack of cards. Sell up quick and get into cash or national savings.

- Draven, Grimsby, Lincolnshire

I don't know how this government has the temerity to rebuke mortgage lenders and not take a long hard look at themselves. They were happy for the last ten years to take huge amounts in stamp duty without adjusting the rates in line with increased property values. Also if you lose your job the government let's you sink for months without offering any help. Redundancy insurance packages are very highly priced so we're left to the dogs why can't the govt intervene/help there somehow to offer homeowners a safety net? Homeowners get a raw deal from this govt but they're happy to take wads of cash from us. Shame on you and ten years of incompetence. This was your great economy Brown - it was built on the hardworking backs of debtors. How ironic that it wasn't until you took office that all this started to happen or was it clever timing on the part of Blair?

- Anon, London, England

What hypocrisy. It is the job of government to ensure that the economy remains stable and this man's predecessor not only sat back and allowed this to happen but encouraged it; as long as house prices were going up and people were borrowing and spending against the proceeds, it more than adequately suited his purpose.

Any first-year student of economics could see where this policy would lead and during the past ten years, government has received sufficient warning to change tack.

Bankers always have been greedy but hitherto they have erred on the side of caution to ensure their own long-term survival. Today’s financial institutions have discarded caution in favour of maximising profits from the massive debt burden that has been run up and those responsible don't give a damn about the consequences, because when the wheel finally comes off, they will be long gone with the money they made.

- Dr Richard Crow, Warsaw, Poland

This obsession with owning property has got to come to an end.
The banks are partly to blame especially those lending 125% this is playing Russian roulette.
People have been blinded by the monopoly money surrounding the sky high house prices.
Also there have been a lot of greedy property speculators who have also fuelled this dire situation.
I hope there is a correction in house prices it is long overdue.

- Stephen Holmes, Withington Manchester

It's not the mortgage lending so much as the irresponsible banks and their credit cards. Time after time we see people with several cards all maxed out trying to re mortgage out of trouble. Surely it would be simple enough to limit credit card lending after all why do people need five or six?

- Brian Russell, Buckingham England

I could have told him that years ago and I have a failed O level in economics!

- P M (Not No That One!), UK

This statement ought to have been issued by Gordon Brown five years ago when the housing bubble was already all too evident.

- Mike, Edinburgh

It is a just a bit rich coming from this Government. Borrowing is expected to be £4Bn higher than forecast in 2007.
But you can't really blame Darling; he's just a puppet on a string.

- Alan Walton, Leicester England

Bring it on! It is about time this country got its wealth from actually doing things and contributing to the world, rather than just inflating the costs of our crappy houses.

- Bob Macdonald, London

Come off it Mr Darling, you have allowed the people to become enormously indebted in order to pump up the British economy and instil a false sense of wealth and well being, so that you could cling to power and enjoy the material benefits that brings.

People have been spending more than has been earned. Pay back time is coming soon with its attendant miseries. You know this; it has been specifically crafted by your government. Britain may well be the world's 5th largest economy but Britons are less well off than many other countries with smaller economies. Britain is failing when measured by most things which mark out a nation as being civilised; Education, Health, Housing, Pensions, Transport, care of the elderly, Crime, Justice. I wish I could be sure that a change of government would change these things for the better, but politicians are blinded to their incompetence by arrogance, vanity and greed.

- David Bernard, France

What a plank..

It's the Banks' fault is it?

Don't make me laugh. House prices are going to crash, there's going to be a massive recession and Bottler Broon and his cohort of pinheads will be history.

Fasten your seatbelts, it's going to be a bumpy ride.

- Tony, London

Tell him to ask his boss about what is going wrong. He was doing his job for the last ten years.
It is BROWN who is the architect of all that is wrong in our country. He got away with it for so long and he will try to wriggle out of responsibility for it now.


- Roger, Brighton

Talk about trying bolting the stable door after the horse has gone! This situation should have been brought under control years ago. Now we have a country where young people have little to look forward to in the way of owning their own house and creating a happy family. And this provides yet another excellent reason for those with skills to leave the country. It is strange how there is so much Government interference in trivial matters but not in areas where people seem to suffer the most and where anyone with a little intelligence can see a bleak future approaching for future generations.

- Jeremy Stewart, Basingstoke, Hampshire

Pontius Pilate telling us their hands are clean of the problem of their making?

He has the temerity to rebuke the banks when the last Chancellor (no names mentioned) presided over the so called 'boom' debt-fuelled economy while they raked in billions through stamp and death duty taxes.

They have perfected the trick of taxing the same money several times over to squeeze the most from those keen to provide a roof over their family’s head!

They now have the 'bust' part of the equation to deal with - little wonder they had no stomach for an election!

- Dee, Midlands

Good grief! What next, an exclusive warning to avoid buying Northern Rock shares?
The words of caution are several years too late.
I can't recall any similar words from either the then Chief secretary to the Treasury, one Alistair Darling, or from Buggins Brown when he was Chancellor.
Presumably, as long as they could both crow about their successful handling of the 'economy' (the foundation of that 'success'), a rapidly expanding bubble of property prices, along with the underlying irresponsible lending and borrowing conveniently passed notice.
Now, any significant fall in those property values will deflate that 'success' because consumers will be unwilling to continue adding to their debt (usually referred to as 'consumer spending').
More oil needed on the stable door.

- M Collins, Leeds, England

No. I don't blame Alistair Darling at all.

I blame CRASH GORDON BROWN!

- Andy Peaple, Haywards Heath, England

I wonder if the Daily Mail will continue to drift towards nuLabour now that the bubble is starting to burst.

- Draven, Grimsby.Lincolnshire

Alistair Darling is the wrong man for the post of exchequer. When Labour came to power he promised to look after pensioners. Did he keep his promise; no he did not. Have the pensioners received a substantial rise in the past decade; no they have not however, politicians have enjoyed rises in salary and tax-free allowances I would not trust that man as far as I could throw him. I agree 100% with David Bernhard comments. An election would be the answer if; there was a real leader with guts to do the job.

- Mr Walter Brown, Eastbourne England

Can not agree more with David Bernard, France.

- Alan, London

Very interesting article. I have some friends here in Brazil who have started working in mortgages at their banks, and this is becoming a big issue here as interest rates are finally dropping, allowing people with lower incomes to get on the property ladder, instead of merely building their own small houses in not-so-good areas of the cities, country etc. Should the banks show a lack of responsibility here, it would be catastrophic for everyone.

- Christopher Hawley, São Paulo, Brazil

The introduction of University fees at £3k per year plus all the other associated costs will endeavour to ensure the next generation live on credit as a matter of fact.

The will be leaving university at an average of £30k debt, and that's before cars, houses, marriage so you see the loop runs on and on.

- Percy, Lancashire UK.

And when property values go down we will all get a rebate on our council tax? My council tax is based on the perceived value of my house. My house goes down in value then my council tax will follow soon after heh?

- Keith Jones, Hartlepool

Come off it Darling. This is all coming from your buddy, Gordon Brown, who encouraged ultra rich foreigners to settle in UK, be exempted from UK tax, and use their money to buy lots of houses in London and drive up prices to ridiculous levels. That was also fuelled by huge city bonuses, a lot of which went into the London property market because of more tax loopholes created by Mr. Brown. These buyers didn't mind- it was all monopoly money because Mr. Brown let them off paying UK tax. Everything Gordon Brown creates falls apart eventually- he neither understood nor cared what havoc he created- his only concern was to become Prime Minister at any cost. He got the title- the British people will now pay the cost.

- Doug, Glasgow

This guy is a politician not a money man. He talks to the British people in a condescending way as he blames the lenders. World markets predict you cretin!
Darling should return to a job he was good at: stacking shelves at a supermarket!

- George, Bath, UK

Come of it Darling, it has been the fault of NuLabour and a certain Gordon Brown that has allowed the money supply by 13% a year. This has fuelled the market and the chickens are coming home to roost at the door of 11, Downing Street.
Of Course, with this Government it is never their fault, always someone else's.

- Nigel, Wimbledon

If Gordon McBrown hadn't pinched so much money from pension funds and in taxes people would have invested elsewhere but property has always been safe in the long term. I just hope the papers don't create a crisis that doesn't exist.

- Roger Kingston, York

It wouldn't have anything to do with Mr.Brown and his artificially low inflation figures calculated from a shopping-basket which excludes food, mortgages, energy bills and just about everything which is going up and the "independent" Bank of England monetary policy committee and it's artificially low interest rates? No, of course not! 10 years is a long time in politics.

- Richard, Alicante, Spain

FANTASTIC!

40% correction is a minimum suggested in an ABN Amoro (sic) report back in April.

This country used to make things for other people around the world now we provide "services" that can be done anywhere by the cheapest bidder.

Time to wake up and smell the coffee.

- Symo, Exeter, Devon

Why did the government change the inflation target from one which did include some measure of housing costs to one which did not - the cpi measure?
If you wanted to control housing inflation this decision achieved the opposite.
This exclusion of housing costs from the official inflation figure contributes to the fact that the official inflation statistics bear no resemblance to the cost of everyday living.

- Im, NI UK

This is obvious and old hat. What about the 30% tax a year based on the value of your 2nd home in France or Spain that is going to be levied. When will they tell us about this. The latest bitch in all the European press.

- Gina, Fleet

Should have 'sold up and gone away in May' as the bankers say.

- Roger, Nottingham UK

As usual, everyone is to blame except this pathetic apology of a government.

- John Ball, Bristol

Pleased to see I am not the only one that thinks this Government is a JOKE.

- Spence, London

The problem with the housing market and mortgages is only partly caused by the banks being willing to lend such large loans to people who can ill-afford it. I think that lots of people are simply driven to take out such mortgages by the housing shortage. Without going into too much detail, the Government has made the problem worse by failing to build enough social housing, by allowing unrestricted immigration and by not passing more stringent laws to regulate bank lending. Many couples struggle to get on the property ladder as no other accommodation is available. Even as far back as 1977, it was an enormous struggle for my wife and I to buy a house when we were first married. My wife had only been qualified as a teacher a year earlier and I still had a year to go before finishing my accountancy exams. We bought an old property in a then run-down area and gradually renovated it. This was meant to be a stopgap but we still live here. This required much effort and sacrifice at the time.

- Mark, Poplar London England

What a bunch of whingers. Low interest rates were a global phenomenon, and many, many, many people took advantage of them to take out large loans and invest in property. So what's wrong with that? And did the government (or lenders) run out in the street to make people borrow this money or buy those houses? Certainly not. Individuals simply reacted to global market conditions. And yes, people have borrowed too much and house prices may well go down (it's on it's way to becoming a self fulfilling prophecy), and people who over stretched themselves will feel some pain.

This is not rocket science, nor is it the government or lender's fault. It's an entirely normal, natural and welcome market correction taking place and over the long term, things will be back to "normal", just at a different stage in the economic cycle.

Cripes, settled down the lot of you.

- Iain Mango, London

Much as I detested Tony Blair I believe that what we have now in Commissar Brown will be far worse.

- Charlie-K, UK

Mr Darling forgets the basic economic rule of 'Supply & Demand'
Last week we were being told that we need to build tens of thousands of new houses on green belt land due to the increase in the population caused by unrestricted immigration!

- Thomas, Dubai, U.A.E.

Well they say "Swings and Roundabout" that's the only way to describe the Government! Unfortunately the Government is just like a playground these days. It is time for a change! Get rid of Labour and come on you Tories! I don't think they'll do much better but they may start supporting our Police and other public services then we can deal with crime properly... rather than beating around the bush and complying with Europe all the time.
Why don't we support our own economy rather than trying to support everyone else’s while our economy and country crumbles around us! Tighten immigration at least until our economy is stable.
Oh sorry... I'm going off the issue, I'm a homeowner but I have always said that house price rises are "false economy" and still believe so. How can a house be worth 80,000 one year and the next year it's worth 150,000? When inflation and the economy in ratio, does not change that dramatically. I don't just blame the government but estate agents!

- Edd Edwards, Chorley, Lancs

How can this be when Blair/Brown were so often crowing about breaking the economic boom/bust cycle?

- Roy, Southend, UK

Reading all these E mails its obvious that most people are pretty aware of what is going on. Isn’t this just another insult to our intelligence. This government treats us as though we were all idiots, incapable of reason and easily fooled by their rhetoric.

- John, UK

I for one look forward for the crash then perhaps I can get onto the property ladder like some many other hardworking people.

- Sarah, Crawley, England

I feel sorry for the FTBers who have been forced to take out huge mortgages - most of them honest people who are not involved in speculation - but just need somewhere to live.

If the housing market falls - GB will be out of office before you can shout "macavity" as this was entirely of his own construction.

- P Db, London,UK

Well it was nevitable wasnt it, not content with destroying our pensions and our investments and encouraging debt in order to fuel their useless public sector spending they now want to ruin the only thing left which can earn money, our property!

He wont be happy until the entire country is on benefits (sorry, tax credits) and dependent upon the state and then he will have fulfilled the socialist dream of seeing Britain finally on its knees, its citizens working until they drop and with little or no services to support them.

Question, just how much effect is his completely unnecessary borrowing having on us? Shame he can't work out that he needs to pay of the debts he's creating in our name and that it would be nice to see some positive result from all of that, one day!

- Ian Whyteside, Yateley, Hants, UK