Trouble in Europe is bad news for UK housing market — June 2, 2012

The housing market is usually susceptible to changes in other markets and certain financial conditions always have an effect. Of course, the biggest financial issue affecting most of Europe at the moment is the Eurozone crisis and the trouble faced by Greece as a nation. The housing market is unlikely to escape the impact of the Eurozone crisis.

The property market has not seen much improvement in the spring. While it is often the case that summer time brings a good deal of activity in the housing market, this is not something that many forecasters and industry insiders are predicting this year largely because they expect that borrowing may become even more strained because of the concerns in Europe.

Mortgage lenders are struggling already and if they have to bear a greater burden because of the Eurozone crisis, they are likely to tighten their criteria for lending even further and they are also likely to increase their mortgage rates. This is only likely to slow down any improvement in the UK housing market and so the positive changes often associated with summer may never arrive.