House prices 'act as a barometer' of consumer confidence

Posted: 06 Sep 2010 10:40:01 GMT

House prices in the UK are an indicator of consumer confidence, one expert has suggested.

Editor of What Mortgage Ben Wilkie said the drop in the cost of purchasing a dwelling for the second month in a row reflects the uncertainty of people in the country.

He explained the figures will not really have an effect on homeowners, but it will benefit those looking to buy.

"The only people who really struggle are people who need to remortgage and are quite tight in terms of money," Mr Wilkie added.

He claimed house prices are bound to be a "little bit more unpredictable" due to the UK's current economic position.

According to recent figures from Andrew Godwin, senior economic advisor to the ERNST and Young Independent Treasury Economic Model Club, there could be a double-dip in the housing market.

It revealed demand for unsecured loans is still subdued, which indicates a weak consumer recovery.
 

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