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- Title
The housing market and the wider economy.
- Abstract
In this speech, Kate Barker, member of the Bank's Monetary Policy Committee, discusses some of the factors which drive trends in the housing market. She notes the importance of improving the functioning of the housing market at all stages of the cycle. She discusses the uncertainties surrounding the current outlook and why the impact on consumption of a correction in the housing market is unclear. She highlights four reasons why warranted house prices may have risen recently: a front-loading effect (due to lower nominal interest rates); the fall in long-term real interest rates; the slow growth of housing supply; and a shift in household preferences towards holding more housing. In conclusion, she argues that, while understanding the housing market is important for monetary policy, the risks house prices pose are by no means the only (or even the biggest) risks to the present inflation outlook.
- Subjects
UNITED Kingdom; BARKER, Kate; PUBLIC officers; CENTRAL banking industry; BANKING industry; MONETARY policy; FINANCE
- Publication
Bank of England Quarterly Bulletin, 2005, Vol 45, Issue 1, p108
- ISSN
0005-5166
- Publication type
Article