Barclays chief Antony Jenkins sounds alarm over boom in house prices and 'Help to Buy' scheme
Vince Cable cautioned against complacency on the state of the
nation’s economic recovery
Wednesday 11 September 2013
The debate over the Coalition’s efforts to kick-start the housing market intensified today as Barclays chief executive Antony Jenkins warned of a “property-driven boom” in the UK.
His comments came as Business Secretary Vince Cable cautioned against complacency on the state of the nation’s nascent economic recovery, saying: “There are risks, not least the housing market getting out of control.”
One of Britain’s biggest housebuilders, Barratt Developments, also underlined the impact of a clutch of Government props for the market including the Budget’s Help to Buy initiative, which has helped drive a 29% rise in sales in the last 10 weeks alone — but also drew fresh warnings from chief executive Mark Clare over the slow pace of house building.
Jenkins, speaking at a conference in New York, said: “We are seeing probably a more buoyant housing market for the first time in perhaps as much as a decade. That’s a bit concerning because there is the risk of a property-driven boom in the UK. The regulators are on it and don’t intend to let it happen but these things can be difficult to control.”
The Barclays chief added that “the sorts of things you’d expect to fuel economic growth in the UK still seem to me to be quite weak”.
Clare, who unveiled a 74 per cent rise in Barratt’s pre-tax profits to £192.3 million in the year to June, cited improving confidence and better lending conditions thanks to other initiatives such as the Bank of England’s Funding for Lending scheme as the housing recovery spreads beyond London and the South-East. He admitted: “We are all a little surprised by the speed of the recovery”.
Asked whether Jenkins had a point, he said: “I don’t think he has. Transactions are still 40% down on the peak and average house prices still 10%-15% down even before inflation. We are building half the number of houses we need in this country. Affordability will continue to be a cap on wages. People out there are still challenged.”
London, where Barratt saw sales rates jump by more than a third last year, remains a “very, very different market” according to Clare.
Prices on average are close to £300,000 but it sold the penthouse in its Courthouse development in Westminster for £3 million. The firm spent £1 billion on new land last year, and rival Redrow today increased its financial headroom for further land buying by £50 million.
Saudi businessman Mohammed bin Issa al Jaber is taking legal action against a US legal firm, White & Case, which he claims could see him sue Barclays for up to $10 billion (£6.4 billion). He has demanded that lawyers hand over documents relating to a 10-year-old “confidential” settlement between the bank and two Saudi Arabian ministries, which he claims damaged his business.
- 1 Notting Hill Carnival: Woman shares selfie after being ‘punched in face for telling man to stop groping her’
- 2 Keira Knightley topless: Usually conservative actress does own take on #Freethenipple campaign for Interview Magazine
- 3 Daily Show's Jon Stewart destroys Fox News for its Ferguson coverage
- 4 When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
- 5 Terror threat level raised to severe as PM warns Isis risk could last for decades
Keira Knightley topless: Usually conservative actress does own take on #Freethenipple campaign for Interview Magazine
YouTube video posted by Isis militants shows 'execution of 250 Syrian soldiers'
Botched ice bucket challenge leaves man critically injured after plane drops hundreds of gallons of water
Terror threat level raised to severe as PM warns Isis risk could last for decades
Isis 'A Message in Blood' video shows beheading of Kurdish man in Iraq
Robin Williams Emmys tribute led by Billy Crystal criticised for including 'racist' joke about Muslim woman
The Rotherham child abuse scandal is a tale of apologists, misogyny and double standards
Scottish independence TV debate: Pumped-up Alex Salmond bounces back in bruising second round against Alistair Darling
Do you realise just how foolish the UK looks?
Ukip Douglas Carswell defection: Tory MP jumps ship to join Nigel Farage
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
- < Previous
- Next >
iJobs Money & Business
£50000 - £80000 per annum + benefits+bonus+package: Harrington Starr: Data Sci...
£450 - £500 per day: Orgtel: SAS Business Analyst, London, Banking, Credit Ris...
£32000 - £38000 Per Annum Bonus, Life Insurance + Other Benefits: Clearwater P...
£200 - £250 per day + competitive: Orgtel: KYC Analyst, Key Banking Client, Bi...