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HomeMiddle East NewsIRANThe aftershock of economic problems in England/housing crisis became more serious

The aftershock of economic problems in England/housing crisis became more serious

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According to IRNA, the banking giant Lloyds has predicted in its latest report that with the increase in interest rates in the coming months, the value of the property will fall to a record low. According to the estimate of this English bank, which is considered the largest provider of mortgage loans, the increase in unpaid loans, along with the upward slope of the inflation rate, will decrease 8% of the property value in this country.
Lloyds, which lost half a billion pounds in revenue in the third quarter of this year due to financial market volatility, has predicted that the UK economy will shrink by 1% next year.
This is while the economic situation of England is in the worst condition of the last half century due to several consecutive crises. The inflation rate has reached 10.1%, which is the highest level in the last 40 years. It is expected that this index will exceed 15% by the end of this year.
Meanwhile, experts predict that the interbank interest rate will reach 4% within the next two months. This index was 0.1% until last year, but it has increased by 224 basis points in the last ten months.
Economists predict that the interest rate will increase to 6% next year. The increase will add an average of £500 to the monthly mortgage payments of households struggling with the rising cost of living these days.
The spokesperson of a capital consulting organization in England known as Economics said that with the increase in mortgage rates, the number of people’s debt to the bank will increase and the forced sale of housing is inevitable in the next two years.
According to the data of the National Statistics Center of England, 6.8 million households in this country have mortgage loans. 4.8 million households live in rented houses, most of the property owners have mortgages.
On the other hand, reports indicate that one out of seven tenants in England has seen a rent increase in the last few weeks or month (August).
London’s Evening Standard website, quoting the shelter charity, wrote: Nearly 13 percent of those questioned in the period from July 28 to August 17 (August 26-6) said that the rent of their house had increased in the last month. .
According to the results of this survey, among more than 2,000 renters, nearly a third of them (32%) said that at least half of their household income is spent on paying rent. Three out of 10 renters (30%) said that they are always facing difficulties to pay this amount or are close to this situation.
This survey shows that 42% or two fifths of tenants have experienced a rent increase in the last year (2021) and one in 10 people (10%) have faced a monthly rent increase of more than £100.
Rishi Sonak, the new Prime Minister of England, who took the helm of the government last Tuesday, acknowledged the deep economic problems and announced that he has made addressing this issue a priority in the government’s agenda. However, he has warned about tough decisions to solve the upcoming problems.

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