More and more British homeowners are likely to struggle financially in months to come as a result of stretching too far to get on the housing ladder, according one economic expert.
Howard Archer, from Global Insight, has suggested that people who joined the property market by taking on a serious debt management burden in recent years will be among those most vulnerable to economic problems in 2008.
The rapid rise in house prices has meant that many British consumers took on large mortgage debts that are becoming increasingly difficult to pay off as credit conditions tighten and financial pressures intensify, Mr Archer has maintained.
“An increasing number of people have had to stretch themselves to the absolute limit to get into the housing market in recent times as prices soared,” he said.
“This means that they are particularly vulnerable to any adverse shock.”
The Council of Mortgage Lenders recently predicted that repossession rates will increase around the UK over the course of this year.