Reasons for high house prices ‘misunderstood’

Despite taking on increasingly high levels of debt in order to own their own home, British consumers are not fully aware of why property prices have risen so sharply in recent years, it has been claimed.

According to a poll by Propertyfinder.com, the influx of immigrants to the UK in recent years is seen as the second largest cause of rising house prices around the country, behind only the growing number of real estate investors.

Interest rates have risen in the recent months and put more pressure on those facing debt management problems, but only 6.3 per cent of those polled by Propertyfinder.com thought that low interest rates during the last decade gave house prices any kind of boost.

Warren Bright, the mortgage search engine’s chief executive, said: “Immigrants and property investors make high profile scapegoats but are simply too small in number to be responsible.”

“Ten years of low interest rates have brought about Britain’s high house prices, but this is poorly understood by most people,” he added.

Earlier this year, the Consumer Credit Counselling Service suggested that mortgage-related debt management issues would have British consumers “on the rack” financial throughout 2007.