Eddie George, governor of the Bank of England, has warned that interest rate hikes may be on the agenda as house prices continue to spiral upwards. The increases in house prices have led to increased consumer confidence and people are spending more. He said: "We do not believe that the current rate of house price growth is sustainable but it is a driving factor in consumer spending".
Part of the boom is blamed on the increase in second property ownership and 'buy to let' mortgages which is squeezing availability for first time buyers and fueling price increases. Many are calling for measures to slow down the 'second property' market.