In The Week magazine: will the property bubble burst?
Prices are rising at the fastest rate since 2006, but the Chancellor insists its sustainable
THE British are in love with bricks and mortar again; house prices are rising at the fastest rate since 2006. But are we witnessing the swelling of a dangerous asset bubble or a sustainable growth in values?
George Osborne insists it's the latter. Despite "double-digit percentage point rises in some London hot spots" the Chancellor believes the new housing boom poses no threat to the British economy.
Many economists aren't convinced. The uplift in the housing market will "be sustainable only if workers' future wages justify the mortgages granted against them", warns The Economist. That won't be the case if Britain remains on its current path of "low investment, poor productivity and weak wage growth".
The housing revival is one of the main stories covered in Issue 933 of The Week magazine, available at newsagents now.
If you share the Chancellor's bullish outlook, it might be worth splashing some cash - £2.9 million of it – on Gallery House in Perthshire. The modern house, part of a new development on the edge of the Gleneagles golf course, features in our weekly property spread.
Relax in the hot tub after playing 18 gruelling holes and catch some sleep in one of the five bedrooms. Before you're forced to rent them out.