The Liberal Democrats claim that with net lending at record levels, Bank of England warnings that house prices are over valued are being ignored.
Vince Cable, shadow chancellor, says that with the value of mortgage loans up by almost a quarter, bank lending was fuelling an unstustainable bubble in the housing market.
He says: “If house prices fall the Banks will get their money back, but homeowners will suffer the consequences. People will be exposed to negative equity if there is a serious
downturn in the housing market.
“What is alarming is that nobody in the Government is taking action to address the inflated housing market. It is time for the Government to take action to protect ordinary homeowners against irresponsible lending.”