The Confederation of British Industry published a sobering report on the economy last week. The CBI lowered its prediction for GDP growth in 2008 by 0.2% to 1.8% and expects even slower growth next year. Its forecast comes on the back of ongoing turmoil in the credit markets. So, this week Mortgage Strategy asks…
How confident are you about the future of the UK economy?
Eamon Arlen, 50, park warden
There’s a chance we could go into recession but I’m confident we will avoid it. House building and commercial development have fallen and there’s been bad news for the banks but I haven’t lost confidence in the economy.
Cassam Looch, 28, freelance writer
I don’t think there will be a recession but I am concerned about the prospects for home ownership. I’m preparing to buy a property but I’m wondering whether now’s the right time. I’m sure other consumers are worried about their homes because a downturn in the economy would affect house prices. But I don’t think problems in the property market will cause a recession.
Guy Adams, 25, teacher
The US economy is struggling but that doesn’t mean we’re in the same boat. But although I’m fairly confident about the economy I have been put off buying a house.
Noella Tin, 35, consultant
The UK is probably in a better position than the US but there are problems in the housing market. I was thinking of buying a house but the banks have stopped offering 125% LTV deals so I can’t get on the ladder. But this is just one market – overall the economy is OK.
Jose Silva, 22, gallery manager
As far as I understand it the economy is going into a dip not a recession. The UK is in better shape than it was in the early 1990s and there is an underlying strength to the economy now, especially high employment. But I’m not totally convinced that the economy will be able to withstand anything. The government has borrowed far too much.
Eloise Hecker, 19, receptionist
I’ve not lost confidence in the economy. I tend not to worry when I see the press coverage about the US economy and the problems banks are having. I’m pretty sure the economy won’t crumble.
Philip Ilic, 22, film editor
I don’t think the problems in the economy will go far enough to cause a recession but for the next decade the rate of economic growth will slow down. This is because it will be harder to borrow money and get mortgages but wages will stay the same. As a result consumers will spend less.
Danny Carr, 22, researcher
I tend to look at the big picture rather than focus on a few press reports. I don’t see any immediate signs of a housing crash or a recession so the media coverage does not keep me awake at night worrying about the future. Plus, if there are problems in the economy and house prices fall, it will benefit consumers like me.
Andrew Leonard, 28, police officer
I’m not confident about the economy. I’ve just bought a flat but it seems problems in the economy mean lenders are no longer offering good deals to clients like me. I’m a first-time buyer and got an Abbey mortgage just before it cut its range.