Bank of England Governor Mark Carney has securely parked responsibility for controlling Britain’s booming housing market with the Financial Policy Committee.
While presenting the Bank’s quarterly Inflation Report Carney said the first line of defence against risks from the housing market would be to restrain mortgage lending – something that is in the FPC’s remit – rather than adjusting monetary policy and driving up interest rates.
House prices are expected to rise 8 percent this year according to a Reuters poll this week, not far off the 11 percent average pace seen in the year to April.
That rise over the past year prompted BoE Deputy Governor Jon Cunliffe to say it was dangerous to ignore the momentum building up in the market.
“This is a movie that has been seen more than once in the UK,” he said.