The Bank of England’s latest Financial Stability Report includes the warning that Britain is in danger of a mass sell-off of distressed properties that would send values into a double dip and impair the lending ability of banks, reports The Daily Telegraph.
Lenders could be forced into selling a wave of properties as the stock of repossessed assets grows, in a move that could disrupt the supply-and-demand balance and place “significant downward pressure” on recovering property values, the Bank says.
The Bank warns that it would result in financial institutions being less able to supply credit to the wider economy if this risk were to materialise.
21/12/09 Daily Telegraph B1
