What are your thoughts on the state of the housing market in 2007 in light of the interest rate rise in January and climbing inflation?
Phil: Prices can’t go up at the same time as interest rates. There are two opposing influences at work and they don’t go together. What I think is happening is this: the top of the market is very strong with lots of city money and international buyers. They are stretching the market from the top end. These buyers, however, are not so affected by interest rates at least not in the same way as someone who has scrimped and saved for a mortgage of 95% on a £200,000 house. These are the people who need to sort out whether they can afford the debt in times of rising rates. The market will rise but it’s going to be an interesting year. Kirstie: I don’t think we have a national housing market now. It’s very regional for example in London. Of those properties selling for £5 million or more, 75% of buyers are from overseas. I recently heard about a £300,000 flat being bought it was for the buyer’s staff. That was another home taken out of the reach of first-time buyers. Prices are high in partic
