Business is booming.

UK's home owners can 'weather cost-of-living storm'

Housing market can weather storm of rising interest rates and tightness on the cost of living, according to city report

<!–

<!–

<!–<!–

<!–

<!–

<!–

According to a city report, the housing market can weather the storm of rising interest rates and the cost of living.

Homeowners are less exposed to interest rate hikes by the Bank of England than during previous recessions, even with a potential rise of 0.75 percentage points later this month.

Such an increase would bring the base interest rate set by the bank to 2.5 percent.

Robust: Mortgage lenders and borrowers have become 'more cautious' than in the 1992 and 2008 recessions

Robust: Mortgage lenders and borrowers have become ‘more cautious’ than in the 1992 and 2008 recessions

Mortgage lenders and borrowers have become “more cautious” than in the recessions of 1992 and 2008, when many home loans were taken out at fixed rates, Liberum said.

Analysts at the London brokerage also pointed to the strength of the labor market, with unemployment nearing 3.8 percent at its lowest point in 50 years and a high level of job openings.

That means people can ‘find jobs quickly if they need to’ and companies are less willing to lay off people because of concerns about hiring new staff.

In the early 1990s, interest rates rose as much as 15 percent, forcing thousands of borrowers to sell their homes quickly. Prices have also fallen in 2008.

A defeat in UK housing stocks last month has led to the sector’s ‘third worst month’ in 14 years, amid concerns about rates and inflation that could make housing less affordable, Liberum said.

But it said the sell-off of UK homebuilders’ shares was “too pessimistic” and that the property market is not headed for a crash.

Despite the “bleak outlook due to rising tariffs and energy costs,” the housing market remains stable, he added.

.