Government hubris on housing could lead to misery for millions, says Cable

10.00.00am UTC (GMT +0000) Fri 7th Dec 2007

Liberal Democrat Acting Leader Vince Cable has warned that a house market crash is a real possibility and that the Government needs to act now to ensure that millions of people do not face the misery of negative equity and repossessions. This comes after figures show that the average UK household debt to disposable income ratio is up from 92% 1997 to 152% today.

Vice Cable said "With the credit crunch now biting and the economy slowing we could see millions struggling to pay their debts leading them into mortgage arrears, repossession and negative equity. The Government should be working with banks to prevent large-scale repossessions and keeping families in their homes through properly regulated leaseback or shared ownership for families in arrears."