Northern Rock housing market warning

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Northern Rock housing market warning

The chief executive of one of the UK's biggest lenders Northern Rock has argued that the first-time buyer market will be slow for the next couple of years due to the high levels of debt amongst young adults.

Head of Northern Rock Adam Applegarth added that this would cause the whole of the housing market to stagnate in the short term, The Times reports.

"The level of indebtedness among 18 to 23-year-olds makes it difficult for first-time buyers," he stated.

The continuing boom in the buy-to-let market also means that there are a low number of properties available that are suitable for first time buyers, which will contribute to the depression in the wider housing market.

Mr Applegarth issued the gloomy warning as Northern Rock unveiled record profits for 2004 of £431 million, which is up13 per cent on 2003.

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