Mortgages at 7 per cent
One of the largest building societies raises it. rates for new mortgages to 7 per cent and Mr. Crossman's rescue act becomes politically more urgent and less realistic. The cut in Bank rate, still at 6 per cent, neither reduces the pressure for mortgages nor provides the funds to meet them. The crucial factor is the tightening credit squeeze. The directors of the Bradford and Bingley Build- ing Society have probably judged the mood of borrowers correctly when they assume that its Clients would prefer a mortgage at 7 per cent to a refusal at 63 per cent. Availability is the key, and the building societies are finding it more and more difficult to attract funds. Mr. George Brown's airy election-time talk of 3 per cent mortgages is going to haunt the Labour Party for a long time to come. Mr. Crossman's Plan (when we see it) is not likely to be of more than marginal help to new owners, and none at all to existing borrowers.