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Confidence in US housing higher than UK

By Jonathan Dawes, Thu 11 Sep 2008 - Published in Mortgages

Investors are showing more willingness to invest in the US housing market than in the UK, it has been claimed.

According to Carlo Walther, head of business development at Rightmove Overseas, the strengthening of the dollar shows the increased confidence the money markets have in the dollar compared to the pound.

He explained that investors were expecting the dollar to strengthen further due to the low base interest rate in the country.

Mr Walther added that the government's decision to bail-out failing mortgage giants Fannie Mae and Freddie Mac suggested the authority was "very committed" to bringing the housing market slump to an end.

"This is another reason why people have more confidence in the US market than they have in the UK market, which is why investors who would typically buy buy-to-let in the UK are now looking at the US market," he concluded.

In July, it was widely reported that Fannie Mae and Freddie Mac owned or guaranteed around $5.3 trillion (£3 trillion) worth of home loans - approximately half of all outstanding mortgages in the US.