The UK mini-budget in September 2022 highlighted an already well-known problem: rising house prices have made traditional home ownership increasingly unaffordable and increasing interest rates will make it harder still. Affordability is still very stretched, but Edison Group believes that interest rates may peak at lower levels than the rate curve suggests, which means the sector may not suffer as badly as the current low price-to-book ratios of housebuilders suggest and there is significant upside potential in share prices.
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