'Money is Still Tight'
I really liked the graph produced by HSBC via the Bank of England recently and which we have kindly borrowed below.
The graph shows how the flow of lending is still depressed to businesses via UK bank lending into the private sector. The graph also shows a fairly flat picture for lending to households too.
The chart shows how lending to both businesses and households fell away so dramatically with the onset of the ‘credit crunch’ in 2007/2008. There is no recovery apparent in the data as presented here. So the Credit Crunch continues or is it now a nervousness to borrow funds from the banks that is depressing the figures?. Certainly when chatting to some of our clients and corporate contacts it seems that many companies, as reported in the press, have been ‘nursing’ their cash reserves. Building money within the business to provide a buffer for any ‘unexpected events’ or ‘value’ opportunities. We are seeing signs that client investment in property projects is increasing markedly.
From new builds to property extensions; refurbishments and some speculation it does seem activity is increasing. Whether cash is coming from Reserves or from Bank debt is something we will only find out next year but more activity nonetheless has to be good news.
For information of any property investment or projects contact one of the Harris Lamb team on 0121 455 9455.