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Press Releases
Old-fashioned values "could relieve credit crunch"
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The head of Wales's biggest building society has called for a return to "good old Welsh thrift" as a way to beat the credit crunch.
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Peter Griffiths, Chief Executive of The Principality, tells Βι¶ΉΤΌΕΔΜύWales's current affairs programme Week In Week Out that a move "towards old values, old culture, old thrift is probably good for society in general."
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And he tells Week In Week Out (Tuesday 13 May, Βι¶ΉΤΌΕΔ One Wales) that he would welcome a return to a world where saving is important again, where housing becomes affordable once more and where more emphasis is put on making sure people have a roof over their heads rather than treating property primarily as an asset.
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In a revealing interview at the Tenby council estate where he was brought up, Mr Griffiths says the credit crunch may not be all gloom, as people return to "proper priorities".
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He says the emphasis should be on people being able to afford their own homes.
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"When you question why people want to pursue home ownership then clearly a home has become far more of an investment now than a home and I think that is one of the fundamental changes over the last decades," he says.
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And he believes the credit crunch could provide a new creative impetus.
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"There is an opportunity for far more creative thought around support for first-time buyers, maybe through Shared Equity Schemes, and I absolutely believe that the Assembly could come to the party and help first time buyers to regenerate some of the market," he says.
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"If you don't have the opportunity to resort to the bank of Mum and Dad to find a deposit, trying to save a deposit is quite tough, because most lenders now will be looking for 25%."
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As well as Mr Griffiths's predictions on prices, Week In Week Out reveals the latest information on falling property prices and on who in Wales will be affected most by the economic downturn.
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Figures obtained from credit ratings agency Experian show the areas in Wales where people are most over-borrowed and who runs the greatest risk of negative equity – where the value of their loan is greater than what they can get for their house.
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Week In Week Out speaks to people caught in the agonising dilemma of whether to sell or to stay put until prices rise again.
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The programme also reveals those areas in Wales which have the highest concentration of people who are so-called "sub-prime borrowers", those with patchy credit histories and who are most vulnerable to worsening economic circumstances.
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Citizens Advice Bureaux in these areas say they are seeing more people unable to keep up with the payments on loans – those who have often been given 100% mortgages, equal to the value of their homes, and have extra loans on top secured against their property.
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With the cost of living also on the increase, many are now facing the repossession of their homes as they fall into arrears.
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The programme speaks to people who have already lost their homes or are about to go through repossession proceedings.
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Βι¶ΉΤΌΕΔ Wales Press Office
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