The warning signs are everywhere.
With interest rates close to zero, and bank lending recovering, New Labour and the BoE might have engineered another property bubble. This is what they want. It is what they think can save them.
From today's FT:
The slump in the value of City of London offices has been so severe that it is now the only real estate hub in the world that offers a good deal for international investors.
No other office market has seen as swift an adjustment in price that would make sense for investors, according to the annual Money into Property report from consultancy DTZ, which covers 38 countries across Europe, Asia-Pacific and the Americas.
The report says that the outlook for global property investment remains bleak, with no respite imminent from falling values. For the UK, the period between 2008 and 2010 is forecast to see the worst cumulative returns for property since records began in 1921.