Govt needs to plan for housing crash

The government has been warned that it must plan for a housing market crash or risk a major disaster.

Vince Cable, Liberal Democrat Treasury spokesman, told BBC One's 'The Andrew Marr Show' that failure to prepare for a crash will lead to further problems.

"The worry about the housing market is that if there is a serious deterioration and if people aren't able to sustain their mortgage payments we're then faced - as we were in the 1970s - with a lot of people being repossessed, put out on the streets," he said.

The acting leader of the Lib Dems also pointed out that the "enormous" personal debt taken on by Britons in recent years means that many people are vulnerable.

"By comparison by other rich countries this debt is secured against house prices which are massively inflated," continued Mr Cable.

"And at some point all of this was going to come unstuck. And it is now beginning to come unstuck," he added.

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