Brexit update

Mark Carny Warns a no-deal could see house prices plunge

The Bank of England’s governor has warned the cabinet that a chaotic no deal Brexit could send house prices crashing and send another financial shock through the economy.

Carney met with senior minsters on Thursday to discuss the risks of a disorderly exit from the EU. His worst-case scenario was that house prices could fall as much as 35% over 3 years.

The Bank of England regularly conducts stress tests, on a stress test carried out in November it advised a 33% fall in house prices could occur in a worst-case scenario.

Several reports have also said that the Governor told Downing street that mortgage rates could spiral, the pound and inflation could fall, and countless homeowners could be left in negative equity.

Carney has agreed to stay on as governor of the central bank until 2020.