Property Prices Still On The Rise In The UK
In the light of the recent interest rate hike of 0.25% announced by the Bank of England, a study had shown that house prices in the UK are also on the rise, resulting in a double whammy for those trying to get on the property ladder. Figures that were recently released by the Halifax indicate that last month house prices in the UK rose by 1.7%, putting the annual inflation rate on property prices at 8.6%
With first time buyers already struggling to get their foot on to the property ladder because of the rise in property prices, the recent interest rate hike has made things even more difficult, as it means that first time buyers will need a larger mortgage because of the high property prices, and will have to repay more based upon the higher interest rate on their borrowing.
Although a number of building societies, banks, and lenders have now started offering ‘solutions’ to the problems experienced by first time buyers, some experts have stated that these borrowers could suffer in the long term. A number of lenders have started to offer mortgages over far longer terms, such as forty or fifty years, as well as offering up to five times the annual salary of the applicant subject to status. However, some financial experts state that this will mean tens of thousand of pounds more in interest for the borrower, as well as leaving them burdened with a high level of debt for decades.
The average house price in the UK now stands at nearly one hundred and eighty five thousand pounds. However, officials from the Halifax state that their house price index shows a ‘weakening in activity’, and that based upon this the rise in property prices is likely to stabilize rather than continue.
Alisdair Milton
16th November 2006
More Information:
- How long would you like you mortgage to run? The simple answer would be as quickly as possible, but not everyone can, which means higher repayments and more strain on the household budget.
- Your Home as Collateral For Other Loans
When you become a home owner you immediately open up more doors for yourself in terms of being able to borrow money to make things happen. It might be a business idea or an investment opportunity, but buying into property can open more doors than you might think.
- Mortgages – What Will Be Next?
Maybe some forty years ago mortgages were very solid things that you took out: you would stick with the same company for the entire period of the loan and you could find fixed rate deals that would also last the full twenty five years.
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How have Britons financed the billion of pounds spent on home improvements this year? Mostly through personal loans, although other forms of payments have been used as well.
