Home Buyers Should Take Notice of Emerging Housing Market
Homeowners have been warned by experts to prepare for rising interest rates in 2015. With many mortgage holders having been moved to their lender’s standard variable rate (SVR) after their current mortgage deal ended, they are at risk of facing unexpected interest rate increases. A SVR can be hiked with little notice and lenders are expected to increase their rates in early 2015 or even sooner should factors change such as tightened lending.
Once the Bank of England’s Monetary Policy Committee (MPC) begins to increase the standard base rate, it is expected to continue to do so in slow and steady increases. If a homeowner doesn’t prepare now they could face financial difficulties meeting the demands of higher mortgage repayments. Waiting to seek out a remortgage would have them seeking higher interest rate deals.
Just as homeowners should be preparing for higher interest rates, so should hopeful home buyers. Interest rates associated with mortgages are due to be higher in 2015 but properties are also going to be higher. More expensive property asking prices coupled with higher interest rates will mean that it will be a lot harder to climb onto the property ladder.
According to a report from Rightmove, a UK online property listing company, the average house price will increase by 30% over the next five years.
Home seekers should take notice of the inevitable higher interest rates that are to come next year, just as homeowners have been advised to do the same.