We’ve seen house prices soar over the past couple of years, but that looks to slow down considerably for a while at least, given the recent rise in interest rates.
Analysts have warned the base rate could surge to 6% next spring, after the UK’s Sterling plummeted in response to Chancellor Kwasi Kwarteng’s mini-Budget announcement. So is now the time to take a leap of faith and get in there before those interest rates rise even further?
Figures from Rightmove:
The average house prices at £365,173 in August, a decrease of 1.3% from July. Annual growth decreased from 9.3% to 8.4%.
Although it’s tricky to predict what house prices will do over the next few months, there is good indication that they will fall. It may well be a good time to look at a purchase if you have a 10% deposit and can truly afford the monthly repayments should the worst case scenario come to pass. If interest rates do reach an all time high, make sure that you are able to factor this into your figures before making that all important purchase.
Fall in House Prices Looks Probable
Again, we can never predict with certainty whether or not house prices will fall, but it is looking increasingly likely. While there is a lot of uncertainty, the property market has generally proven to be very resilient. The rises that have been seen over the last year or so are most certainly unsustainable, that’s pretty much a given.
It comes down to borrowing within your means and then some. Nothing in life is certain, and whilst we cannot predict our future employment or career path to the letter, we have a pretty good idea of where we are and where we are heading. A substantial deposit is great, but it isn’t the be all and end all. Being able to afford those monthly repayments without stretching yourself to the limit is an imperative part of the mortgage application process. This is probably the most important investment you will ever make.
Talk to one of our mortgage brokers today.