Graz

http://news.bbc.co.uk/2/hi/business/4419823.stm

It's about time we had another increase to help slow down the housing market further Maybe they will do it in May.

OllyK

May the 6th?

Graz

From BBC....

OllyK

I wasn't far off!! Lol

ChrisB

Reading that link, some of the 'experts' reckon they could be going down.

I wonder what Mystic Meg thinks?

Harry_Boy

The housing market is only one element of the overall economy.

High Street spending has slowed down dramatically in the last few months, and the manufacturing sector needs realistic interest rates in order to remain competitive.

OllyK

We have manufacturing in this country?? Where did that spring up from?

Harry_Boy

Century before last I suspect.....

unclebuck

The motor trade is stuffed too. Nobody's buying.

Too bad. New Labour's so called 'stable economy' is a house of cards that's about to come tumbling down.

the moose

Looking at the picture this morning, I'd bet on it staying very flat for a very long time. The bank I was speaking to agrees with me (to the extent that an zero-cost interest rate hedge can be capped at 5.5% over a 5 year period, with a 4.7 floor).

Leslie

Sooner or later the borrowed money will be called in!

Les

davegtt

Like once a month for the minimum payment....

kammy

Considering esculating oil prices from OPEC, we and other Western nations need some sort of demand reduction. Pre early 90s it was all done via monetary policies despite the obvious side affects of stumping our growth for a year or two, and raising unemployment BUT it worked. We may end up having to follow that route due to North sea oil extraction set to slow down aswell. Hold tight, they will rise, or we are all screwed.
My 2pences worth IMHO.

matt85

I cant imagine it moving about too much either to be honest.

Housing market seems to be under control and other consumer spending seems to have been reigned in as well.

Vegescoob

You jest sir!
Surely not with Gordon in charge. My house will go stratospheric in value, I can withdraw equity and spend spend spend.

RB5-Black

Everyone who owns property tells themselves it's now stable. Folks who want to buy say interest rates are gonig up so they can get a bargin of a house.

Me .... My house has doubled in value, think I'll go buy a ferrari with my One account

Petem95

Interest rates probably wont go up any further for a few months yet - but even if they dont, the economy is still heading for a deep recession and the housing market has no direction to take other than a crash.

Funny how people think house prices cant crash unless rates go up loads - just look at what happened in Japan - much lower interest rates then we have had, house prices boomed, but when they crashed prices fell by as much as 90% - and remember Japan has a very limited supply of land too!

Brit_in_Japan

Property prices are still very expensive here, albeit not at the impossibly absurd values they once were. The 50 and 60 year mortgages are still quite common here, people expect their kids to take over the mortgage when they retire.

davegtt

Pete, think people aint saying there wont be a crash without high interest rates but all I see being banged on about here is people will be gobbling up them repossesions. well there wont be that many repossesions without high interest rates IMO

^Qwerty^

My wife works in high street bank doing loans and mortgages. The market is drying up, because just about anyone who was willing to take equity out of their property has done so. Hitting monthly targets is now hard work.

Looks to me like the economy is going to take a dive rather soon

It was good while it lasted I suppose.

Graz

It's true I suppose, I want to take my first step onto the property ladder and I'm hoping the rates go up a bit (not too much though ) to determine what the housing market is going to do. If everyone really is up to their eyeballs in debt then the increase in mortgage repayments could be the straw to break the camels back and set the market into a deep slide. For now the market is flat, well round here anyway, prices are either going up slowly or even dropping back a bit, I guess I have the increased interest rate to thank for that.

Therefore I have nothing to lose by waiting a while before buying my first house. So wish I'd bought one years ago now Hindsight is a wonderful thing as the old saying goes.

davegtt

Graz, but its all swings and roundabouts. IF IR's rise then the "cost" of purchasing your first home will still be rather expensive. the price you will pay for the property MAY be reduced from say last month but the morgage options available to you will make up for that "saved" amount. IMO there is never a right time to buy a house (unless of course they drop by 50% and we see no change in IR's...lol)

CLSII

Watched a program on TV a few months ago about a couple who started off buying properties and are now multi millionaires. Their advice was to buy if you could and just wait for the market to make you rich.

Seemed simplistic but if you can buy in the first place the market will always rise. My Mum and Dad bought a house many years ago that cost £7000 and had sleepless nights abought how to pay the mortgage, my first house cost £50,000 when interest rates were 15% , I had palpitations paying £230,000 for mine three years ago but I couldn't afford my house now.

Those people I know who have been waiting for the 'predicted crash' for the last few years have been left behind. A crash will only drop so far and is usually a minor adjustment.

There is never a good time to buy you just have to bite the bullet!

It flippin hurts at first but you get used to living on bread and water

dazc

Someone I know did exactly that.
Thought market had peaked, sold out and waited for the market to drop with a view to rebuy a similar property and make a killing.
It just kept going and going. He now has about half the money to buy his old house back & is renting. Doh

King RA

I bit the bullet and bought in Jan last year. At that time everyone was saying a crash was just round the corner. Luckily my parents in their infinate wisdom said it's never a good time to buy and just do it otherwise you'd be waiting forever. Luckily I took their advice as I'd never get the property now that I have, considering I really had to stretch then.

ProperCharlie

Of course, the market doesn't always go up - it goes up and down. People who bought at the last peak had to wait a decade or so before their properties achieved the previous value. In my area, prices are now back to what they were about 2.5 years ago, and I wouldn't be surprised to see them falling lower before we see a recovery. I bought my place, relunctantly, in 2003 - I thought that the market was getting overpriced at that time, but couldn't wait any longer. Also, 1/3rd of the value of this house was financed by the increase in value in my first place, so the way I see it is so long as the value doesn't drop to below 2/3rds of what I paid in 2003 (which sees very unlikely) then I'm more or less ahead of the game.