Houses Of Pain: Property Repossessions Will Rise
AS the dark clouds continue to gather over the housing market, the Guardian warns us that even small increases in interest rates will push up the number of repossessions in the UK to the highest levels since the crash of the early 1990’s.
According to Business Strategies, even a one-percentage point rise to 6.25% in borrowing costs would cause 55,100 homes to be repossessed in 2009, over three times last year’s total of 17,000.
While even if interest rates stay at 5.25%, repossessions are set to double over the next two years. According to Neil Blake of Experian, “Even if interest rates fall back in 2008, write-off rates [for bad debts] and repossessions are still expected to continue increasing until 2009”.
Of course, with that 100% mortgage, what’s new? The bank owns your home anyhow…
Posted: 26th, April 2007 | In: Money Comments (2) | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink
Comments
April 27th, 2007 at 5:58 pm
Over the last ten years, UK house prices have increased at twice the rate of wages. See:
http://ukhousebubble.blogspot.com
April 26th, 2007 at 2:44 pm
Hi good point, I’ve been been concerned about the possibility of rising rates since the it was publised that the government had missed their inflation target of 2%… It’s looking very likely we’re in for a 0.25% - 0.50% rate rise.
Probably now is the time to look for a fixed rate mortgage before the pain hits.