News

As we come to the year end there are signs that the housing market may be starting to climb out of the doldrums. It is still very patchy and many sellers have not adjusted there prices after the recession, so we have some houses going back up in price and selling whilst others sit and wait for prices to catch up with them post-recession. Just as we see signs of recovery, America is almost certainly going to put interest rates up at the end of this year or early next. This will no doubt send shock waves round the World as people fear the same happening at home.
In truth we are in a very different place in the economic cycle and I would not expect interest rates to go up in the Uk until 2017. That said the fear of them going up is enough to deter buyers. Many not wanting to commit knowing that the cost of borrowing will someday rise. However their choice is becoming clear, rents are now way above the cost of borrowing and you get no capital growth from rental, nor does rent ever come to an end, unlike mortgages. Rent just keeps going up. I feel the dawn will break soon, mortgage lenders are going to have to soften their approach to lending and buyers are going to be forced out of rent due to costs, buyers will also start to realise that interest rates going up is actually a good sign. It means the economy is healing, jobs are secure salaries are going up and inflation is still well under control. So instead of fearing an interest rate rise, we should all rejoice!
2016 may well be the start of better things.
All at Reid Estates wish you a Merry Christmas and a Happy New Year