Mortgages for purchases on the increase
The new Governor of the Bank of England, Mark Carney, gave a fairly broad hint that the bank’s base rate, currently 0.50%, will remain static for a few years yet. Some of the comment was based upon the current level of unemployment and it was suggested that, unless this rose above 7% nationally, the rate should stay low. Whilst there is no guarantee, much can happen in a short time financially as we all know, this is a real confidence boost for those people who are looking forward in terms of their borrowing requirements. This can relate to either mortgage, personal or business borrowing and the broad brush hint can be a means to boosting more confidence in all of these sectors. Of course, the downside of this is that savers may not get much of a return on their hard earned investments during a sustained low rate period.
For borrowers on a low rate base rate tracker the prediction may also be good news and for new purchasers there is every reason to feel more confident in an ability to afford a mortgage in the next few years ahead although a longer term fixed rate may still be worthy of consideration. It is never a bad thing to know what your monthly payment will be and for how long and this may be considered prudential financial planning.
We have noticed an upturn in property sales transactions in the last few weeks and have even heard that a number of properties have been the subject of multiple offers with would be purchasers vying hard to make a successful offer. None of us know if this is likely to be the norm moving forward but it is undoubtedly another pointer towards an upturn of confidence in the current market.
If you are looking to take advantage of very competitive rates in the marketplace for either a purchase or re-mortgage then ensure that you take qualified and independent advice.