Indications look good for the housing market
10th January 2007
With the New Year now well and truly upon us and everyone returning to work following the Christmas festivities, the indications look good for both the housing market and interest rates for the coming year.
The general predictions from the Financial Press for 2007 seem to be that property prices will remain strong throughout the London area and prices are likely to increase over the next 12 months. The Halifax Property Report predicts that house prices in the capital are likely to increase by 8% in 2007 after achieving similar levels in 2006. A relatively buoyant regional economy and what is expected to be another record year for City Bonuses are likely to stimulate demand for properties in London.
Another driver for property prices in London is that a number of homeowners are choosing to retain their existing properties as rental investments rather than returning this stock to the market. This makes getting onto the property ladder for the typical first time buyer that much harder as there are fewer properties to choose from.
Now more than ever it is important to ensure that you are able to present your circumstances to a prospective Vendor and/or Estate Agent in the strongest possible light and we are continuing to find that applicants who have arranged their Mortgage in advance put themselves in a much stronger bargaining position than those who have not.
With regards to interest rates, the general expectation in the market is that there is likely to be another quarter point rise in the Bank of England base rate increasing the rate from 5% to 5.25% within the next few months. However, the expectation is that base rate is unlikely to rise above this level and indeed is likely to reduce back down to 5% by the end of the year.
We are therefore not expecting to see any big movements in the affordability of Mortgages or the types of product currently on offer.
If you would like to discuss your personal Mortgage requirements with a friendly, non-pushy Financial Advisor then please feel free to call Greene & Company Financial Services on 0207 328 3280. Our advice is given freely and without obligation.
Wishing you a happy, healthy and prosperous 2007 from Greene & Company Financial Services.