MORE Trouble For Housing Market As Interest Rates Rise by 0.5%

MORE Trouble For Housing Market As Interest Rates Rise by 0.5%

 

The Bank of England have hiked base interest rates for the 13th time by 0.5% to 5% causing more misery and pain for beleaguered homeowners and further downward pressure on house prices.

 

The governor of the Bank of England, Andrew Bailey, said they have not ruled out further interest rate rises, pouring further anxiety on homeowners already struggling to meet the payments and cope with higher food prices and living costs.

 

The markets are already factoring in a base rate of 6%, which would be disastrous for mortgages and house prices as borrowing becomes unaffordable for residential and buy-to-let property investors. 

 

Buy-to-Let property deals no longer stack up at higher rates.

 

The average 5-year fixed rate mortgage is near 6%, but some borrowers were already facing 6-7% interest rates before this latest rate rise. Could we see a return of a 10% mortgage?

 

The housing market has already started to slow down, and this will add further stress to affordability as lenders have pulled thousands of mortgage products already.

 

One economist said that 50% of borrowers holding fixed-rate mortgages have yet to renew.

 

In January the FCA warned that, as many as 750,000 homeowners face default, which means they could be repossessed and lose their homes.

 

The Bank of England and the various men in grey suits that run the markets say that getting inflation down to 2% is their number one priority.

 

They are sucking billions OUT of the economy, making us all poorer with less money to spend so that demand falls – eventually causing inflation to fall. In effect, they are putting the country into recession, which means ordinary people will LOSE their jobs and businesses – Andrew Bailey, who helped CAUSE inflation by printing billions of pounds, will of course keep his job.

 

According to the IFS Institute of fiscal studies, 1.4 million homeowners will see a fifth of their disposable income disappear due to interest rate rises. That means less money to spend on going out, cars, houses and more money filling up the coffers of the banks!

 

The Bank of England have consistently maintained that inflation was “transitory”.  The governor also claimed that inflation will be down to 2% by the end of the year, another one of his so-called “moving forecasts” (a forecast they can make up as they go along), no doubt.

 

Good luck with that Andrew. This level of inflation can take years to beat, and the average time it takes inflation to come down from over 8% to 2% is 14 years, according to a former Bloomberg economist.

 

Another man in grey, the former Chancellor Norman Lamont, said a recession would not be too bad! How will it be for you Norman? Do you have a mortgage?

 

Lamont was in charge during the ‘Black Wednesday’ sterling crisis when the UK lost £5 billion when George Soros ‘broke the pound’ and interest rates went up twice in one day peaking at 15%, and going back to 10% the next day!

 

For the last few years, lenders have had to stress test mortgage applications to see if borrowers could afford the mortgage at a higher interest rates. This is all fine when living costs are not going through the roof. The cost of everything is going up by between 10% and 20% and will NOT be coming down anytime soon even if inflation slows.

 

House prices have been rescued by rate cuts and money printing in 2008 after the banks collapsed, and again 2020, but prices and transactions are now falling in the UK and in many other western economies.

 

Finally, spare a thought for Turkish people. The government has just hiked rates by 6.65%!

 

So what can you do to survive?

 

The government have met with the major lenders today. The banks have agreed to help borrowers by allowing product switches to interest only among other measures to be released. Your credit file will not be affected in the first six months.

 

Here are my money survival tips:

 

·        Talk to your lender – don’t bury your head in the sand.

·        Rent a room scheme.

·        Get a part-time job.

·        Learn how to manage your money.

·        Learn how to invest and grow your money into wealth.

 

See: – Transfer Property Into A Limited Company Without Paying CGT or Stamp Duty https://youtu.be/mtGq7WaVxLA

 

See also:

Housing Market in DEEP Trouble: https://youtu.be/USGREwntT1I

Interest Rates Will Rise, Property Prices Will Fall And Opportunities Will Open Up:

https://www.youtube.com/watch?v=ziTf2jOagB8&t=179s

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Is The Housing Market About To CRASH? Property Market Slowdown After Sta...

More Evidence Of Property Market Slowdown Post Stamp Duty Holiday

More worrying signs for the UK housing market have emerged following the ‘Stamp Duty property purchase tax’ holiday withdrawals, according to the Nationwide.

The leading building society own figures revealed that house prices dropped slightly in July compared with June, but were still 10.5% higher than a year ago, mirroring an earlier report by the Halifax, Britain’s biggest mortgage lender.

In the rush to buy, most stamp duty savings were outstripped by fast rising prices.

The tax break helped create a housing boom during the pandemic. Booms are often followed by busts.

A typical home cost £244,229 in July and annual house price increases were at a 17-year high in June, but slowed slightly in July, the lender said.

Breaks for property purchase taxes were pulled in Wales at the end of June, and reduced in England and Northern Ireland at the same time. The tax will return to normal levels by October.

The number of homes sold every month reached record levels not seen since comparable records started in 2005.

The market for large properties outside of town centres had surged, while sales of flats had fallen.

The number of transactions for properties bought for £500,000 or more increased by 37% over the 12 months to March, compared with a rise of 2% for all properties.

The search for space, indoors and outside, had driven demand for larger homes in which to live and work during the pandemic. Flats, without gardens and - in some cases - with issues over cladding and fire safety, have been more difficult to sell. Source: BBC News.

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How to make money in property whatever the market

Make money in property whatever the market is doing!

The UK economy fell by 9.9% in 2020, yet property prices went up, and the market is still hot!

House sales and property prices have surged amid government moves to stimulate the housing market.

New data from HM Revenue and Customs (HMRC) showed UK property transactions in March hitting the highest monthly level since modern records began in 2005.

The housing market has been almost immune to the Covid crisis as people rethink their lives and where they want to live.

Official data also shows average UK house prices rose 8.6% in a year.

HMRC figures show that there were 180,690 UK property sales recorded in March, which was more than double the number in March last year and 50% higher than February!

Many people are asking if prices will fall in 2021.

There are a number of factors which could prevent a fall in prices, one of them being the recent launch of a government-back 95% mortgage guarantee scheme to allow people to buy a property with just 5% down.

Another factor is that when governments have pumped billions into the economy asset prices, such as property, have usually risen – as they did after the 2008 financial crisis.

The truth is, nobody really knows for sure. Some experts are predicting a new boom.

In the long term, property has always gone up in value and there is still a massive shortage of housing in the UK.

But what if there was a strategy which enabled you to invest in property without risking your own money and makes money for you whether the market goes up or down?

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Will Mortgage Repayment Holiday End Lead To Mass Home Repossessions?

The Financial Conduct Authority, has announced that mortgage lenders can enforce repossessions of homes from borrowers unable to make repayments.

As many as 100,000 were on mortgage repayment holidays during the Covid lockdowns, but this came to an end this month. Even more borrowers have not been able to make repayments on loans and credit cards.

The term “repayment holiday” implies that borrowers are being let off, but arrears are added to the loan resulting in higher payments for borrowers already struggling.

Lenders must follow guidance on when to repossess and only use court action as a last resort.

The courts already have a backlog of all types of cases and bailiffs cannot be instructed by the courts until the end of May at the earliest in England and end of June in Wales, which means landlords may will not be able to gain possession of a property for several months.

Those unable to make repayments can no longer apply for a deferral on mortgage, loan or credit card repayments, however. lenders can consider individual cases of hardship based on their specific financial circumstances.

Will this lead to mass repossessions?

Probably not mass repossessions, but definitely an increase and more motivated and distressed sellers.

Unlike previous recessions, interest rates are at an all-time low – but watch out for those big step-up in payments after an initial fixed rate or discount, as well as HUGE FEES being added to the loan and increasing your debt.

In better news for home buyers, lenders can now accept applications for a new Help to Buy scheme in England. This is a less generous version than the previous scheme and is restricted to first-time buyers.

The Chancellor’s new 95% ‘mortgage guarantee scheme’ announced in the budget is due to be rolled out next year.

With stamp duty holiday ending in August and more people coming off the job retention scheme, the long property boom could be coming to an end. The question is whether or not governments can print their way out of the recession, with massive Trillion Dollar financial stimulus packages to prop up weak western economies, and avoid a looming worldwide depression.

Is it Possible To Start A Money Making Business From Home Without Capital Or Risk?

With pubs and restaurants closed for months during the lockdown in the UK and Ireland, it's a reminder of how vulnerable physical businesses, like pubs, restaurants and shops are to economic downturns or market changes.

At the same time, internet business owners are getting richer. Never in history has more goods been bought on the internet.

Even before the pandemic, the high street was already under pressure from online shopping, which has exploded in the last few years.

High rents, taxes and competition from the likes of Amazon and Shopify have driven large retailers, like Debenhams, out of business and forced John Lewis to start closing 70% of its 50 plus stores in the UK.

How does this help you get started online?

The internet has given small home-based businesses an opportunity to compete with the big companies which have dominated the market. They took the best sites in the high street and malls, and often drove small retailers to the wall with massive advertising and undercutting. Fortunately, this has now changed and that’s how you can benefit from the online bonanza.

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Sell solutions to people’s problems

Research your idea or product online – where else! You can check on Google how many people are searching for products or solutions to their problems. For instance, millions of people want to be slimmer and healthier, especially in these times. According to wordstream 450,000 people have recently searched for “how to lose weight” on the internet. Other ‘keyword’ searches like “diet” and “lose weight fast” had similar results. That’s just one niche!

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Now decide what you are going to sell and how and GET STARTED!

Decide what niche you want to be in and what you want to sell. Unless you already have your own products and business (which you may want to change based on your new research on what people actually want) you can start by selling other people’s products and services for a generous commission of between 10 and 50%. This is essentially how some of the biggest companies in the world make billions in profits.

Booking.com and Airbnb do not own their own hotels and Amazon helps millions of small retailers and authors sell online for a commission.

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