SALES NEWS: Repossessions and arrears down but market prepares for rate rise
The housing market remains relatively robust but owners and new buyers are being advised to prepare for a possible interest rate rise in the next few months.
The fact that both repossessions and mortgage arrears are at record lows – as announced by the Council of Mortgage Lenders this week – is considered a reliable measure of the underlying strength of the housing market now.
However, mortgage broker bodies are also reporting an unusually busy summer as borrowers arrange new deals – frequently fixed over a long period – as a hedge against possible rate rises this coming autumn or winter.
However, the Bank of England pledges that any interest rate rise will be very gradual and many existing borrowers have already passed mortgage lenders ‘stress tests’ to ensure they can withstand any rise in base rate.