TheCountOfNowhere Posted May 10, 2023 Share Posted May 10, 2023 Friend of mine who moved June 2022 ( proper peak mania prices ) is coming off a 5 year fix, in September, that they carried over when they moved. I did say to them they might want to try and refix asap but they admitted that the rates were so high they were screwed and just had to hope rates came down before they had to remortgage otherwise they'd be selling up. I didn't want to point out there will be no buyers. Does anyone seem mortgage rates getting back to 1% by September ? Quote Link to comment Share on other sites More sharing options...
henry the king Posted May 10, 2023 Author Share Posted May 10, 2023 Just now, TheCountOfNowhere said: Friend of mine who moved June 2022 ( proper peak mania prices ) is coming off a 5 year fix, in September, that they carried over when they moved. I did say to them they might want to try and refix asap but they admitted that the rates were so high they were screwed and just had to hope rates came down before they had to remortgage otherwise they'd be selling up. I didn't want to point out there will be no buyers. Does anyone seem mortgage rates getting back to 1% by September ? No chance. Mortgage rates are as low as they will go this year imo. We are back to the steady rises seen in 2022 prior to the mini budget. The falls at the start of this year were purely a correction from the mini budget rise. Mortgage rates are still higher than pre-mini budget. Mortgage rates will not go down because I think they are already priced for aggressive BoE cuts, and they are already priced on the basis of there being no margins (which will change soon as it has to) due to a pricing war. So they are priced as low as they can go. Any upside surprises to inflation and/or BoE hawkish statements and/or reduced expectation of rate cuts and/or resilience in labour market = mortgage rates rise. Quote Link to comment Share on other sites More sharing options...
gerkin Posted May 10, 2023 Share Posted May 10, 2023 On 09/05/2023 at 09:12, NoHPCinTheUK said: When do you think higher rates will start to reflect in prices demanded from sellers? I must admit that the resilience from vendors and EAs has surprised me. The housing market is the only one which seems not to adapt to new inputs. We’re talking about 0.x moves when rates are 400% higher than a year ago. People have been handed free money to just sit at home and do nothing for far longer than needed. Those people have gone and earned more money working as delivery drivers etc. All this free cash is sitting there being used by the people who never had any savings in their life. This is why the 10% inflation is having no impact right now. Once all that cash is used up we will see the real impact of high inflation and high interest rates. Quote Link to comment Share on other sites More sharing options...
Timm Posted May 11, 2023 Share Posted May 11, 2023 (edited) On 09/05/2023 at 20:41, Gurgle said: True. Do you have stats on how many people that might be. Can’t even fathom why anyone would “buy” a house on IO which is why I never even considered that tbh. 754,000 - 6.9% of mortgages, plus another 252,000 who are on part IO, part repayment, which means 10% of UK mortgages are at least part IO. Interest-only mortgages | UK Finance (The number of IO mortgages is falling fast though.) Edited May 11, 2023 by Timm Quote Link to comment Share on other sites More sharing options...
Gurgle Posted May 12, 2023 Share Posted May 12, 2023 On 11/05/2023 at 17:20, Timm said: 754,000 - 6.9% of mortgages, plus another 252,000 who are on part IO, part repayment, which means 10% of UK mortgages are at least part IO. Interest-only mortgages | UK Finance (The number of IO mortgages is falling fast though.) Just .... wow Quote Link to comment Share on other sites More sharing options...
fellow Posted May 12, 2023 Share Posted May 12, 2023 On 11/05/2023 at 17:20, Timm said: 754,000 - 6.9% of mortgages, plus another 252,000 who are on part IO, part repayment, which means 10% of UK mortgages are at least part IO. Interest-only mortgages | UK Finance (The number of IO mortgages is falling fast though.) I wonder how many of these have no plan in place for paying off the capital at the end of the term? Quote Link to comment Share on other sites More sharing options...
henry the king Posted May 12, 2023 Author Share Posted May 12, 2023 On 11/05/2023 at 17:20, Timm said: 754,000 - 6.9% of mortgages, plus another 252,000 who are on part IO, part repayment, which means 10% of UK mortgages are at least part IO. Interest-only mortgages | UK Finance (The number of IO mortgages is falling fast though.) A lot of BTL I expect. Same as a lot on variable rates are BTL. Quote Link to comment Share on other sites More sharing options...
BorrowToLeech Posted May 12, 2023 Share Posted May 12, 2023 On 11/05/2023 at 17:20, Timm said: 754,000 - 6.9% of mortgages, plus another 252,000 who are on part IO, part repayment, which means 10% of UK mortgages are at least part IO. Interest-only mortgages | UK Finance (The number of IO mortgages is falling fast though.) What is a ‘part IO’ mortgage? Quote Link to comment Share on other sites More sharing options...
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