Monday, August 13, 2007

Fears grow that further interest rate rises will trigger a propertry crash

Property price fears fuel increase in rentals

Rental demand is increasing according to ARLA and this is thought to be partly due to people fearing a property crash and hence holding off buying. According to Knight Frank rental instructions are 15% down as canny BTL investors are leaving the market and investing elsewhere. It looks like the rush to exit the BTL market is building momentum, despite possible rental increases.

Posted by othello @ 03:23 PM (607 views)
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4 thoughts on “Fears grow that further interest rate rises will trigger a propertry crash

  • C'mon Correction says:

    We’ve just moved and renting in a nicer place, much closer to where my girlfriend and I work. After talking to the estate agents managing our new tenancy agreement, this report mirrors exactly what they are experiencing. Rentals picking up slowly and sales absolutely dead.

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  • tyrellcorporation says:

    Isn’t rent measured in the basket of goods? If it is then rising rents could actually lead to an increase in IRs – a cyclical arrangement!!!

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  • Still-waiting says:

    I am one of those who has chosen to rent rather than buy. I too live in a nice house in a lovely area. But I am the exception – everyone else I know has bought/is buying/wants to buy a house, even if it means huge debt. I reckon things may be about to change, though.

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  • Whether rentals are increasing or not (and ours hasn’t for the past 3 years), we’ll soon be sitting in a 3-bed, 3-reception (+conservatory) detached country house, looking at the ‘greater fools’ with an interest only mortgage on a 2up-2down terrace in the rougher local towns who will be paying more than us. If people actually had the intelligence to sit down and do the sums, they might see the folly of their ways. That said – it’s only the cheaper end of the market that are moving at the moment.

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