Hello sqftmag,

Re prices & Interest rate cuts/property slump

Two large lenders have passed this reduction on to the borrowers who are on their SVR. The reality is that most customers are not on lenders SVR but various derivations & plans. So a reduction in the SVR is a headline to make us feel better about ourselves. Even on th SVR you will note that the margin is 2% over. Thats a big margin. Mortgage approval/booking/reservation etc fees have doubled in the last 6 months.

A large sector of the market is now with nonstatus/subprime lenders who use LIBOR as the base, which is currently 6.6% plus a loading. The reality of the rate change is minimal, and being used for headline publicity only.

So until margins reduce to previous levels and rates reduce again and fees and charges are halted and reduced, it will always be a cosmetic exercise.

Smoke and mirrors is a good description.

£100K mortgage saving £15-20 per month.

The action of 0.25% cut is a better headline than the reality of £15-20 saving.


Property will (in my view) remain generally stable with local variations and afte further cuts in Feb/April a strengthening will happen and maybe even a minor rise towards the end of the year.

There is no real need to panic, what good will panic do.

If youre in a house with a value of 200,000 that falls in value to 150,000 with a mortgage, panic will not help you one bit.

Best just tighten the braces and buckle up for the timebeing.

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Straight talking No Gimmicks www.newhomecyprus.co.uk

Hi,
I don't think a quarter of a percent is mcuh to write home about however it is a step in the right direction.

I think the market will level out next year. Some areas will go up, some will continue to go down. I saw an estate agent last week who said a family near me was desperate to move and had dropped their price from £235,000 to £215,000 and they were still receiving little interest. My friend sold a house for £235,000 in the same street 18 months earlier.

In the most pessimistic scenario, I think an average fall of 30% over the next 3 years is very much possible.

I have recently in the last couple of weeks seen reposession rearing its ugly head lets hope it doesn't start effecting a lot of people like last time.

Yes, what you siad about the US market is true. There is an deop in prices as well. This has an impact on the global markets as well as the UK property market. It's already effected, prices has deopped by more then 10% in the Uk property market till now. It is expected to drop more in the new year.

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Barbican Property | Property Bloomsbury | Property Limehouse | Estate Agents Clerkenwell