Money News
Five rounds of base interest rate increases are taking their toll on the housing market, according to Moneyextra. Indeed, the average property value of £218,0331 in July was down by 4.65% on the month and up just 1.63% year-on-year. At the same time, the average mortgage being sought by first-time home buyers was £132,699; its lowest level since January 2006.
Robin Amlôt, Senior Editor of Moneyextra.com, said, "We're now seeing evidence that the rate rises we've already had are starting to have an impact. The reason it's taken so long for the housing market to reflect the higher cost of borrowing is the large number of people who were on fixed rate mortgages whose fixed rate periods are only now coming to an end.
"Turmoil in the stock market in recent weeks has reduced the likelihood of base interest rate rising in September as some commentators had predicted. That means we could be at the peak of the interest rate cycle now - the next move, when it comes, could be downwards, although that could be as much as a year away."
The average value of mortgages actually completed by AWD Moneyextra customers in July was £151,488.09, down from an all-time high set in May this year of £166,732.43. The most popular mortgage lender in July was Halifax.
21 August 2007 © Moneyextra.com
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