This article was written by Kelvin Francis from Kelvin Francis Estate Agents– our exclusive estate agents in Cardiff. Keep reading to read the answer to the question, “Where are we now with mortgage rates?”
Since the announcement of the ‘mini budget’, and the disruption that has occurred in the financial markets, you are probably wondering about the position with mortgages?
Inflation was coming about already for external reasons, the debt incurred during the pandemic and the Ukraine war, as well as problems over the supply of fuel, in particular gas.
Unfortunately, it is reckoned that a couple of points were added to inflation as a result of the fiscal uncertainty brought about by the mini-budget, but more importantly, the unsettling of the financial markets.
This will calm down in due course and although mortgage lenders have had to withdraw several offers, because they were predicated on lower rates of interest, they will be producing new offers shortly.
If you are still under a fixed rate contract you will not yet feel a difference, but if you are looking for a new mortgage or renewing terms, rates are going to be somewhat higher.
Many people these days have chosen fixed rate terms, from 2-5 years and these now can be at over 6%. However, if interest rates do come down again, and a reversal of policy could have an effect, you would see the benefit sooner in a variable rate mortgage. The advice is to go to a good Mortgage Broker and a reputable Estate Agents can direct you to one.
The recommendation therefore is not to panic. Remember property will always be an excellent investment and don’t be taken in by the ‘doom mongers’, who ‘predict’ a crash in prices. Property is very much in short supply and will remain so for some years to come, so demand will continue to exceed supply.
Kelvin Francis was born in Birmingham, but brought up in Cardiff. He attended Cardiff High School and then qualified as a Chartered Surveyor. He worked in Wrexham with the District Valuer (part of the Inland Revenue) and subsequently moved into Estate Agency, working in Abingdon, Cheltenham and Cardiff. In 1978 he opened his own office in Cyncoed, Cardiff and has been in that practice for 44 years. He has two daughters and three grandchildren. He is actively involved in the business and believes in both modern technology for improved efficiency, but passionately believes in the importance of personal service and to achieve this, to work with highest quality of colleagues.