In recent months the Bank of England has been dropping hints that it be will raising interest rat...
In recent months the Bank of England has been dropping hints that it be will raising interest rates sometime in the not too distant future. Since the spring of 2009, UK interest rates have been at a record low of 0.5%. It’s not a case of if but when they will rise. Some people think it is long overdue but I am of the opinion that we shall see the first movement around Easter time and those rises will be slow, steady and limited.
Homeowners or landlords with a mortgage need to realise that as interest rates rise, their monthly mortgage costs rise. It’s easy to put these things off but I believe that if you delay much longer the best deals will disappear. If you are on the lenders standard variable rate or your current deal is due to finish in the next couple of months, now is the time to speak to an independent mortgage broker to get a juicy deal and limit your exposure to the inevitable rate rises. You didn’t buy your property for it to become a millstone around your neck. It’s all about mitigating your costs and maximising your income to make your buy to let property the investment you want it to be.
However, on the other side of the coin, two in three landlords who have bought property since 2007, have done so without a mortgage. A rise in interest rates might be a good thing. Let me give you some background first, then I’ll explain why. Bracknell and Wokingham landlords have seen their buy to let investments perform very well over the last few years with average values rising 49% in Bracknell and 23% in Wokingham. However, when rates do rise, whilst more expensive rates will ease the demand for borrowing, it may temper house price growth, making the property market more competitive…and therefore, we should see the return of some bargain property buys in Bracknell and Wokingham!
Belvoir Bracknell don’t sell property, we are lettings specialists, but we do guide people based on our experience as to what might make a good buy to let property investment in the Bracknell, Wokingham, Crowthorne and Binfield area. We don’t charge for this service but we would like to manage your property or help you find great tenants.