What will the mortgage rate be this time next year?

treliac

wymondham wrote: »

I think pressure from the Govt will keep rates low - probably only around 1% max. Any higher and it would be suicide for them given how many people will be tipped over the edge by minute rises....

Either way, how much bearing will base rates have on what lenders charge?

nearlynew

wymondham wrote: »

I think pressure from the Govt will keep rates low - probably only around 1% max. Any higher and it would be suicide for them given how many people will be tipped over the edge by minute rises....

What?

You think the "government" is in control?

globalds

I would like it to stay low for another 12 months at least ...But I think that would mean things are not getting better. So maybe that would put my job at risk ...

I would guess between 1 and 2 % in 12 months.

AD9898_2

nearlynew wrote: »

Trying to predict the actions of liars and thieves is practically impossible.

Agree with this, however I predict rates to be around this level for several years. There are hundreds of thousands of zombie households, grinding themselves into the dirt, struggling to pay massive mortgages and unsecured debt.

You can see what kind of state the country is in, put base rate upto 5% tomorrow (still historically low), and the government would have to deploy the army along with marshall law and night time curfews to keep law and order.

With low rates they can keep the plates spinning, so no change within any foreseeable future.

Loughton_Monkey

When things move, they move. I predict BR 0.5% until February/March. Then I see them going up, and if they go up 0.25% a month (plus the odd 0.5%) then we could see around 2.5% by next November. I expect the banks to plead poverty, with so many loans linked into BR, that they will increase new mortgages by about 3% or more.

Personally, I am looking for a bit of movement on the savings side! So maybe wishful thinking.

[Deleted User]

I`d go for 1.25% by dec 2011,inflation wont be tamed,especially with the 2.5% hit from the vat increase looming,the only tool left in the box to curb inflation are interest rates,it was ever thuse with the tories

lpp1980

No change till the middle of next year. After that, just small increases. Likely to be around 2-3% by 2015. The economy couldn't stomach a big increase. Too many people too near to the edge, rightly or wrongly.

stringsmk2

treliac wrote: »

Either way, how much bearing will base rates have on what lenders charge?

I realise that it is different here in NZ, but due to low lending and turnover, the banks here are relaxing the amount of deposit you need to stimulate demand.

treliac

stringsmk2 wrote: »

I realise that it is different here in NZ, but due to low lending and turnover, the banks here are relaxing the amount of deposit you need to stimulate demand.

That's great if there is enough good solid demand. Over here I don't think there is.

Generali

I hope you're wrong about base rates. If they stay low it's because the UK's economy is still FUBAR'd.

'Normal' base rate are about RPI+2% as a rule of thumb if the economy is going to be 'normal'. Eg, if RPI is 3% you'd expect base rates to be about 5%.