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Debate House Prices
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Interest rates will rise faster and higher than anyone expects
Poshbird
Posts: 222 Forumite
Interest rates will rise faster and higher than anyone expects
http://www.moneyweek.com/news-and-charts/economics/uk/interest-rates-will-rise-faster-and-higher-than-anyone-expects-12201
For now, the Bank of England is not going to do much about rising inflation in the UK. Wages over here aren't rising especially rapidly, and that's what the Bank is really worried about.
However, as star hedge fund manager Crispin Odey noted recently, this means that when rate rises do arrive, they'll be much more aggressive than anyone expects.
http://www.moneyweek.com/news-and-charts/economics/uk/interest-rates-will-rise-faster-and-higher-than-anyone-expects-12201
For now, the Bank of England is not going to do much about rising inflation in the UK. Wages over here aren't rising especially rapidly, and that's what the Bank is really worried about.
However, as star hedge fund manager Crispin Odey noted recently, this means that when rate rises do arrive, they'll be much more aggressive than anyone expects.
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Comments
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7% would be carnage, how could the average person who bought a house in recent years afford to keep paying their mortage?
And he is saying higher than 7% faster than anyone expects?
If he is right then the auction houses will be busy, we will be following the USA house price crash and theirs was before interest rates go back up.
Well I'm inclined to agree re your 'carnage' comment but would venture that those of us on fixed mortgage rates will somehow manage...
Moneyweek do have a propensity for the dramatic (and often incorrect), however at least with this it's caveated by the statement
"This will take some time to pan out of course – we're talking years rather than months"
As such, I'm not going to run to the bunker with my tinfoil hat in hand quite yet...Go round the green binbags. Turn right at the mouldy George Elliot, forward, forward, and turn left....at the dead badger0 -
Not a chance IMO. The economy (or what's left of it!) and house values are now hugely dependent on rates stating very low for a very long time. Moneyweek are comically bad when it comes to these predictions.Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0
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Well I'm inclined to agree re your 'carnage' comment but would venture that those of us on fixed mortgage rates will somehow manage...
Moneyweek do have a propensity for the dramatic (and often incorrect) however
Fixed rate deals will be great while they last, but what about at the end of the 5 yrs or whatever the term?
But yes it will be the course of wisdom to fix now if you havent yet.0 -
Seems to be about IR increases on the back of very high wage inflation.
Not sure how likely that is.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0 -
moneyweek lol0
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Funny how wild speculation becomes certainty of carnage within a handful of posts.
This from the OP who keeps banging on about investing in silver.Been away for a while.0 -
lol... those emails that clog up my junk folder!Plan
1) Get most competitive Lifetime Mortgage (Done)
2) Make healthy savings, spend wisely (Doing)
3) Ensure healthy pension fund - (Doing)
4) Ensure house is nice, suitable, safe, and located - (Done)
5) Keep everyone happy, healthy and entertained (Done, Doing, Going to do)0 -
The frock example is particularly poor (but this is Moneyweek so what do we expect).
A £180 dress costs that because it has huge retail margins, is sold in an expensive retail shop with plenty of marketing. It ain't going up to £240 because the price of Chinese Labour had gone up.
In addition, it is that type of garment that could be made somewhere else fairly easily, besides, no one "needs" a buy a £180 frock
The correct example is the £2 Tee shirt or £4 Jeans sold in Tesco / Primark etc, etc, or food as richer Chinese people eat more meat.
Not much fat in the value chain there.US housing: it's not a bubble - Moneyweek Dec 12, 20050 -
One issue that seems to get missed by many contributors to this forum is that UK PLC does not have the final say on interest rates.
If other economies start to push up intersest rates, the BOE will have to follow.0
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