Is it a good time to buy a house and fix the interest rate for as long as you can?

Crashy_Time

user1977 said:

I wouldn't base the timing of your house purchase around current interest rates.

Bear in mind the restrictions on what you can do during the fixed period without incurring penalties (e.g. you may in theory be entitled to "port" the mortgage product to another property, but that's always subject to your lender being in a position to give you a mortgage offer when that time comes).

Millions of people have though, hence the impending disaster if rates rise.

ccbrowning

Anecdotal, but I went for a 5 year fix. Don't plan on moving for longer than that and it was just a tiny bit more. Might save a tiny bit of money with a 2 year fixed, provided interest rates don't change at all and the available products have no extra fees.

newsgroupmonkey_

Crashy_Time said:

What the UK government wants doesn`t really stack up against global pressures though does it? It didn`t during the ERM crisis, it didn`t during the sub-prime crisis and it won`t in the next crisis, the drip drip of negative sentiment from the media affects ordinary people and their financial decisions as well......

https://www.express.co.uk/news/uk/1526969/evergrande-financial-crash-uk-housing-market-immediate-impact

Didn`t this paper always trumpet property as the greatest investment ever....what happened?

Probably a bad time to buy a house to answer the OP`s question.

Now you've got my interest.

Pray tell, when was the best time to buy a house?

You've been spewing this nonsense since 2003 when you sold your house to live in a bedsit, due to the impending crash that never happened.

fewcloudy

Mutton_Geoff said:

For 277 years 1694-1971 with currency linked to holdings of precious metals (eg the "gold standard") - average rate 4.38%

For 49 years 1971-2020 after all links to gold standard removed - average rate 9.48%

It is widely written that an interest rate of +/-5% is about right for the general economy. It was that for nearly 300 years. The last decade or two has been completely skewed by printing presses with no regard to who is paying for the £20 notes.

Interesting... but it's that "last decade or two" (and the next decade or two) that's important to the house buyer today, not what was happening in the seventeen hundreds...

Crashy_Time

fewcloudy said:

Mutton_Geoff said:

For 277 years 1694-1971 with currency linked to holdings of precious metals (eg the "gold standard") - average rate 4.38%

For 49 years 1971-2020 after all links to gold standard removed - average rate 9.48%

It is widely written that an interest rate of +/-5% is about right for the general economy. It was that for nearly 300 years. The last decade or two has been completely skewed by printing presses with no regard to who is paying for the £20 notes.

Interesting... but it's that "last decade or two" (and the next decade or two) that's important to the house buyer today, not what was happening in the seventeen hundreds...

Very true, LOL.

jimbog

ccbrowning said:

Anecdotal, but I went for a 5 year fix. Don't plan on moving for longer than that and it was just a tiny bit more. Might save a tiny bit of money with a 2 year fixed, provided interest rates don't change at all and the available products have no extra fees.

If I was in your position that would have been the one I would have gone for. A two year one seems a little too short  

Crashy_Time

If you think rates are going to go up, and you therefore should fix, why not just wait for the inevitable price drops that will follow mortgage rate rises?

Crashy_Time

https://www.mortgagestrategy.co.uk/news/weekly-rate-watch-two-year-fix-climbs-4-basis-points/

nicknameless

Crashy_Time said:

https://www.mortgagestrategy.co.uk/news/weekly-rate-watch-two-year-fix-climbs-4-basis-points/

Thanks for linking to the rate cuts for larger LTVs detailed in that piece.  Much appreciated.

RelievedSheff

We remortgaged 6 months ago and opted for the longer 5 year fixed rate. We have no plans to move and the difference in rate between the 2 year fix and the 5 year fix was negligible so for us it made more sense to opt for the longer fix.

A similar product with our lender (Halifax) is now a higher rate than the one we are currently on, so their rates at least do seem to be heading higher, which I can't say is a huge surprise. 

We are hoping that by the end of our 5 year fix in May 2026 that we will be under 50% LTV so will be eligible for the best rates available at the time. A bit of movement with house prices either way shouldn't really bother us either way.