Considering pulling out of purchase (rate rises)

london21

5 years would have just given you a bit of certainty to know what your mortgage payments would be for the next 5 years.

But then who knows maybe in the next 2-3 years interest rates might start to reduce. 

Depends on your individual circumstances but the stamp duty cut not sure prices will go down and rents will increase due to increase in mortgage for landlords which will get passed down to tenants. 

housebuyer143

Gavin83 said:

Deleted_User said:

@Gavin83 Agree with what you are saying about house prices rising, but may I ask why you wouldn't have gone with a 5 year fix at 3.5%? I am about to apply to something similar so curious about why I maybe shouldn't!

I suspect interest rates will peak next year and then start to reduce so in 2 years time I suspect they'll be lower than they are now. However this is a complete guess on my part and no one knows where rates will be so it's for others to make their own decision.

Unfortunately my fixed term rate ends next year (terrible timing!) but I'll certainly be fixing for 2 years when I need to renew. I'd fix for a year if I could but I'm not sure that's an option.

The mortgage works were doing 1 year rates the last time I looked. 

Flugelhorn

it can be tricky when things start to go up - we didn't bat an eyelid at 12.5% though remember being slightly envious of someone who had 10% fixed for a few years. Honestly if you let house prices "escape" then you will end up with a much bigger mortgage anyway 

jj_43

No, you are not over worrying. But it is all in the numbers, do you have the income and is it affordable?

Are you concerned about affordability or losing your job, in which case yes reconsider, or is it that you may have to spend most of your income on mortgage costs, in which case you would need to re-budget, and accept those choices.

However the risk with renting is that house prices continue to increase and your next house becomes unaffordable for you.

Cheesy77

Thanks all for your responses, very helpful discussion.

I am going to mull it over for a few days, but I do think I'm overreacting. Probably not helped by a day of doom and gloom about the UK economy splashed all over the news. 

As some have said, who knows what the future will bring, but hopefully some better times for all

Zerforax

The budget looks like it will make inflation run hotter in the short term and then plunge us into recession so rates will probably start coming down eventually to try and stimulate demand in the economy.

housebuyer143

Zerforax said:

The budget looks like it will make inflation run hotter in the short term and then plunge us into recession so rates will probably start coming down eventually to try and stimulate demand in the economy.

😆😆😆 To laugh or cry at this....

Sarah1Mitty2

housebuyer143 said:

Zerforax said:

The budget looks like it will make inflation run hotter in the short term and then plunge us into recession so rates will probably start coming down eventually to try and stimulate demand in the economy.

😆😆😆 To laugh or cry at this....

Why? It is basically what the so called experts in the media are saying.

Murphybear

You talk about “moving into rented” but should be aware that decent rentals with affordable rents are getting harder and harder to find.  It could take you a long time to find somewhere suitable.  

housebuyer143

Sarah1Mitty2 said:

housebuyer143 said:

Zerforax said:

The budget looks like it will make inflation run hotter in the short term and then plunge us into recession so rates will probably start coming down eventually to try and stimulate demand in the economy.

😆😆😆 To laugh or cry at this....

Why? It is basically what the so called experts in the media are saying.

Because the country is basically screwed.