Housing Market.
Experts at Halifax have maintained that the UK housing market remains tight in a climate of rising prices and relatively strong demand, but mounting affordability pressures could impact upon demand in the future.
New research from the bank has indicated that prices are continuing to rise throughout the UK, with no town having an average property price below £100,000. The national average is fast approaching £200,000, indicative of a buoyant property market in the UK at large.
During the first quarter of 2007, house prices increased by 2.8 per cent, according to the report.
Speaking in light of these findings Halifax chief economist Martin Ellis stressed that rising interest rates, house price inflation and generally high living costs will combine to have a dampening effect on housing market activity.
"House prices continue to rise in a tight market but there are emerging signs that pressure on householders' finances, partly due to the rise in interest rates since last August, is dampening housing demand," he commented.
In areas that have seen the biggest house price rises, commentators highlight demand from buy-to-let investors as one of the key factors, as property letting trends help boost the property sector as a whole.
This has been seen in a number of regions in Northern Ireland, in which the top ten towns for house price inflation during the past year are located.
Landlord Mortgages “Rising interest rates will effect the landlords ability to service his/her Buy To Let Mortgage or Buy To Let Mortgages. Rental income is highly likely to rise this year but in the meantime the landlord may have to dig into his or her pockets in order to meet the mortgage payments. Rightly or wrongly we are expecting more landlords to carry out Buy To Let Remortgages in order to pullout equity to service the debt.”
Lettingagent.com “Tenants are fighting hard for the relatively small number of new properties coming onto the rental market, this is likely to result in higher rents achieved for Buy To Let landlords.”
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