It was time to dust off the crystal ball this weekend, as talk once again turned to future interest rates. Opinions varied as to the extent of any potential changes in rates and house prices, with some experts predicting a double dip over the next couple of years due in part to a lack of available mortgage credit. Others agreed that the market is certainly set to cool down but had a more positive outlook, suggesting that low interest rates will continue to support the market. Brokers in the Sunday Telegraph and the Mail on Sunday urged borrowers who are considering remortgaging to do so now, and also reported that long term fixed rates have become more popular among homeowners looking for stability in these uncertain economic times. For those borrowers looking for the best of both worlds, a new ‘Interest Rate Protector’capping product which protects against rising rates has been launched. Available on mortgages over £500,000, the cost of buying a cap varies with market conditions. Experts in the Financial Times and Sunday Times welcomed the innovative product but also felt the premium was high, and recommended that borrowers also consider a standard capped tracker mortgage or a 5 year fixed rate. Elsewhere the FT reported a surge in Buy-to-Let enquiries since the Chancellor confirmed that Capital Gains Tax will rise to a lower than expected 28%, while the Mail on Sunday gave tips to potential buyers who may be considering using an estate agents in-house services.
What the papers say- 3rd and 4th July 2010