Homeowners - prepare to pay £1000 more a year

20 June 2014

home sweet f-ing home Looking forward to interest rate rises? No? Well, you’ll want to bury your head in the nearest bucket of gin when you hear that - potentially - homeowners might have to pay more than £1000 more a year than they do now.

That’s according to a report by estate agents Savills, who calculated that if the base rate went up from 0.5% to 1.5%, that means cash strapped homeowners on an interest only mortgage will have to find an average of £1,312 for the pot.

And if you’ve got a capital repayment loan, you will have to magic an extra £872 from the back of the sofa.

Interest rates might go up by the end of the year, although the Bank of England has promised that the rise will be ‘gradual.’ But if it does go up by 1%, or even to 2%, it will push affordability to the limit and your mortgage alone will constitute over 20% of your earnings. That was the exact situation in 2007, before THE CRASH.

So when will interest rates rise? When do we have to prepare our nooses? Only Mark Carney knows. But for homeowners, it is written in the wind - Winter Is Coming. Better start your dodgy webcam business now and earn some £££s from home.

TOPICS:   Banking   Home   Mortgages   Economy


  • Mark H.
    Or just get a fixed mortgage deal...
  • weenie
    Someone in London may end up paying £1000 more but people in the rest of the country (yes, there are actually people outside of London, really!) will pay less. Media scaremongering as usual.
  • bob
    Can't wait! Might make houses more affordable again. (Oh and if you thought that 2007/8 was "THE CRASH", then you ain't seen nothing yet!) :)
  • Mr M.
    It's still cheaper to have a mortgage than renting the equivalent house, and rents will just go up to cover all the BTL mortgages that have ruined the housing market for young people.

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