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If I was mortgaging/remortgaging now I think I'd be looking for a 5 year fixed, but generally over that period I can't see house prices being down by the end of the term and if you choose an area 'on the up' you would expect to still see a decent uplift. Unless we really are seeing the first stages of global economic collapse London property is pretty insulated.
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Does this sound wildly optimistic to anyone?
The whole attraction of primary residential property is that even if it goes down in value you can still live in it.
However, you have to be able to survive the "margin call" scenario, which is either reverting to SVR after 5 years (which could be 7%+) or have a low enough LTV that you could refinance even if the value goes down 10%+.
owl
NickCJ
@ReekBlefs
What's the group feeling on the way interest rates and the property markets are going to go?
I've just had my max mortgage extended for a place to live and I'm pondering getting myself mortgaged up to the hilt to get out of a fairly toxic living situation which I currently find myself in. It's really tempting but I'm wondering if my desperation to get out is clouding my judgement.
Personally while I imagine the market in London will slow a little, I can't see it contracting in any meaningful way, and by the time I move out of any new place in four or five years time, I imagine it will by then have re-corrected itself. And if interest rates jump at least I'll be at the start of a two or three year fixed term mortgage, and in a place where I'm happy to live and work for a few years.
Does this sound wildly optimistic to anyone?