Well a fairly eventful week on a number of fronts, not least that of Ms Mordaunt, our new international development secretary (I now await my admiration of her.. appointment in the cabinet reshuffle to be met with hysterics by the sisterhood). Priti is out having come over all Tony-I-can-fix-the-problems-of-the-world-in-my-next-available-diary-slot/holiday-for a price-Blair, there doesn’t appear to be anyone in those renowned bastions of chasteness -Hollywood and Westminster-who isn’t preying upon or being preyed upon and some of the hierarchy of Welsh Labour have taken self-governance to a whole new level by ditching any notional adherence to the Ministerial Code. Hey ho. The one thing that seems to have slipped under the radar,clearly not being ‘ sexy’ enough (no pun intended), is that the BOE has raised interest rates from 0.25% to 0.5%. Regular followers of the original NP property blog will confirm that over the past 6 years (6 years? When I still had hair-ish and before each edition of Strictly Come Prancing lasted as long as a Wagnerian opera with those b%^&dy gimmicky videos of the dancers and and their celebrity partners hamming it up), we have questioned the validity and expertise of many City experts who year on have predicted that rates would rise “next year”; until the end of 2016 when most of the said pundits were adamant that rates would stay the same “well into 2018”. Ah well boys and girls, it was 50:50.
So what does this actually mean for the property market and the naysayers and prophesiers of doom? Well keep at it lads because there is still an acute shortage of houses for sale and prices are holding up simply because of a lack or property choice. Some of us still in the business are old enough to remember when interest rates went up 6% in one day. The world continued to turn on its axis, but repossessions soared and here we are today with repossessions at their lowest level. A point that few have have grasped (either through willfulness or ignorance) is that interest rates can and do, go up. 70% of all mortgage holders in this country are still on a fixed rate and are insulated against any rise-for now. Post the 2007 financial apocalypse, the stress testing introduced for all mortgage applications was introduced for the very reason of interest rates rising and applicants monthly financial commitments increasing. What never changes is that the right house at the right price in the right location will still sell. Many buyers are still of the mind-set that they will do whatever is required to get the house of their dreams and sod what happens next. Personal choice and we are a free country. As I type this I am listening to the Service of Remembrance, remembering those who made the ultimate sacrifice to allow us to live in a country where we can write blogs about interest rates, Cabinet Ministers’ bosoms and Saturday night light entertainment. Without being overly maudlin and introspective, it rather puts everything into perspective doesn’t it?