I’m writing this at the start of the year. I usually look back at the exciting things that have been happening, but this last year has been on a whole new level. In a world that seemed almost on fire the UK saw two Monarchs, a selection of Prime Ministers, a record-breaking shortest-serving minister, record-breaking summer heat, a big freeze, rising Interest rates and price caps on heating being lifted.
Simultaneously, the mortgage industry had staff shortages, company mergers, limited ‘affordable’ stock, supply chain problems for developers and builders, sterling fell (in response to one short-lived Chancellor and Prime Ministers’ decisions), the qualifying challenges for borrowers increased and house prices started to fall as surveyors became nervous and lenders tightened the reins.
The chaotic financial market had started to settle before the end of the year, with some fixed rates falling below the peak of the problematic time. Expectations are that inflation will gradually fall after reaching a high of 10.7%, the highest for over 40 years. The `Should-I-Fix-Or-Track’ dilemma will continue, and more than ever, borrowers need to review their situation when considering between fixed and standard variable or discount rates.
For anyone wanting to buy a property or business, this year may be a good time as prices are likely to increase again the next year. Buying power comes in different shapes and sizes and this is looking more than likely to be the year of compromise.