Record low interest rates, soaring house prices and our love affair for property (we all understand a house, don’t we?) have led to the current proliferation of private, some might cruelly say amateur, landlords. But now interest rates are moving to more ‘normal’ levels, selling a house that you thought was OK for someone else to rent but you’d never want to live in, might not be so easy; and tightening standards mean that more than a lick of paint and a tidy-up of the garden is likely to be needed to keep the show on the road. The crunch point will come when fixed rates end and suddenly rents don’t cover the monthly payment, hence Lloyds CEO’s call for more competitive mortgage options. Which will be needed sooner rather than later, I fear.
“Halifax index shows UK house price drop accelerates”
So gentle subsidence, rather than a crumble to rubble seems to be the predicted pattern for house prices. There have been what seem, with the great gift of hindsight, inevitable ‘market corrections’ every few years (1989-92 and 2008-10).