House prices ''standing still''
Wed 31st Oct, 12:45:15 GMT
One leading financial portal is reporting that the mortgage market has hit an effective standstill, with the average value of completed mortgages remaining largely unchanged over the previous three months.
Robin Amlot, senior editor of Moneyextra.com, noted that five successive interest rates since last summer were beginning to take a toll, particularly among people who took out a mortgage in 2005 and are now struggling to meet less favourable rates while renewing their fixed deals.
"It''s becoming clear that the mortgage market peaked in May this year and was already on a down-trend before the summer credit crunch hit," Mr Amlot said. He added that a house price crash remained unlikely, but that the predicted rapid slow-down in activity "may feel like a crash to some".
Other economists have been less optimistic about the market, however, with Capital Economics today predicting that house prices will fall six per cent in 2008.
Earlier this month, the International Monetary Fund even went so far as to say that property prices are overvalued by as much 40 per cent and so face a sharp "price correction" in the coming months.
Robin Amlot, senior editor of Moneyextra.com, noted that five successive interest rates since last summer were beginning to take a toll, particularly among people who took out a mortgage in 2005 and are now struggling to meet less favourable rates while renewing their fixed deals.
"It''s becoming clear that the mortgage market peaked in May this year and was already on a down-trend before the summer credit crunch hit," Mr Amlot said. He added that a house price crash remained unlikely, but that the predicted rapid slow-down in activity "may feel like a crash to some".
Other economists have been less optimistic about the market, however, with Capital Economics today predicting that house prices will fall six per cent in 2008.
Earlier this month, the International Monetary Fund even went so far as to say that property prices are overvalued by as much 40 per cent and so face a sharp "price correction" in the coming months.
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