Homeowners are being forced to cut costs to curb rising mortgage rates.
Mortgage rates rose sharply in the market turmoil following the mini-budget, with many products removed from sale.
Interest rates offered on mortgages have generally increased in recent months following a series of moves. bank of england Base rate hike.
Joanna Elson, CEO of Money Advice Trust, told the Finance Committee that people’s homes tend to be the “last thing to let go.”
“Rates aren’t everything, rates and standards, especially stress test rates, have changed as a result of increased rates.”
Rents and rental home investors could be hit hard by higher mortgage rates, which could severely impact the availability of rental homes.
Chris Rhodes, Chief Financial Officer, Nationwide Building Society, said:
“And that knock-on effect, combined with more onerous tax and other regulatory requirements and higher mortgage rates, coupled with some existing landlords selling off, is really serious about the availability of rental properties going forward. I think it’s going to have a big impact, in the next year or two.”
Homeowners prepare to see the biggest rate hike since Black Wednesday as the Bank of England prepares to step in to accelerate to deal with double-digit inflation.
“I think the rental market is likely to be much more stressful than the housing market,” said Ray Bolger, senior mortgage technical manager at broker John Chalco. This affects renters as the shortage of supply drives up rents for those looking for tenants.
Charles Roe, Director of Mortgages at industry group UK Finance, said: But lenders were also dealing with numerous calls and requests from borrowers worried about whether they could refinance their mortgages.
See: How does inflation affect interest rates?