British mortgage has unexpectedly became inaccessible (Part 3)
28 February 2008In Britain real estate boom in 2005 began just from decrease in the key rate by 0,25 %, however now, in analysts’ opinion, such scenario can’t happen.
Other experts, contrary to Halifax’s forecasts, do not exclude the further cut in prices (at a level of 5-8 % this and next years) as many house owners will be forced to sell their property: according to KPMG, only one of four borrowers now can monthly pay the credit.
And, in opinion of the British experts, present cut in prices will not be enough to revive the market. Though real estate becomes more accessible, bank offers are less accessible; so many beginners in the market should postpone the first purchase for months, and maybe, for years. Combination of previous rise in prices and present toughening of credits’ conditions has unexpectedly made the mortgage inaccessible.
Analytics now name three major risk factors, which can lead to the default of house owners: long terms of the credit, a high ratio between the loan and cost of the habitation, and also too high ratio between the sum of the loan and the income.
- British mortgage has unexpectedly became inaccessible (Part 1)
- British mortgage has unexpectedly became inaccessible (Part 2)
- Morgan Stanley will close the British mortgage unit
- Mortgage crisis in the USA knocks Russia (Part 2)
