Omagh mortgage advisor moves to allay fears

DESPITE the latest interest hike by the Bank of England pushing borrowing to its most expensive rate since 2008, a local finance expert has moved to allay fears.

Sean Curran, who runs The Mortgage Man in Omagh, also remarked that the recent rise in interest rates from 4.5 per-cent to 5 per-cent, is unlikely to effect the local housing market.

Speaking to the Tyrone Herald, the Carrickmore man explained, “The worst thing at the moment is that people are panicking due to what the national press are saying but personally I can’t see this getting much worse.

“People are worried about rumours that the interest rates could rise to 12 or 15 per-cent but I personally can’t see that happening. At that rate housing would become completely unaffordable and no-one would be able to afford a house, so the whole market would just collapse.”

He added, “This increase isn’t the first time a housing market crisis has happened, as we saw in 2008. However it is a time when people need to tighten their belts and kill their plans for big purchases, until this all settles.”

The Bank of England announced on Thursday that interest rates would increase to 5 per-cent, in a move to tackle burgeoning inflation.

This hike will mean that people on a fixed-rate mortgage – many of whom started on a 2 per-cent rate – will receive a massive fiscal shock when it comes to remortgaging. The average rate for a two year fixed term has risen to 6.15 per-cent.

Mr Curran continued, “This rate hike will make getting and keeping a house more difficult and people will be building fewer houses due to less affordability. But six months can make a big difference.

“At the moment the local housing market hasn’t slowed as there is still a big void of houses that need filled and whilst the prices are up, the demand is still high.

“Realistically, people will have to bite the bullet and make sacrifices to keep their houses, such as cutting back on other purchasing… For home owners, keeping their property takes priority over any other spending.”

The local man also predicts that there could be a re-surge in co-ownership.

“Co-ownership has allowed many home-owners to survive in the past and I can see it is again becoming a trend like in 2008, where many were forced into co-ownership during the crash,” he said.