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Bank Of England make new predictions on Mortgages

03/04/2008

The Bank of England (BoE) predicts a greater reduction in mortgages in the next quarter of 2008, mortgages will become difficult to obtain due to current market conditions.

Due to mortgage criteria changing everyday, demand from homeowners and buyers for mortgages has sustained unchanged. Demand for buy-to-let mortgages rose. Investors feel that due to property prices being brought down, some feel it could be the best time to make a purchase.

Repossessions is set to increase over the next 3 months, increased prices and mortgage repayment increases leave homeowners under pressure.

Howard Archer at Global Insight commented: "Credit conditions heap pressure on the Bank of England to cut interest rates again next Thursday despite current elevated inflation concerns."

"It still looks a close call, but we expect the Bank of England to trim interest rates from 5.25 per cent to five per cent.


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