For those of you who think times are more than a little tough at the moment, the news that there are still major fears about the strength of the European Banking System, is not really what you will want to hear.
However, this week sees the release of a major report involving the “stress-testing” on a range of European Banks to determine their health and, perhaps more importantly, whether they are in a position to cope if anything goes seriously wrong again. These “detailed” tests have been undertaken on 91 banks, including names such as Deutsche Bank and Commerzbank in Germany, HSBC and Barclays in the UK, as well as Societe Generale and BNP Paribas in France.
Also posted in Coreco, Credit Crunch, Economic Recovery, Interest Rates, Mortgage Market, The Economy | Tagged Bank of England, Credit Crunch, Economy, House Prices, London Mortgage Broker, Mortgage Market, mortgage products |
There has been alot of press recently about the fact tracker rate products are more “popular” than fixed rates and whilst this is undoubtedly the case, could this be a big problem in the making?
It is of course no surprise that in recent times the popularity of the fixed rate product has waned as people come to terms with the financial environment. The “as cheap as possible please” line has been even more popular than usual as not only have many clients expected that Bank Base will stay low, but also that low tracker rates now are a shot in the arm to many, helping to keep the wolf from the door.
Today’s inflation figures, rising dramatically to 2.9%, could well bring to an end the ‘rate complacency’ we have seen among borrowers over the past year or so.
Whilst there are suggestions that this spike in inflation has been expected and is merely temporary, it is unlikely to drop off sharply if recovery does continue to grow and will undoubtedly put pressure on the Bank of England to seriously consider finally raising interest rates.
This is a real shot across the bows for borrowers, many of whom are quietly banking on a low interest rate environment in the short term. But this is a risky game to play.
Andrew Montlake, Communications Director at Coreco and ‘Mortgage Personality of the Year 2008’, gives his views — honest and no holds barred — on the latest developments within the mortgage and property markets.
