STUARTWHITEON…

The Herald Business - - Century 21 -

The cur­rent mar­ket

“The num­ber of trans­ac­tions will con­tinue to be strong for the fore­see­able fu­ture but peo­ple will have dif­fer­ent sell­ing mo­tives. Peo­ple were sell­ing for profit be­cause the prices were go­ing up and peo­ple were buy­ing prop­er­ties they couldn’t af­ford be­cause they were get­ting spe­cial mort­gage deals. But with in­creas­ing mort­gage rates, the num­bers of peo­ple buy­ing prop­er­ties they can’t af­ford has dropped slightly. There has been a big jump in re­pos­ses­sions be­cause of vari­able mort­gage rates.”

Five times salary mort­gages

“To imag­ine you can bor­row five times your salary and pay it on the mort­gage needs very care­ful con­sid­er­a­tion. With rises in coun­cil tax and gas and elec­tric­ity, it is not the case you can bor­row more on the mort­gage be­cause the costs of run­ning a prop­erty have in­creased sig­nif­i­cantly across the board. Any­one look­ing at bor­row­ing that level should give it se­ri­ous con­sid­er­a­tion. Un­less there is a de­fined rea­son for do­ing it, I would cau­tion against it, and the banks need to ed­u­cate peo­ple bet­ter about their lev­els of com­mit­ment.”

Drop in buy­ers pay­ing over ask­ing price

“When peo­ple had static in­ter­est rates, a con­fi­dence fac­tor kicks in and you are al­most en­cour­aged to up your of­fer to get a prop­erty. But as in­ter­est rates are mov­ing, and no one knows where they are go­ing, peo­ple have to think more care­fully about whether they are over-com­mit­ting them­selves. I don’t think there is such a short­age of prop­er­ties around. If you look around Glas­gow and the west of Scot­land, there is a very ac­tive build­ing de­vel­op­ment mar­ket. And find­ing a unique prop­erty – such as river­side apart­ment in Glas­gow – is not as hard as it was.”

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