Half of property owners not ready for interest rate rise

By Natasha Adamson

Over half of property owners in Northern Ireland and the rest of the UK are not ready for an interest rate increase, and would struggle to meet their monthly mortgage payments, according to a Government advice body.

The average monthly mortgage payment would increase by £150 if interest rates were to go up by 2 per cent, and the Money Advice Service says 56 per cent of home owners would be unable to afford the increase. Spokesman Nick Hill says many mortgage borrowers would be "caught off guard" by an increase in interest rates as they have only ever experienced the "historically low" current rate of 0.5 per cent. The survey also revealed that a significant number of property owners did not know the rate they were paying under their current mortgage deal, or how their monthly mortgage payments would be affected by an increase.

While Governor of the Bank of England Mark Carney has said that an interest rate increase could happen soon, he has repeatedly assured that the changes would be modest and implemented over a period of time. Even if an initial interest rate increase is applied early next year, it is likely to be some time before it reaches as high as 2.5 per cent.

If you are buying a house in Northern Ireland, or selling or remortgaging an existing property, contact a member of the conveyancing team at Wilson Nesbitt solicitors in Belfast or Bangor by calling 0800 840 9290.

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