There will be “turmoil” in the UK mortgage market “for quite some time” as the conflict in the Middle East continues to unfold, according to guests on this week’s FT Adviser podcast.
The podcast examined the mortgage market in the wake of the continuing conflict in the Middle East and the subsequent surge in mortgage rates that has occurred through the UK.
“Fixed rates are about 1 per cent higher now than they were before the crisis,” John Charcol mortgage broker, Raymond Bulger, detailed.
“The big question people need to think about is where interest rates are going in the rest of the year.”
Barnsdale Financial Management mortgage broker, Scott Taylor-Barr, warned this level of disruption may not be alleviated anytime soon due to the nature of the conflict.
He explained there has been a lot of damage to infrastructure in the Middle East which will take a long time to fix.
“Even if the Strait of Hormuz was opened tomorrow and ships started flowing, the ability to start pumping oil out has been fundamentally damaged,” he stated.
Therefore, Taylor-Barr suggested the market was going to see turmoil for quite some time.
“Once we get a relative amount of stability we might see some small reductions in interest rates at a future date but I think we’re a long way off from interest rates starting with a 3 again,” he predicted.
Additionally, in a separate part of the podcast, Taylor-Barr discussed how the impact of the Iran War has reduced buyer inquiries, pointing out that buyers who are not in a desperate need to move are holding back.
tom.dunstan@ft.com