North Wales Daily Post: Lower Mortgage Rates Tipped
Wed 07 Aug 2013
The housing market revival will be boosted further by confirmation that historic low interest rates are here to stay - but savers will pay the price by suffering years more misery - experts have said.
New Bank of England governor Mark Carney gave households and businesses a boost yesterday as he said interest rates will remain at their record low until unemployment falls below 7%.
Lower-for-longer interest rates could result in already ultra-low mortgage deals being made even more attractive, according to analysis.
But desparate savers were warned that they may need to consider taking on more risk if they want to make decent returns on their cash.
Peter Rollings, chief executive of estate agent Marsh & Parsons, said the indication that rates will stay at historic lows for at least another three years will give another "significant boost" to the housing market, which has already been gathering pace as a result of increased confidence in recent months following various Government schemes.
Lenders have been offering some of their lowest ever mortgage rates since the Government launched a scheme one year ago called Funding for Lending, which gives lenders access to cheap finance.
Jonathon Harris, director of mortgage broker Anderson Harris, said: "This is far more certainty than we have ever had and while it brings no comfort to savers, it will reassure overstretched borrowers who are worried about potential rate rises.
"We expect fixed-rate mortgages to fall even further on the back of this."