Mortgage and property market in 2008

There is growing concern coming from experts on how the mortgage and property market in 2008 will turn out.

Although not guaranteed house priced are likely to fall in early 2008 by at least 1-2% as first time buyers are unable to enter the market and second time movers are unable to sell their home. There was incredible housing inflation from early 2006 to mid 2007 of up to 100% in some areas such as the North of England and East Wales.

Thankfully, for long term stability, these unsustainable increases have come to an end, this will hopefully lessen the extent to which the UK's slowing economy will be effected in the long term.
Predictions are that house prices will fall flat over the next year with the possibility of another interest rate cut ensuring UK home owners don't face negative equity there are some positive signs that this market correction will ensure stable growth over the next 10 years.

The possible changes in the mortgage market are more people looking at remaining in their current properties for longer which should see an increase in long fixed rate mortgages, a product being purchased by the current government as a way to stabilise the mortgage market.
Long term mortgages are generally fixed for between 5 years to 25 years which could give added security to homeowners fearful of fluctuating interest rates and house prices. The obvious negative being as the products hints, you are fixed for that period. There are several 25 year products which will only penalise you for the first 5 to 10 years, which is still a considerable amount of time, with the other disadvantage being many independent mortgage brokers may see the recommendation of long term fixed rate mortgages as commercial suicide to the lose of custom many are used to.

If you are considering a long term fixed rate mortgage please remember to fully understand the consequences of tying yourself to one lender for such a period. They can be a good choice for some homeowners but without thinking all doom and gloom, what happens if you need to move for family, work or other social reasons?
Many will offer a porting facility, a feature which allows you to take the mortgage to the next home, however what if your new property in overseas or has a lower value?
For more information on long term mortgages you should seek an independent mortgage broker from my mortgage portal site.