Going through the news the other day I found an almost throw away comment saying that the Bank of England are thinking of scrapping the Stress Test for owner occupiers taking out a mortgage.
The idea behind it is that mortgage lenders are meant to make sure borrowers can afford a 3% increase on their mortgage payments.
But the Bank of England now think that for the next few years at least interest rates AREN’T going to go up by 3%. Makes sense.
Some experts think the next interest rate move is into negative rates. We’ll see.
So that would make it easier for owner occupiers to get loans, and to buy properties. By the way, I don’t think the Stress Test for buy to let properties will be scrapped.
But getting rid of the Stress Test for owner occupiers could well have a positive affect on the property market and, by extension, property prices.
Is that a good thing or not? You decide. If the market is going to correct in 2021 (and with reduced GDP, increasing unemployment, Brexit etc you’d think it should) it may help limit any falls. Anyway, I tell you all about it in the video so please take a look.
Here’s to Successful Property Investing.
(ex) Chartered Surveyor, author and property investor
PS. By the way, I’ve rewritten and updated my best-selling e-book, The Successful Property Investor’s Strategy Workshop, which is an account of how I put together my multi-property portfolio, starting from scratch and with no money of my own, and how you can do the same.
For more details please go to: