Posted by UK house price crash: Homeowners warned values could plunge by up to 40% in huge blow
Millions of people could be hit by a massive hammer blow as the UK Government comes under huge economic pressure.
By Paul Withers
18:26, Mon, Sep 26, 2022 | UPDATED: 18:44, Mon, Sep 26, 2022
Martin Lewis gives advice on rising interest rates
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UK house prices could crash in the UK by as much as 40 percent over the next couple of years in a hammerblow to millions of homeowners, an expert has warned. Shockwaves left financial and currency markets trembling this morning when the pound plunged to an all-time low against the US dollar. Pound sterling nosedived to just $1.0327 – below even the 1985 baseline of $1.0545 – before rallying slightly as the day progressed to close just below $1.07.
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The British currency has been on a downward spiral since midday on Friday following Kwasi Kwarteng’s so-called mini-budget where he announced the biggest tax cuts in the past 50 years.
Over the weekend, the Chancellor said more tax cuts could be on the way.
But homeowners could be dealt a huge blow after being warned that unless the Government is able to gain control of the situation, the UK could be heading for a massive house price crash.
Graham Cox, director of Bristol-based Self Employed Mortgage Hub, warned that 1.8 million borrowers exiting fixed-rate deals next year “simply won’t be able to afford the mortgage payments”.
UK house price crash: Homeowners have been warned values could plunge over the next couple of years (Image: GETTY)
UK house price crash: Homeowners could be dealt a huge blow (Image: GETTY)
He warned: “Unless the Government steadies the ship, we’re heading for a house price crash of 20 to 40 percent over the next couple of years.
“There are 1.8 million borrowers coming off fixed-rate deals next year. They simply won’t be able to afford the mortgage payments, forcing them to sell or be repossessed.”
If the pound does not start to recover, the Bank of England will likely make an emergency intervention and massively hike interest rates again – which had already been increased last week from 1.75 percent to 2.25 percent.
But in a massive blow to millions of Britons, this could impact mortgages in what would be a devastating blow for millions of homeowners already feeling the pinch.
READ MORE: Homeowner mortgage misery ahead as BoE urged to act – 3.75% predicted
UK house price crash: The market is in the spotlight as interest rates rise (Image: GETTY)
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