The Bank of England has announced that UK interest rates will be held at the record low of 0.5 per cent for at least another month.
Along with the announcement that its bond buying economic stimulus programme, part of the quantitative easing, is being kept unchanged at £375 billion, the news has gone a little way to tempering homeowner fears of an impending interest rate rise that would have a significant effect on some consumers mortgage repayments.
However, with analysts observing a healing economy that is set to grow by as much as three per cent in 2014 – and so lead to a gradual lifting of the base rate next year - homeowners may now be counting down the months until their payments begin to accelerate if they are not on a fixed rate currently.
A new survey conducted by YouGov and commissioned by consumer body the Home Owner Alliance has found that a third of UK homeowners are currently concerned about rising interest rates.
However, this proportion rises dramatically when only younger demographics are taken into account, with half of all homeowners between the ages of 25 and 34 confessing to being worried about rate rises.
UK homebuyers have benefitted greatly from the Bank of England`s all time low base rate of 0.5 per cent, which has been in place since 2009 and helped to keep credit cheap and banks lending , as well as bringing down interest rates on many mortgages.
But despite being a boon to house buyers and the market alike, the new poll of more than 1,600 homeowners has also found that first time buyers are now relying heavily on low interest rates, as well as assistance from parents and / or the Help to Buy scheme to take their first step on the property ladder.
This is compounded by a severely constrained supply of homes and accelerating demand, which is forcing up house prices in almost every region of the UK and putting home ownership out of reach for many.
If you`re worried that your mortgage could prove unaffordable following a rise in interest rates, First Choice Finance can help. With access to a large range of mortgage products, we can find the most suitable deal from our panel so you might find a way to reduce your mortgage worries.
For a free, no obligation quote, head to firstchoicefinance.co.uk or give us a call on 0333 003 1505 or 0800 298 3000.
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