We went to the bank recently and they wanted to lend us loads for a new mortgage as we don’t owe anything and have been overpaying ours for years. We could get a mortgage now for a £250k house but are sticking at £160k as it will still enable us to have surplus to save or if rates go up.
Peoples eyes have been far larger than their wallets for some time now…
Thing is, in the SE you wouldn’t get a home for £160k, £250k would get you a flat in a nice-ish area.
To an extent our (as in my, although the country as a whole would probably be similar) financial security now rests on house prices being, at worst, stable. And we’ve had to gamble on prices rising at a rate that pushes down our loan to value rate to get us better rates quicker than the rates rise. Our saving grace is the new house needs a bit of (hopefully cosmetic) work so regardless of the market it’s value should rise before mortgage renewal time. It’ll be the only move we make for a very long time I reckon so as long as we can get mortgages at good rate’s we’ll be fine.
