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Wednesday, January 20, 2016

Interest rates on hold

For landlords who were starting to sweat a little bit about the prospect of interest rates and their loan costs go up in 2016.  A little bit of good news coming from the turbulence in the commodity and global stockmarkets.  Mark Carney the Governor of the Bank of England has gone on record as saying there is no need for rates rises just yet.

When will interest rates rise?

Money market are now not predicting a rate rise until 2017.  This is good news for landlords like me who still have a number of variable rate buy-to-let mortgages.  I'm still choosing to remortgage one of my variable rate mortgages to a fixed rate mortgage and I'm still happy with this stategy of moving my loans towards long-term fixed rates to balance the risk in my portfolio against a sudden change in interest rates.  However, clearly we still live in extraordinary economic times which makes forecasting very difficult, so my advice to landlords is to spread their risk and expect and continue to plan for the unexpected.

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