Bigger mortgage debts ‘no deterrent’

Brits are still keen to invest in property despite the potential for debt management difficulties in light of recent interest rate rises and the likely prospect of a further increase in the cost of borrowing this month, figures from Property for Life suggest.

Research by the organisation claims that a full 71 per cent of Brits consider property to be a sound investment and that 93 per cent expect to see the base rate of interest rise above 5.25 per cent.

“Interest rates have risen steadily since mid-2005, but despite further predicted rises, the residential housing market shows no sign of contracting,” said David Austin, Property for Life managing director.

“The average house price in April 2007 was around £180,300 up from £162,000 a year ago, and this survey shows that the general public still believe that there is room for further growth.”

It was suggested recently by Karl Elliott from Engage Mutual that young adult consumers in the UK have become “accustomed” to having personal loan and credit card debt.