A leading lender has said the UK mortgage market won't recover till 2010 – in the meantime, more people are turning to renting and rent back solutions.
It's not a great time to have a big mortgage. In fact, the bigger your mortgage, the bigger the likelihood that you're in negative equity. Rent back schemes and renting in general is facing a resurgence across the UK as more homeowners turn their backs on expensive mortgages and plummeting property prices. In fact, broadsheet newspapers have already done in-depth features into the fact that renting now makes more financial sense. There are claims that the balance of power has now shifted to tenants as more people wake up to the fact that renting is the best way to ride out the credit crisis. And rent back schemes could be popular until the housing market picks up and the economy stabilises.
Rent Back – Ride out the Credit Crisis
As the UK mortgage market is expected to shrink by 80% in 2008 and continue to struggle until 2010, with house prices falling further (according to leading lender, Nationwide) rent back schemes could become more popular. In fact, rent back schemes may offer a sense of stability to those who otherwise would have to face repossession or a drastic change in lifestyle in order to accommodate their struggling finances. Rent back schemes allows the property seller to stay in their family home as a legal tenant, offering a sense of continuation, stability and comfort in difficult and unstable times.
Rent Back as Redundancy and Repossession Fears Increase
Nationwide's group development director told the press that they expected the mortgage market – worth ?90bn last year – to be worth just ?18bn this year. Nationwide also said they expect property prices that have already seen ?30,000 wiped off their value, to continue to drop well into 2009. It's no wonder panicked homeowners are considering jumping off the property ladder and opting for a rent back scheme.
Repossessions have doubled in the past six months, compared to the same period last year. And there are fears the recession will impact heavily on employment and redundancies, forcing more homeowners into repossession or sell house fast, rent back schemes.
Economists have predicted rising unemployment. And combined with the economic downturn and a strangled housing market, this will inevitably result in a marked rise in the number of forced house sales, rent back schemes, and repossessions.
Looking for a Sell House, Rent Back Scheme? Speak to Property Rescue
If you need help to get a sell rent back scheme for your property, contact us at Property Rescue. We’re committed to helping you, whatever your circumstances. Property Rescue has helped hundreds of homeowners, rescuing them from desperate situations. With Property Rescue you can rent back with confidence.
Call freephone 0800 1313 999 for help today.
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