Why 2012 is a good year to buy
The eurozone crisis is set to continue well into 2012. Unfortunately, until all the structural changes to the eurozone become clear and – more importantly – a binding agreement is reached, there is likely to be little stability in the financial markets, thus delaying the recovery of the UK economy.
As well as affecting economic activity, perhaps leading to a ‘double-dip’ recession, the uncertainty over the eurozone will also continue to affect the cost of money lent between financial institutions, as measured by LIBOR – the London Interbank Offered Rate – which stood at 1.08% at the close of business for 2011 (source: eMoneyfacts).
However, there are several reasons to be cautiously optimistic about the UK economy in general – and the UK property market in particular – in 2012:
- The UK economy is in better shape than most of its European neighbours.
- For many people, the cost of borrowing money to purchase a home is still at historically low levels.
- There’s no need to put off purchasing property because of rate uncertainty. For peace of mind, 5 year fixed rates are very competitive because of the fall in swap rates, some dipping below 3.5% for clients with a deposit of around 25% of the purchase price. (See the Best Buys panel to the right).
- There is unlikely to be price deflation in the prestige property sector.
- Clients should not be deterred by general rising unemployment levels and should simply consider their own security of income in 2012.
Call Private Finance for good, independent advice on mortgages and finance:
Telephone: 0800 980 8777
Posted on the 30th January, 2012
