Thursday, May 22, 2014

Keeping a roof over ones head

Following on to the previous post of housing debt in America, British figures and forecasts fair little better.

4,000 households in England are at risk of eviction or repossession every week due to high housing costs and a shortage of affordable homes. The housing charity, Shelter, released a study based on Ministry of Justice data on homeowners and private or social renters receiving a possession notice for their home, showing an estimated 215,000 homes in England are at risk of losing their homes.

"People are hearing that the economy is recovering, but we're seeing the reality that many families across the country are still battling to keep their heads above water and keep their homes,” said Shelter chief executive Campbell Robb.

The charity also warned that increasing interest rates on home mortgages would pose a threat to more households. According to financial markets, interest rates are to rise to three percent by the year 2018.

The Resolution Foundation, a think tank, warned that 770,000 British home mortgage holders will struggle to pay their mortgages when the rates rise over the next four years. The think tank also said by 2018 more than two million of Britain’s 8.4 million mortgagors will be forced to spend more than a third of their disposable income on monthly repayments.

In addition to rising interest rates, Britain has seen increasing house prices. In the past 12 months, the prices have gone up by about 10 percent and based on the forecast of a Reuters poll of analysts, the prices will continue to rise another eight percent this year.

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