ThinkMoney.com advises caution over house price predictions
on: August 7, 2008, 7:48 am
Release Author: Think
Release Summary: Following suggestions that house prices will
rise by 25% by 2013, financial solutions company ThinkMoney.com
have advised homeowners not to become complacent about protecting
themselves against the current downturn in the housing market.
Release Body: Responding to the recent report from the National
Housing Federation suggesting house prices will recover
and rise by 25% by 2013, financial solutions company ThinkMoney.com
advised existing homeowners to remain optimistic, but warned them
not to become complacent about protecting themselves against the
downturn in the housing market.
National Housing Federation anticipates further
falls in house prices for the next two years – 4.4% in 2008,
with a further fall of 2.1% in 2009 – after which prices
will begin to recover, rising by 25% by 2013.
the report itself acknowledges that the figures depend on a ‘robust
employment market’, and warns that if employment and consumer
spending levels fall by too much, the housing slump could be more
severe than they have predicted.
spokesperson for ThinkMoney.com said: “We
would advise homeowners to continue saving well, spending responsibly,
and to remain aware of the potential problems facing the housing
market. Your financial planning should, as always, be geared towards
making sure you are prepared for any problems that could arise.
report is only speculative, and as with anything, it is very hard
to predict what will happen in the next five years. The predictions
are essentially a best-case scenario,” she said.
a sense, it’s healthy to be slightly cautious when it comes
to money, especially with an important financial commitment like
spokesperson said that there are a number of ways homeowners can
protect themselves. “Savings are the key,” she says.
“Falling house prices means that equity tied up in the value
of your home is decreasing, so it’s wise to try and counteract
that by saving money where possible.
also acts as a buffer if you find the interest on your mortgage
payments going up in the next few years, which is quite possible.
Without savings to fall back on, mortgage payments could become
simply too expensive for poorer families, and that brings the
possibility of falling into debt – especially with other
costs of living rising so quickly too.
it’s important to keep an eye on spending and make sure
unnecessary purchases are kept to a minimum. Avoid taking out
consumer finance loans on expensive goods, as they can become
a big financial burden when things get tight,” she continued.
“In fact, avoiding any form of personal loans or credit
is the best defence against getting into debt.”
ThinkMoney.com spokesperson advised homeowners
to remain positive. “Many homeowners will be relatively
unaffected by the problems in the housing market, so long as they
are willing to stay put,” she said.
loss in the value of your home only affects you if you are looking
to sell, but it still pays to save well in case of emergency.
And once the market does recover, you may even find yourself in
a better financial situation than you were before all the trouble
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