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Are the glory days for the UK's housing market about to come to an end? Potential first time buyers are being forced into a catch-22 situation of rising fuel costs and rising interest rates. According to the Centre for Economics and Business Research, house prices will fall by four percent in 2023. This perfect storm of spiralling household bills and interest rate hikes reduces what people can afford, and as we all know, Affordability is the most important word in the housing market. 
The fact that housing policy wasn’t higher up the agenda of both Prime Ministerial candidates is questionable. While it may not be an immediate vote winner, the reform of our antiquated planning regulation would at least start to get Britain building the new homes we so desperately need. We will have to wait and see if our new PM, Liz Truss, tackles any of this. The ongoing under-supply of housing isn't the only thing that’s underpinning prices – but if interest rates get stuck at around 6%-7% for any length of time, as is widely predicted , everything changes. 
And it’s not just bad news for prospective homebuyers. Existing mortgage holders will have their finances severely put to the test in 2023. 
The latest energy price cap will undoubtedly affect affordability assessments as another few hundred pounds a month of income that could have been used to pay a mortgage gets eaten up. Will this make mortgage lenders and brokers even busier though? As many people simply won't be able to swallow increased energy costs on top of higher interest rates come remortgage time, thus forcing many to sell up and downsize.  
It's vital that people coming to the end of a fixed rate mortgage start planning six months before it finishes in order to secure a new rate, or other options. Here at The Rosewater Group we have over 15 years experience in the UK lettings market and can advise you on the best options for you, wherever you are in the UK. 
Although Liz Truss’s Energy Price Cap Guarantee gives a bit more stability to the fuel crisis for some, many families will still be concerned. Bearing in mind that a “typical household” is a three or four bedroom house with three of four inhabitants, this will affect a lot of mortgage borrowers. Combine this with rising rates for those on variable products, plus the surge of fixed rate expirations expected in the next six months, many will only be able to fix again on higher rates than their existing products. 
In an ideal world lenders need to start being more proactive on offering generic budget planning and guidance on keeping household costs to a minimum. Investment in this assistance now will only strengthen borrower relationships for the future and bring to attention any potential arrears sooner rather than later. 
Lenders will be reviewing their affordability calculators for sure, and it remains to be seen whether Energy Price Guarantee will make a difference in what they can offer first time buyers. A few days ago we checked affordability with one prominent lender, and having checked just before writing, they are now offering £8,000 less on the maximum people can borrow, 
The fuel crisis will also make some buyers far more conscious of how energy efficient properties are. There will be a greater emphasis on the Energy Performance Certificate of a property, and some buyers will even rule out whole types of houses because of this score. 
Household credit card borrowing rose to its highest level in more than 16 years in April, suggesting more Britons are turning to debt to cope under the current circumstances. This could also impact a person's homeownership plans as lenders take into account a person's debt as a proportion of how much they are earning. 
We have a very tough situation for many aspiring first-time buyers who could afford to make monthly mortgage payments but cannot afford to buy because ever spiraling house prices mean that the deposits required to get a mortgage are just too much. 
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