House prices to fall by 10 per cent next year warns veteran mortgage broker Ray Bolger

A veteran mortgage broker has warned that the housing market could be set to drop significantly following measures outlined by Kwasi Kwarteng.

A number of lenders have temporarily halted mortgage offers for new customers, with Ray Bolger warning that house prices could plummet 10 per cent following an increase in interest rates.

Santander and Yorkshire Building Society have now suspended mortgage deals after a fall in the pound fuelled forecasts of rising interest rates with Nationwide saying it will lift rates on a range of fixed mortgages.

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Nationwide, said that it had increased two, three, five and 10-year fixed-rates by between 0.90 and 1.20 percentage points.

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Other lenders have taken similar steps.

Speaking on BBC Radio 4, veteran mortgage broker Ray Bolger said: "Because people have got used to really low mortgage rates in the last 10 years, I think the consequences are going to be very significant.

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"I think we can expect to see a significant fall in house prices. I'm suggesting around 10 percent next year.

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A veteran mortgage broker has warned that the housing market could be set to drop significantly following measures outlined by Kwasi Kwarteng.

"The key thing here, you could have got a five-year fixed rate mortgage at one percent if you had a big deposit.

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"A lot of people who are thinking of buying are going to rethink those plans, they may not buy at all. If they buy, it may be at the lower level.”

He added: “At the moment, I think we're not going to see many sellers because most people have got a fixed rate and therefore it's going to take time before these costs filter through.

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"It's certainly going to have a big impact on the ability for people to buy."