Interest rates & inflation

B

bearbear

Registered User
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Hi all,

Thoughts on mortgage rates? They have been steadily decreasing the last few years but with the risk of inflation rising on the horizon are we all better off fixing for a longer term?

Cheers,

BB
 
So fix for a shorter term in the hope rates will have reduced further? A lot of banks are offering say 3 year / 5 year fixed term at similar enough interest rates
 
In my opinion, and that's all it is, there's room for a tightening of margins, given where wholesale markets are. I'd like to see 10 year rates well under 3% before fixing for a longer term.
I think we'll see 3 year rates settling around 2.2 - 2.3% mark, and then that rate being made available for longer terms rather than banks dropping headline rates below 2%.
KBC were offering a 10 year rate just under 3% in early 2008. Wholesale rates have dropped a lot since then, but mortgage rates haven't followed yet.
 
Given lower competition in the market (Ulster exiting) - do you expect there's going to be enough competition to drive down the margins on the mortgage products?

What would be the first sign that would indicate higher inflation/rates going up in the future? I.e.: will people be able to fix long term before rates rise? (I'm guessing no, however, I'm curious..)
 
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