what do people think uk interest rates are going to do in the next 10 years?

Question

i have found a 10 year fixed rate mortgage for 4.98%. It seems a good rate and less than my current variable, however, a friend says that if we join the euro in the next few years, our interest rate will go down dramatically and could therefore leave me paying over the odds. what do others think. obviously i would be tied in for the 10 year period with redemption penalties.
i have also found a good 3 year fixed at 4.89, but my worry is that if interest rates rise over that time, when my fixed ends i might have to pay much more on the next mortgage.
what do others think?

thanks

its portable so i wouldnt pay redemption penalties when i move

Answer 1

That's a good rate, make sure it's portable though as 10 years is a long time to tie yourself in for.

I think that rates will rise a bit in the new year and then drop in the later end of the year. Rates won't have the dramatic fluctuations of the late '80s because we are in a different economy. They will always be somewhere between 4% and 6%.

Personally I would go for the 3 years (as long as it had no extended tie-in) due to personal changes that may or may not happen, but if you feel confident that your life won't change for 10 years, go for it.

Answer 2

Most people don't live in the same place for more than 7 years on average so you could end up paying redemption penalties anyway if you wanted to move within the 10 years. I would take on a 2/3 year fixed mortgage then shop around when the mortgage reverted to an ordinary one, for another fixed rate one.

Answer 3

Interest rates are not likely to go down in the next 10 years. They are more likely to go up. If in the unlikely event they went down it would not be by enough to lose you money on a fixed rate deal like that. That is a very good deal and you are not likely to lose out on it.

Answer 4

cutting-edge info, information and forecasts would propose costs will proceed to be quite solid over the subsequent 5 or so years various up/down by approximately one proportion element. yet who's accustomed to what the financial company of england will do - the final 2 rises have occurred whilst i presumed it exchange into undesirable for the financial device to rasie costs, yet what would i understand i'm purely a small company proprietor, who has studied economics at A'point and has accompanied the marketplace and financial information for a while.

Answer 5

Rates should trend down as demand for loans drops. Baby boomers are retiring and so do not need loans, birthrate has dropped, so fewer babies, immigration is basically stable. so with little consumer interest in borrowing money, rates will come down.

Answer 6

they will go up to slow the house market down so house prices will drop so young people can afford a house. i would go for the 3 year one my self

Answer 7

Think you maybe right, but it would be very different if a new government took us into the Euro