The United Kingdom suffers a real estate crisis, but experts rule out a conta...

mateolevi2024

The housing market in the United Kingdom is not going through its best moment. As in most countries in the world, the rise in interest rates (which are already at 5.25%) has generated an increase in the cost of mortgage loans, which has caused the greatest drop in the price of the property. housing in the country in the last 14 years.

However, the fight against inflation and the increase in the price of money is not only taking place in the British Isles, but our country must also battle against the increases Chinese Student Phone Number List made by the European Central Bank until leaving rates at 4.5 %. In addition to monetary restriction measures, the Spanish real estate market also shares high inflation with that of Great Britain , which has already considerably limited the savings capacity of families.

At a European level, inflation continues to punish the pockets of households that increasingly reduce their savings capacity, which affects consumption and their ability to purchase a home . In the United Kingdom, this has already generated worrying data in the real estate sector, with a drop in housing demand which, in turn, is worsening the rental stock problem.



In fact, the price to rent a room has skyrocketed above 1,000 pounds per month , which is about 1,170 euros. This data is due, in part, to the shortage of rental homes on the market, something that has generated a  15% increase  compared to data from a year ago in the rental prices of a room in the capital.

The  high mortgage interest rates , which have reached 15-year highs, have decreased the profitability generated by a rental for owners, which is why they prefer to sell.

Experts do not expect a contagion effect. The result that these common factors between Spain and Great Britain are having on the islands could be a prediction of what would happen in our country in the future. We Spaniards lost purchasing power by 5.6 points in 2022, according to data from the Ministry of Labor , despite the largest salary increase. Therefore, inflation is significantly affecting the pockets of Spaniards and, consequently, could limit demand that reached maximum levels after the pandemic.

The loss of purchasing power of families could lead the market to a slowdown in transactions, says Ricardo Sousa, CEO of Century 21 , especially those involving used homes, as well as a reduction in the value of real estate.