Foreclosures Force Britons to Ponder Shift to Fixed Rates – New York Times
Whether they can is an open question, especially given Britons’ attachment to home ownership, adjustable-rate mortgages and personal debt. British consumers are the most indebted citizens of any Group of 7 nation, and television shows devoted to real estate and debt advice are among the most popular programs in the country.
Currently, only 5 percent of British home buyers take out fixed-rate mortgages. The norm here is a mortgage with a fixed rate for the first two years, and then a floating rate for the duration of the mortgage.
In fact, the National Housing Federation recently predicted prices would rise 40 percent in the next five years, elevating the average price of a home, which already costs about 11 times the average British salary, to £302,400, or $618,000.
Some day we’ll beat Britain. Some day.