A LEADING estate agent has said that it’s the end of the housing 'bonanza' as the market comes to term with a sharp rise in mortgage rates.

Interest rates on both two-year and five-year fixed rate mortgages reached six per cent this week - their highest level in a decade.

Mortgage rates have jumped sharply since the start of Liz Truss’s premiership, and the chancellor Kwasi Kwarteng has held talks with leading UK lenders to try and forge a solution to soaring rates.

First time buyers and those looking to re-mortgage are amongst those worst affected by the rise, along with around 100,000 people who are coming to the end of their current mortgage deal at the end of the month.

“The initial impact (of rising rates) is that we’ve seen some mortgage offers withdrawn,” said managing director of Hunters Cumbria, Graeme MacLeod.

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“Clearly the same property price is now more expensive for the buyer so it’s definitely had an impact as far as sales go but not quite as much as you might have expected.”

According to Mr MacLeod, Carlisle has low levels of housing on the market and that there is currently “less than half the supply of properties available in October 2022 than October 2019.”

Before the sudden rise in interest rates, Carlisle was in the midst of a property price boom, with figures suggesting that prices had gone up by almost 10 per cent in the year to June.

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But there are now fears that the current economic situation may cause the housing market to take a hit.

“Appetite from the public is still there but let’s be sensible and mindful of the fact that if the cost of money is greater, we should not be forecasting bullish prices next year and we’ll maybe see pricing plateau.

"It’s the end of the bonanza selling market,” said Mr MacLeod.

“We have to be more moderate in terms of selling prices, but there is no evidence so far of prices being adversely affected.

“We’re pricing for the market we’ve seen over the last couple of years, and we can’t build in any optimistic growth for next year.”

After the uncertainty of future rates, hundreds of mortgage deals were pulled from the market nationally.

Though products are beginning to become available once again, a return to low levels of mortgage rates appears a long way off.

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