Many of us have been closely following the sad and shocking news about the Russian invasion of Ukraine. You’re likely aware that sanctions on Russia will have an impact on fuel prices – but did you know that the UK property market might also feel the effects?
Firstly, with around 150,000 Russians living in London, prime property prices may be impacted by the potential seizure of Russian property assets and economic sanctions on oligarchs living in the UK. But the invasion of Ukraine, and the resultant upward price pressure on Russian and Ukrainian exported goods such as oil, gas, aluminium, nickel and sunflower oil, is pushing the already high cost of living ever higher. And one measure that the Bank of England uses to combat high inflation is to increase its base rate – which then has a knock-on impact on mortgage rates, though not immediate for existing fixed-rate mortgages.
While the economic fallout of the Ukraine invasion remains uncertain, there’s one thing about which the experts all agree: the only way is up. And higher interest rates, coupled with the squeeze on household finances, have the potential to slow the housing market following an incredibly buoyant couple of years.
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