March 17, 2008 | posted by Michael Baxter in House prices |

And from woe in the US to another sign that the UK will follow suit.

According to research from Mortgage Monitor, many of those poor souls who took out fixed rate mortgages in 2003 could see their payments rise by 35 per cent.

In all, 1,143 mortgage holders were questioned; 14 per cent said they suffered from insomnia through worrying about their mortgage, and 17 per cent reported rows with their partner. One in twenty said their worries had made them physically ill.    

The survey found that one in twenty people on fixed rate deals had no idea how they would meet new repayments when their deal expires. If you extrapolate  that finding to the 1.4 million due to come off fixed rate mortgages soon, that amounts to 70,000.

The findings of this survey are at odds with conclusions drawn by the Halifax last year, which suggested the cost of migrating from fixed rate mortgages would be small, and easily affordable.

Then again, even the Halifax used that phrase “most borrowers.”

It will only take a minority of fixed mortgage holders – say one in twenty, to be forced to sell their properties, or have their homes repossessed, and the resulting  rise in properties coming on to the market will be enough to tip the housing market into crisis.

The US crisis is occurring now – there are plenty of reasons to believe the UK will follow.