European property now unlikely to crash

The prospect of a crash in European house prices is now a less likely possibility for overseas property investors than was previously thought, reports claim.

Rising interest rates had been expected to lead to a sudden drop in demand in the European property market, Reuters reports, but it is now anticipated that the slowdown may not be as severe as first feared.

Speaking at the European Mortgage Federation in Brussels, Simon Whalley pointed out that borrowers are most interested in levels of affordability on any property they buy.

“Although rates are rising, they are still affordable,” he said.

“What matters to borrowers are monthly [mortgage] payments, and these are at relatively reasonable levels.”

According to the report, the ability that overseas property investors have to make payments is also being more closely considered by lenders, following the crash that was seen in the early 90s and the resultant improvements in risk management techniques.

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