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Invest in property with a cheap mortgage

Date: Thu, 19 Jan 2006

Despite growing returns on the stock market many brokers are still advising people to take advantage of cheap mortgage deals and invest in property.

The last 12 months has seen the FTSE All Share Index increase in value by more than 20 per cent. However, the average UK house price rose by under five per cent over the last year but brokers still believe that the property market is set to continue as a good investment, according to research from UCB Home Loans.

The study, conducted in December and January involving 523 mortgage brokers, discovered that 55 per cent believe that property will yield greater profits than shares.

"We are expecting a drop in interest rates some time in early 2006, with house price rises remaining in the zero to three per cent range over the year," said UCB Home Loans managing director Keith Astill.

He added: "The longer-term picture on prices is less clear, but the research shows that brokers are obviously expecting property to outperform equities over the next five years."

The growing competition in the housing industry means that many lenders are offering potential homeowners a number of cheap mortgage deals that could enable strong returns in their investment.


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