So we have a hung parliament – possibly the worst political scenario for the country.
At a time when stock markets are stuttering, Greece is imploding, fear of debt contagion is rising and the national debt is ballooning there is no clear indication of the economic path we will travel.
This sends a confused signal to the markets and risks tipping our fragile economy over the edge. The greatest risk to home owners is that interest rates will rise.
Should they jump to 3.5% the Centre for Economics and Business Research says the 6.8 million home owners on variable rate mortgages would be hit hard.
Someone on a typical £150,000 repayment mortgage would have to find an extra £4,500 a year, or £375 a month – an impossible task for many given the state of the labour market.
Inevitably, this would lead to a flood of homes coming onto the market, sending house prices plummeting and throwing more home owners into negative equity.
Moody’s says the UK will probably hang on to its AAA rating with a hung parliament because all parties agree the deficit needs to be cut. The problem is that none agree how or on what timescale.
Even under the CEBR’s best-case scenario rates could rise to 2%, adding £188 to monthly mortgage bills. Bond yields will also go up, and consequently so will fixed rate mortgages.
Public sector unemployment is set to rise along with interest rates – a perfect storm. How many have insurance in place to limit the damage?