Likewise, I was surprised to learn that you guys in the US had access to such long term fixed rate mortgages! I'd assume that your system promotes a greater accumulation of debt and thus pushes up house prices.

Ten years ago the average UK house price was ~£170k, and now it is sitting at around ~£290k (a ~70% total increase, or ~5% / year). Which doesn't seem so bad, until you realise that average wages have only risen by ~20% in the same time period.

orthwyrm

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saloon

It blew my mind the first time I heard about the rarity of fixed rate mortgages like we have here in the US. I don't know if the US has more fixed rate mortgages due to free market forces or regulation. My guess is a bit of both. I can't imagine taking out a 20 year variable rate loan. Makes me wonder if variable rate mortgages lead would lead to less debt which might lead to lower real estate prices (a force driving down market price).