With interest rates set to increase in the near future some commentators argue this could be the signal for house prices in the UK to collapse either at the end of 2007 or in 2008.

Worries over the UK housing market have increased due to turbulence in the US housing Market. In the US house prices have been falling significantly. However, the reasons for the fall in US house prices are somewhat different. There is no reason it has to occur in the UK.e

However there are various reasons why thUK Housing Market is different to the US housing market.

Why House Prices are unlikely to Collapse

1. Differences in Sub Prime Market.

The US sub prime market was more aggressive in its sale of "bad credit mortgages". Although the UK mortgage lenders have become less stringent they still retain more safeguards in checking a mortgage plan is payable.

2. Shortage of Supply in UK. Excess supply in US.

In the UK there is still a fundamental underlying shortage of housing. In the US there is a growing surplus of housing. The excess supply of housing is a consequence of the irrational exuberance generated in the housing boom of 2002-2005. There is an increase in the number of houses without owners.

3. Differences in Interest Rates.

US interest rates have increased from a low of 1% in 2003 to their current rates of 3.5% This has had a significant impact on increasing cost of mortgages. In the UK the increase in interest rates has been a smaller and more gradual process in last year UK interest rates have only increased by 0.75%

4. Population growth.

The UK is witnessing an increase in the number of households. This is caused by:

Immigration from Eastern Europe

Demographic Factors such as rising number of single people.

Aging population, increasing number of old people living alone.

Combined with a shortage of supply this explains a significant reason for increase in UK house prices.

Interest Rates likely to Peak soon

Inflation is still quite low. Moderate rises in interest rates are likely to be sufficient to reduce any lingering inflationary pressure.

More info on your stop foreclosure information search:

Get Free Foreclosure Advice and Free Refinance Quotes
Get your free on-line foreclosure refinance quote and free advice from foreclosure mitigation specialist in minutes. Compare real offers from top national subprime and hard money lenders... more...

Keep Those California Dreams Coming
We keep hearing about dropping house prices, and of course we know it is true. But the fact is that prices in California have dropped so much that you should consider grabbing up a bargain for yourself. Recent reports have shown continuing increases in foreclosed houses and several western states ... more...

Why Staging Your Home May Get You More Money
Buying a home is an emotional time because people are not just purchasing a home; they are buying a what they have thought about for a long while. If you can help them see the home as it will be when they move in they don't have to rely on their imagination You may find it hard to believe but a ... more...

How Does Slumping Housing Market Cause Little Tommy's Anxiety?
Little Tommy sat cross-legged on his front porch, carefully listening to his daddy reminisce with Uncle Bob about the good 'ole days'in the housing market. The good 'ol days. How long ago they seem. Within hours, maybe minutes, of hitting the market, or perhaps before hitting the market, sellers ... more...

Why UK House Price Collapse is Unlikely
With interest rates set to increase in the near future some commentators argue this could be the signal for house prices in the UK to collapse either at the end of 2007 or in 2008. Worries over the UK housing market have increased due to turbulence in the US housing Market. In the US house prices ... more...