Under the heading ‘Need to Know: A tale of two housing markets’ the Financial Times has examined why property prices are falling in the UK and rising in the US.

The article can be read here (subscription may be necessary) and believes ‘Part of the explanation lies in the structure and operation of the mortgage market and its effect on the behaviour of owner-occupiers and potential buyers.’

Going on to say that whilst ‘ In the UK, most borrowers take out mortgages where rates are fixed for two, three or five years. Though a capital repayment loan typically takes between 25 and 35 years to pay off, they must refinance every few years when these fixed rates expire.’ but ‘US mortgage borrowers taking out a 30-year loan can lock in their rate over the full term of the loan, with no need to remortgage if they keep up their payments’