Fears are growing that buy-to-let investors could drop out of the sector as they remortgage next year.
Over 1.5 million borrowers will come to the end of their deals in 2024, according to figures from trade body UK Finance – many of whom will see their monthly payments go up by hundreds of pounds.
Landlords have been forced to either sell property or raise rents in order to cope with the soaring costs.
Rents hit a record high in July to September, according to the property platform Rightmove, with average bills outside the capital now standing at £1,278 per month.
The IMF said that mortgage rates have risen across the globe. Households in Australia, Canada and New Zealand, where a large proportion of borrowers are on variable rate deals, are especially vulnerable to rising rates, leading to double-digit falls in house prices.
The IMF said that real house prices in advanced economies declined 8.4pc in the first quarter of 2023, compared to 2.4pc in emerging markets.
House prices in the UK have dropped for the sixth consecutive month in a row, data from Halifax showed on Monday, with the average price of a property now £278,601.
The IMF also has downgraded its UK growth forecast from 1pc to a mere 0.6pc in 2024 and expects UK inflation to remain the highest in the G7 next year.
