We’d like to remind Forumites to please avoid political debate on the Forum.

This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Debate House Prices


In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non MoneySaving matters are no longer permitted. This includes wider debates about general house prices, the economy and politics. As a result, we have taken the decision to keep this board permanently closed, but it remains viewable for users who may find some useful information in it. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Mortgages at most affordable for 14 years

124

Comments

  • antrobus
    antrobus Posts: 17,386 Forumite
    thescouselander wrote: »
    .... It is only a measure of affordability within an oversimplified model of the housing market.

    Correct.

    Here's the most recent Halifax version
    http://www.lloydsbankinggroup.com/media/pdfs/halifax/2013/060813_HPI.pdf

    Here's the most recent Nationwide version
    http://www.nationwide.co.uk/hpi/historical/Aug_2012.pdf

    Apparently the long term average of the ratio is supposed to be 4. Since the number is currently higher than 4, I'm not that sure that it explains why housing is currently 'affordable'. I'd have thought it had more to do with interest rates being on the floor.
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    antrobus wrote: »
    I'd have thought it had more to do with interest rates being on the floor.

    It is.

    I don't know why people try to convince others it's anything different.
  • ukcarper
    ukcarper Posts: 17,337 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Graham_Devon wrote: »
    It is.

    I don't know why people try to convince others it's anything different.


    I'm not sure they are, as you say it's obvious so why do some people keep trying to deny that they are.
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    ukcarper wrote: »
    I'm not sure they are, as you say it's obvious so why do some people keep trying to deny that they are.
    Because their views are so entrenched due to their environment and financial situation that they refuse to acknowledge the obvious proof and information contradicting their blinkered viewpoint.
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    edited 18 August 2013 at 7:41PM
    ukcarper wrote: »
    I'm not sure they are, as you say it's obvious so why do some people keep trying to deny that they are.

    Ok, does this help?

    UK Housing Affordability ratio.
    120919-4.JPG
    uk-house-value-vs-uk-house.html

    It dropped off a cliff in 2008.

    What happened in 2008? The same...they dropped off a cliff.
    uk-base-rates-90-09.jpg

    You don't need to be einstein...

    You can even see the blip in both graphs where interest rate falls halted for a couple of months.
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    Graham_Devon wrote: »
    You don't need to be einstein...
    Until that post, there was me thinking that the base rate and the mortgage rates were different things. Obviously not...
  • Loughton_Monkey
    Loughton_Monkey Posts: 8,913 Forumite
    Part of the Furniture Combo Breaker Hung up my suit!
    chucky wrote: »
    Until that post, there was me thinking that the base rate and the mortgage rates were different things. Obviously not...

    If you study a little bit more dilligently, you may eventually achieve a PhD at the Devon School of Economics. I think they use a glossary containing the word "correlation" and it says "see 'equality'".

    Armed with your PhD, you can stay alert until the base rate doubles to 1%, and then you can beat GD at his own game and be the first to post. You know the sort of thing....
    • Carney doubles base rate.....
    • All house owners facing doubling of mortgage rate.....
    • House prices will crash......
    • We're all doomed......
    • I told you so.....
    Also, if you wish to appear to be "as clever" as Graham, you need to learn the technique of explaining away 'good news' on the economic front. For example..
    • Yes, more new houses have been sold last month, but that's only because they started building a few more 6 months ago....
    • Yes, affordability ratio has improved, but that's only because wages have gone up.....
    • Yes, mortgage lending has hit a new peak, but that's only because banks have more money to lend....
    • Yes, unemployement has fallen, but only because there are more jobs...
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    Loughton_Monkey wrote: »
    If you study a little bit more dilligently, you may eventually achieve a PhD at the Devon School of Economics. I think they use a glossary containing the word "correlation" and it says "see 'equality'".

    Armed with your PhD, you can stay alert until the base rate doubles to 1%, and then you can beat GD at his own game and be the first to post. You know the sort of thing....
    • Carney doubles base rate.....
    • All house owners facing doubling of mortgage rate.....
    • House prices will crash......
    • We're all doomed......
    • I told you so.....
    Also, if you wish to appear to be "as clever" as Graham, you need to learn the technique of explaining away 'good news' on the economic front. For example..
    • Yes, more new houses have been sold last month, but that's only because they started building a few more 6 months ago....
    • Yes, affordability ratio has improved, but that's only because wages have gone up.....
    • Yes, mortgage lending has hit a new peak, but that's only because banks have more money to lend....
    • Yes, unemployement has fallen, but only because there are more jobs...
    What a great post.

    One thing I'm glad of is that he spends his life on the Internet instead of mixing with real people.
  • IveSeenTheLight
    IveSeenTheLight Posts: 13,322 Forumite
    dryhat wrote: »
    You must be really stupid if you think lending more and more money to buy increasingly more expensive houses is a good thing.

    Is it stupid to pay people more each year for doing the same job?
    :wall:
    What we've got here is....... failure to communicate.
    Some men you just can't reach.
    :wall:
  • black_taxi_2
    black_taxi_2 Posts: 1,816 Forumite
    Debt-free and Proud! Mortgage-free Glee!
    im seeing quite a few fixed price properties edinbugh,people needing to sell for next move up
    £48515 interest £181 (2009)debt/mortgage-MFIT/T2/T3
    debt/mortgage free 28/11/14
    vanguard shares index isa £1000
    credit union £400
    emergency fund£500
    #81 save 2018£4200
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 352.4K Banking & Borrowing
  • 253.7K Reduce Debt & Boost Income
  • 454.4K Spending & Discounts
  • 245.4K Work, Benefits & Business
  • 601.2K Mortgages, Homes & Bills
  • 177.6K Life & Family
  • 259.3K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 37.7K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.
Update Your Picture