what will the interest rate cut do to house prices?

chucky

Cat695 wrote: »

The way I see it now people who are saving to buy a house have just been kicked in the teeth......why save when you don't get anything for it?

It will take people even longer now to gain enough for a mortgage (reading on the bbc news website lending is going to become even more restricted).

So yes a few will rush out now to buy but again it will just be a knee jerk reaction......I don't expect to see house buying on mass for a long time yet.

Cat - i wouldn't be worrying about your deposit. there will be mortgage deals in time that will be much more attractive. banks will need to see who is bravest and makes the first move now.

On another note - HPC posters usually congratule themselves about earning £3,000 by just looking at the Halifax and nationwide figures published each month.

They're probably the same type of fool who believed they had many money when the numbers were positive.

I hope that you get the deposit together and the right mortgage deal appears for you.

IveSeenTheLight

Jim_B wrote: »

I didn't buy a 500 000 pound house at the weekend, so I've saved half a million. Can anyone beat that?

Yeah, about a month ago I looked round a £1.3million pound house and didn't buy it.
(Well actually, we were only looking at the decor styling )

IveSeenTheLight

dopester wrote: »

I like this chart which tracks affordability all the way back from 1996 to 2007, and with it HPI.

UK: In 2007 the ratio is 8.19, which means that a household would require over 8 times the average earnings in order to afford a property. Thank Gordy's setup for lenders for dishing out the easy money.

Just wondering, where did you get the above affordability figures.
They seem well off from stats I have seen.
HBOS shows an average peak in Scotland of 4.83 in 89 Q2 and the UK average peak at 5.98 in 07 Q3
Here's the link

sarkin

StevieJ wrote: »

Maybe a once in a lifetime chance of fixing on a long term low rate.

you could fix for ten years and up to 25 years with some lenders last year and for the last 3 years at 4.99%.

Not many took it

dopester

IveSeenTheLight wrote: »

Just wondering, where did you get the above affordability figures.
They seem well off from stats I have seen.
HBOS shows an average peak in Scotland of 4.83 in 89 Q2 and the UK average peak at 5.98 in 07 Q3
Here's the link

Well... without really wanting to get in to the subject... my source for the affordability figures was close to your area, so I presume they have good data for their report and analysis:

Source: Aberdeen City Council
http://www.aberdeencity.gov.uk/ACCI/...=13760&sID=332

Together with many another chart:

JayScottGreenspan

Jim_B wrote: »

I didn't buy a 500 000 pound house at the weekend, so I've saved half a million. Can anyone beat that?

A lot of people on this thread are deliberately misinterpreting the word 'saved'.

If you want to pretend you're £500k beter off for your decision, that's your fantasy. If others want to pretend that future FTBs don't benefit every time house prices fall by another few thousand, that's their fantasy.

It doesn't constitute an argument, it adds nothing to the debate, and it's pretty childish.

carolt

sarkin wrote: »

you could fix for ten years and up to 25 years with some lenders last year and for the last 3 years at 4.99%.

Not many took it

When we were looking to buy back end 2006/start 2007, we had a mortgage agreed in principle on a long-term fix of I think 5.49%? for 15 years. Long term fixes were certainly available, but just not widely used, as the broker tried to talk us out of it, on the grounds that circumstances might change (although I was OK with that, as it was fully flexible and portable and you could overpay as much as you liked, with no penalties for paying off early).

I wasn't going to risk a better-rate 2 year fix, say, to save a small amount upfront, and am constantly amazed at how many people took a long-term financial decision ie taking on a huuuuge mortgage, but with only a very, very short-term safety net.

Which explains my lack of sympathy for said people - the long-term fixes were there, if people wanted to take them.

EdInvestor

hethmar wrote: »

I guess the one light is that there should be less repossessions, which in a way should help stabilise house prices.

Northern Wreck has cut its SVR by the full 1.5%, could make a significant difference to the repo problem.

JayScottGreenspan

carolt wrote: »

When we were looking to buy back end 2006/start 2007, we had a mortgage agreed in principle on a long-term fix of I think 5.49%? for 15 years. Long term fixes were certainly available, but just not widely used, as the broker tried to talk us out of it, on the grounds that circumstances might change (although I was OK with that, as it was fully flexible and portable and you could overpay as much as you liked, with no penalties for paying off early).

I wasn't going to risk a better-rate 2 year fix, say, to save a small amount upfront, and am constantly amazed at how many people took a long-term financial decision ie taking on a huuuuge mortgage, but with only a very, very short-term safety net.

Which explains my lack of sympathy for said people - the long-term fixes were there, if people wanted to take them.

In my experience, the brokers try to steer people away from long term fixes.
Wonder if it's got anything to do with them wanting their fee every two years...?

Lenders fees are going to increase, BTW. The banks can mitigate the costs of rate cuts by upping fees.

Existing customers coming to the end of short term fixes face a choice - line the banks pockets via the SVR or inflated fees.
New customers get shafted.

confused31_2

pickledpink wrote: »

The rates won't affect me! My house is paid for lock, stock and barrell!:p

But I'm glad that some hard-working families with young kiddies will now be able to enjoy Christmas without the fear of having their homes repossessed!!!:T

Aren't you glad for that too?

We know the rates wont affect you your flat is paid for lock stock and barrel by the local council, and they even pay your rent.:T

confused