BOE Rates hit 1.5%

mr.broderick

Welshlassie wrote: »

They've been cut to 1.5 %
www.bbc.co.uk

Doubt it will mean much though!!

Just done some sums and if i bought my house today (I have factored in 15% drop from when i purchased) and borrowed the full amount on an interest only mortgage (obviously i would get a better rate with 15% deposit) i would pay £700 a month. There is a rather friendly australian solicitor who rents a house in our drive and she pays £850 a month. Looks like this house would be cheaper to buy, obviously at the end of the term the full capital would have to be paid, i envisage in 25 years this house would have doubled from todays prices.

Broken_hearted

chucky wrote: »

the monthly mortgage will now be £300 less interest paid per month per 0.5% drop.

my residential mortgage is nearly 100% offset currently paying 2.4% - once i get to 100% decisions will have to be made

and you're right that it's a great opportunity for many people

Use it as much as you can as its going to go way up.

mr.broderick

carolt wrote: »

Wow, you must have a big mortgage.

Explains your fear and aggression when confronted with the fact that house prices are falling.

My mortgage costs aren't falling because I don't have one.

But the prices of houses I want to buy are falling at about £5000 a month.

Stick that in your pipe and smoke it.

Ahh the ever friendly carolt appears on the forums today with news that the base rates are now 1.5%. I am still trying to work out where your aggresion comes from carol. I'd guess it is the fact you rent a house instead of own one. It is what i hate about these forums these days, it is ok to gloat and post graphs showing house price decline but whenever someone who actually owns a house has some good news for them they are attacked. Hate it.

IveSeenTheLight

chucky wrote: »

the monthly mortgage will now be £300 less interest paid per month per 0.5% drop.

my residential mortgage is nearly 100% offset currently paying 2.4% - once i get to 100% decisions will have to be made

and you're right that it's a great opportunity for many people

Wow £300 per month on a 0.5% drop.
That would mean a £720,000 mortgage.
My 4 bed house, 2 bed flat and overseas property does not add up to that in value let alone a mortgage

lisyloo

Welshlassie wrote: »

They've been cut to 1.5 %
www.bbc.co.uk
Doubt it will mean much though!!

There is an argument that this might mean more than previous cuts.
The reason is that some SVRs have a guarantee e.g. base +2.0 and some have now hit this margin.

Just a thought.

Old_Slaphead

Really2 wrote: »

If everyone goes bust you wont have any savings.;)

How do lower interest rates help?

In this case it's just about taking money off a bunch of people with no mortgage & savings and giving it to a bunch who have no savings & mortgage.

I suspect that the latter will just use their windfall to pay down debts and not consume more.

lisyloo

I think carolt does have a point (even if you don't like the way she/he made it).

Capital values are falling heavily which mortgage costs are going down somewhat.
If out of the market it's better to stay out.

I'm an owner and I'm not moving because I have a lovely house, lovely neighbours and it's a long term home.
However I can take a balanced/objective view and recognise that prices are falling rapidly.

Doens't mean that either renters or owners are in a better posistion.
There are high transactional costs associated with housing.
If you are out it's better to stay out.
If you are in for most people with a long term home it's probably better to stay in.
If you have to move for job purposes or some other reason then it may be best to get out of the market if you can (but for some people have their OWN home is still very important).

lisyloo

In this case it's just about taking money off a bunch of people

It's not jsut about individuals.
Businesses form a part of the economy too and need credit to both survive and invest.

Really2

lisyloo wrote: »

It's not jsut about individuals.
Businesses form a part of the economy too and need credit to both survive and invest.

Exactly the rate cuts are to help business and the economy. Cheaper mortgages are a secondary product.
At least some people get it.;)

chucky

mr.broderick wrote: »

Ahh the ever friendly carolt appears on the forums today with news that the base rates are now 1.5%. I am still trying to work out where your aggresion comes from carol. I'd guess it is the fact you rent a house instead of own one. It is what i hate about these forums these days, it is ok to gloat and post graphs showing house price decline but whenever someone who actually owns a house has some good news for them they are attacked. Hate it.

ah yes Brodders - how could it not be a Thursday without an angry Carol post...

I'm sure the usual suspect will pop along and defend her and tell you to "try contributing something on topic to the group instead of picking on other posters?"