Rate Cut Ramifications - Paul Lewis of Moneybox on BBC News

overlander

But on the flip side anyone who is saving for a house, do not get too upset about not getting 5% on your savings. As house are losing a fortune every month that more than makes up for the poor rates. Also remember when super Browns latest campaign fails they will have to try and save sterling so rates will increase rapidly. So not only will houses be tanking your savings will be earning fortunately there is no easy way out this Brown is only interested in getting elected again all these fixes are temporary. So patience is the key here.

overlander

Kenny4315 wrote: »

The house value to me is paper dollars, as I'm not selling in the near future, while a mortgage reduction represents real reduction in cost.

Fair point and good luck to you, but if i am right rates do go up if i was you i would use any savings to pay down the mortgage.

Kenny4315

overlander wrote: »

Fair point and good luck to you, but if i am right rates do go up if i was you i would use any savings to pay down the mortgage.

I have the full balance to pay off my mortgage on deposit at 7% until April. That's going to be a nice bit of interest. :money:

Then I'll decide how much to pay off my mortgage and how much to hold to invest in some BTL's.

stevetodd

indianropetrick wrote: »

Property is not a long term investment for the tens of thousands who bought in 2005-2007 at absurd prices. Their 'investment' will mean bankruptcy. This is already happening, but when the credit really drys up in the next 12 months, coupled with forced sales due to huge job losses, we're really going to see what a bad gamble property was.

It is a long term investment! Just because some fools bought property at yields that were not self supporting in the hope to make some quick cash based purely on HPI does not change he true nature of the market! The market is not about 'having a gamble' as you put it, it is about buying a sensibly priced investment, if it is not sensibly priced to give a reasonable return then it should not be bought!

chucky

Kenny4315 wrote: »

I have the full balance to pay off my mortgage on deposit at 7% until April. That's going to be a nice bit of interest. :money:

Then I'll decide how much to pay off my mortgage and how much to hold to invest in some BTL's.

show off!!!

WTF?_2

stevetodd wrote: »

It is a long term investment! Just because some fools bought property at yields that were not self supporting in the hope to make some quick cash based purely on HPI does not change he true nature of the market! The market is not about 'having a gamble' as you put it, it is about buying a sensibly priced investment, if it is not sensibly priced to give a reasonable return then it should not be bought!

The problem is that lots of fools apparently bought property as a short term investment - thus pushing the price into the stratosphere. Meaning that people who just wanted a home got caught up in the bubble and ended up borrowing silly, dangerous even, amounts on the basis of a myth that house prices would only ever go up so it was an 'investment' and a 'foot on the ladder'.

For quite a few it will be more like having a foot in a concrete boot.

stevetodd

!!!!!!? wrote: »

The problem is that lots of fools apparently bought property as a short term investment - thus pushing the price into the stratosphere. Meaning that people who just wanted a home got caught up in the bubble and ended up borrowing silly, dangerous even, amounts on the basis of a myth that house prices would only ever go up so it was an 'investment' and a 'foot on the ladder'.

For quite a few it will be more like having a foot in a concrete boot.

Yes I know but as I said that does not change the fact that it is a long term investment.

moneymare

olly300 wrote: »

You are not losing unless you are forced to sell.

If you don't have to sell for the next 8-12 years depending on the type of property you are in then you should be all right.

Quite right.......On a personal level, it suits me fine right now - better off with mortgage and no intention of moving anytime soon.

However, can see it biting plenty of people on the !!!! if & when interest rates rise again especially if house prices continue to fall......then it will get REALLY messy.

whathavewedone

I know that no one has a crystal ball but I'd be interested to hear people's views on when interest rates are likely to go up and by how much.

I'm on a fixed rate so it's not an issue for me personally for a few years yet but I would be interested to hear people's views.

I personally don't believe that we have deflation at the moment or that we are even headed that way and I don't think that the rates should be as low as they are