Vote on 3x salary mortgage cap

Graham_Devon

Really2 wrote: »

Not true either if you say 25% deposit and £25K salary.

a £100,000 house would be your limit.

10% wage inflation would cause

£110,000 house

Max afordable by that person is now £107,500 (given 10% pay rise)

The better off will always cause HPI because the population is to big (unless ther was a min 3 bed house for everyone).

Like I have siad you cant explian what as happened in the South East on just mortgages or the whole country would be just as overblown as the south east.

Yes, but we don't often get 10% wage rises, so your point is inflated.

If we had 10% wage rises, the economy would be in the sh*t again, which wouldn't neccesarily mean the house jumps in price.

ginvzt

I think it it is not just 3x salary that should be capped. A few years back, back at home, there was what I thought was very useful for mortgages - it worked like this:

It was decided that person needs £X amount to live on a month. The amount is multiplied by number of adults in the household, the children are allocated a lower amount, lets say £Y. So, the repayment you could make towards your mortgage from your salary, £Z could not be higher than what is left. So, if your household income is £3000, and lets say adult needs £700 to live on, and a child £350, so 2 adults + 2 children family, could only get a mortgage with the repayments are no more than £900.

So, for an average earners (each adults gets around £25k), they could get a mortgage of £150k over 25 years, assuming interest rates are ~5%. This would stop those on lower income getting mortgage they can't afford in the end. And banks stopping offering silly amounts - when we were FTB 2 years ago, on combined income of just under £50k we were offered a mortgage of £260k!!!!!! And that was for a 100% mortgage!!!!!! Well ,we said no, thank you and took £75k with LTV of 55%.

Really2

ad9898 wrote: »

I, you would have more money to spend in the general economy.

But there is only so much crap you can buy before you start to have an excess.

if I had a mortgage of 3X my wage our house would have around £1500-£2000 diposible income doing nothing each month (that is after bills food, clothes, entertaiment everything i do now).

I would not be on my own on that either.

It would be foolish to think a masive amount of cash sloshing around would not cause HPI or inflation in other ways.

Really2

Graham_Devon wrote: »

Yes, but we don't often get 10% wage rises, so your point is inflated.

If we had 10% wage rises, the economy would be in the sh*t again, which wouldn't neccesarily mean the house jumps in price.

Graham are you some kind of drone.

Even at 2% it would still be marginaly lower affordability each year as the deposit actualy makes up the last 1/4 of the house price.

The OP said houses should be linked at the same rate as wage infaltion. I used 10% as a simple example (although still not simple enough for you)

Grow up and go and storm off again !!!!!!.

To make it simpler Graham links to wage inflation would only work if mortgages were 100%
Do we want to go their again?

chucky

i think that we should cap salaries too so that the people that cannot afford property can get their 3 times salary property.

it will be happy days all around

StevieJ

If we had 3X it would create excess demand (with no outlet i.e. higher prices), does this mean that we would need to move to an allocation system like coucil housing? maybe that was what the old building society managers did:rolleyes:

GDB2222

It also depends on the interest earned on the deposit.

Really2

GDB2222 wrote: »

It also depends on the interest earned on the deposit.

Would that not be historicaly lower than inflation so the deposit would actualy be losing money.

ad9898_3

Really2 wrote: »

But there is only so much crap you can buy before you start to have an excess.

if I had a mortgage of 3X my wage our house would have around £1500-£2000 diposible income doing nothing each month (that is after bills food, clothes, entertaiment everything i do now).

I would not be on my own on that either.

It would be foolish to think a masive amount of cash sloshing around would not cause HPI or inflation in other ways.

If I had a 3x mortgage, was happy where I was living and had £1500-£2000 spare every month, I would be finding new hobbies, finding new interests, going on holidays, buy a new motorbike/car... or if I was living with someone and we had children, I would ask her if she would like to cut her hours, or pack in work and spend more time with the children, or cut back my hours if possible to spend more time with my family.

The possibilities are endless, instead what we have had up to now is "do we have enough money to cover the £1000+ mortgage every month , if not, I wonder if we could could cut back, or do some extra hours at work, after all childcare places are open from 7am until 6pm.... etc", a miserable existance if you ask me, I'd much sooner do what's in my first paragraph.

HPI is "one persons perceived wealth and another persons real debt", I'd almost say it's a cancer of society.

Ian_Griffiths_Halifax

chewmylegoff wrote: »

afraid not.

they pay corporation tax on profits and chargeable gains, and the rate is up to 30% depending on the total profit.

Sorry to send the thread off track again, but could you clarify this for me?

http://www.hmrc.gov.uk/cgt/intro/basics.htm

Particularly this bit?

For limited companies capital gains form part of the total profits of the company on which they pay Corporation Tax.

Do they pay Capital Gains Tax at the same rate as their Corporation Tax, or do they not pay Capital Gains Tax? Have HMRC got their own rules wrong? I bow to your superior knowledge.