Is it Time to buy and secure a long-term fixed rate mortgage?

woody252506

My personal opinion is if you can get a good fixed rate for a good number of years then do so. What do i know though im a FTB!!!;)

My (Well our as its me and my partner) plan is to wait another 3/4 months and build my deposit up even further. At the minute its at 10% but we intend hitting the 15% mark with some very hard saving.

Then after our cheap holiday away we will come back and seriously start looking again. A couple of houses we saw last year have dropped 30k and are now in the region of what we are willing to pay and can afford to with our 15% deposit amount saved and ready.

At the moment Leeds Building Society offer 5.3% fixed for 5 years with a 15% deposit and that has no arrangement fee. A full percent lower than if you had a 10% deposit.

If its available when our deposit is ready ill be going for that one!

ad9898_3

Well after the gilt auction failure this morning, I would really urge people who have a mortgage to fix, if you don't you will regret it.

neas

Our plan is to just sit it out .

penguine

Dithering_Dad wrote: »

I understand that as an individual, you have decided that the price you pay for a house is the most important thing. Other people will be looking at the price, but also may have children and will also be considering their schooling and the need to provide a stable home for them. We're all different and so discussions like this one will not be of any use to you as you have decided to wait until the market completely bottoms out. Others will be looking to buy soon (like lostinrates, for example) and so this discussion is pertinent to them.

Good thread, dd. I was skeptical of your argument to begin with, but I can see now the point you're making is a valid one for many people (though we will continue to wait as I feel that for us a lower price translates into better quality of life for the duration of our mortgage).

One thing this thread has highlighted for me is that once the bottom is reached (whenever that is) we're not going to have thousands of buyers still waiting to pile in. There are too many other individual factors determining when people will buy.

Cannon_Fodder

Does anyone know the technical side of QE enough to say whether IRs will have to stay low whilst they carry out the QE? - I believe its supposed to be spread over 3 months for the first £75Bn.

The answer to that should point in the direction of where IRs will head in the next few months.

DD and I had this discussion in December, and agreed you need to keep checking the maths for the balance between savings interest, rent, mortgage costs, and house price reductions.

I still think there is another 3 months worth of leeway in the possible reversal of IR reductions. More if QE is slow to take effect/technically requires it.

Still waiting for the wage deflation to hit properly, too, that'll be a factor as job losses/short-time working continue.

So, a year or two before double-figure IRs create a stampede.

But then I'm aiming for mortgage free anway, so not strictly led by IRs. Just that the bandwagon might start rolling if enough people panic, should IRs shoot up.

And still the right house is not on the horizon, anyway.

Pobby

Serious question. Do you think IRs will shoot up dramatically say within the year. I know nothing about it but thought that this low, low rate is about part of the stimulation. Tho not seen a lot of stimulation in my part of the woods!

ad9898_3

Cannon_Fodder wrote: »

Does anyone know the technical side of QE enough to say whether IRs will have to stay low whilst they carry out the QE? - I believe its supposed to be spread over 3 months for the first £75Bn.

The answer to that should point in the direction of where IRs will head in the next few months.

With the gilt failure today, and June futures already being marked down, QE is just going to make things worse. The government have 3 options..

1. Put IR's up
2. Slash public spending.
3. Errr, print more money.

Of course Brown would want to do No.3, which will work for today and tomorrow, but will eventually destroy the UK economy...... so Brown, what's it going to be ??

chucknorris

Pobby wrote: »

Serious question. Do you think IRs will shoot up dramatically say within the year. I know nothing about it but thought that this low, low rate is about part of the stimulation. Tho not seen a lot of stimulation in my part of the woods!

The truth is that no one 'knows' what will happen, one can only guess as QE is totally new ground. But don't forget those that are offering fixed rate deals are aware of what may and may not happen too, so they have built their perception of the risk of higher rates into the product.

Dithering_Dad

I hope that IRs hold on for at least a year because I'm stuck in my current deal for a further 12 months. :eek:

I raised the issue on this forum because I know that it can take a while to buy a house - when I bought mine it was vacant possession and I was a first time buyer, yet it still managed to drag on for four months before I moved in.

So while I don't think that we will see double digit inflation this year, it'd be a little late to warn about it in 6 to 12 months time when it's too late for prospective house buyers to do anything about it. Hence why I raised the issue now.

scousethife

Dithering_Dad wrote: »

I give in, no sensible, mature discussion to be had here. Well, at least I tried.

You give in cos you are a liar, and massively stupid too.

You said "post facts and figures" directly after I post facts and figures and nothing else for 3 post in a row.

face it sonshine the value of your beloved house is plummeting and theres eff all you can do about it.

especially desperate attempts at ramping the market on a tiny part of a website on the internet.

Its one of the most pathetic things I have ever witnessed