Get ready for rates to rocket

ad9898_3

StevieJ wrote: »

I think you are so wrong there, I can't see the lenders being allowed to charge base rate + 6% to first time buyers when IR's are up to 5% Especially when the main lenders are influenced by the govt.

Oh I agree with that, but base rate +3% would not be out of the ordinary. The other issue would be we have been so used to base rate being below 6%, that a lot of people, especially FTB'rs who bought in the last 10 years, think that anything above this is cloud cuckoo land, again time will tell, but base rates above 6% are the norm if you take away the last 10 years.

The next 10 years will be much more inflationary, energy costs alone will make sure of that.

duck_3

From The Sunday Times

June 7, 2009

Halifax, Britain’s biggest provider, said last week that house prices rose 2.6% in May to an average £158,565 — their fastest rate for seven years. Nationwide’s index had prices up 1.2% in the same month. It is the first time both indexes have risen together since August 2007.
However, in a worrying trend, banks and building societies are pulling mortgage deals and raising rates, hampering borrowers’ attempts to re-enter the market.
Over the past three weeks, Woolwich, Lloyds and RBS have all withdrawn loans for purchases and have not replaced them.
Lloyds withdrew its five-year fix at 6.59% for borrowers with a 10% deposit and its two-year fixes at 4.49% and 5.89% for those with a deposit of 25% and 15% respectively.




http://www.timesonline.co.uk/tol/money/property_and_mortgages/article6445365.ece

This shows that the markets are UP and improving

dopester

ad9898 wrote: »

The next 10 years will be much more inflationary, energy costs alone will make sure of that.

Inflationary because of energy costs? :rotfl:

Energy costs are going to crash right back down and further still.

We're hostage to supply by cartels or other reluctant suppliers.. if they hate the thought of selling below what they want for their energy... but increasingly we can't afford old-world prices.

Demand is falling as well. Try and hold us hostage on market prices can't afford and it worsens the situation for end-buyers and the sellers even more so. Unless I'm misreading internal growth and ability-to-pay prospects for China and India and the like.

purch

Interest rates may rise if Government p*off the markets, and they sell off gilts, or refuse to keep buying new ones, forcing interest rates to be raised

The only thing that will cause the BOE to raise the base rate, will be yields on Gilts increasing. They can only allow the rate curve to steepen a little from where it is now.

The BOE will be forced to raise the base rate long before HPI, wage inflation or general inflation picks up, making the chances of any of them occurring that much slimmer.

dopester

duck wrote: »

This shows that the markets are UP and improving

Does it? Improving. By tightening up lending criteria to the fewer people who want to borrow, and discouraging new borrowers with higher rates?

The timidity of the banking system appears to have been general and widespread. Indeed, the 1939 survey found that over half the reasons given for credit refusals by banks were "bank policy"; only a third were because of "the condition of the borrowing concern."

-Michael A.Bernstein
The Great Depression

Graham_Devon

duck wrote: »

From The Sunday Times

June 7, 2009

Halifax, Britain’s biggest provider, said last week that house prices rose 2.6% in May to an average £158,565 — their fastest rate for seven years. Nationwide’s index had prices up 1.2% in the same month. It is the first time both indexes have risen together since August 2007.
However, in a worrying trend, banks and building societies are pulling mortgage deals and raising rates, hampering borrowers’ attempts to re-enter the market.
Over the past three weeks, Woolwich, Lloyds and RBS have all withdrawn loans for purchases and have not replaced them.
Lloyds withdrew its five-year fix at 6.59% for borrowers with a 10% deposit and its two-year fixes at 4.49% and 5.89% for those with a deposit of 25% and 15% respectively.




http://www.timesonline.co.uk/tol/money/property_and_mortgages/article6445365.ece

This shows that the markets are UP and improving

Shows they are scared shyteless if you ask me. Why would they be pulling deals if they thought they could make money from them?

They are so scared of loaning at 90%, because of the prospect of the housing stock depriciating, that they are no longer prepared to offer the loans and up their risk.

lostinrates

julieq wrote: »

Smart money goes on each way dear.

I'd agree with that.
I'd also say the smart money at the bookies is cash, not debt.
Thankfully, we're talking about houses, not horses.

ad9898_3

julieq wrote: »

Smart money goes on each way dear.

Smart money doesn't goto the bookies at all.

lostinrates

ad9898 wrote: »

Smart money doesn't goto the bookies at all.

Life is a gamble ad. at least ''gamblers'' re, by definition, aware its a ''gamble''.

duck_3

The Recession has reached its lower limit therefor banks have and will remove the lower interest rates and deals for home buyers.
Quote :
Halifax, Britain’s biggest provider, said last week that house prices rose +2.6% in May to an average £158,565 — their fastest rate for seven years. Nationwide’s index had prices up +1.2% in the same month.
It is the first time both indexes have risen together since August 2007.
The housing market as well as the stock market are on there way up.

Everything is improving, and about time....