Telegraph - HPC not over yet

Graham_Devon

julieq wrote: »

rate of struggling SOARING innit

Well, looking at the rate of bankruptcies, the rate of debt relief orders, the rate of those in arrears and just looking around there into the general economy, I would say yes.

If you have any evidence to say were not struggling more now than 2 years ago, please do put it up for discussion.

chucky

Graham_Devon wrote: »

Well, looking at the rate of bankruptcies, the rate of debt relief orders, the rate of those in arrears and just looking around there into the general economy, I would say yes.

If you have any evidence to say were not struggling more now than 2 years ago, please do put it up for discussion.

so all of this constitutes the title of the thread and the HPC isn't over.

what a great supportive argument

Graham_Devon

Well feel free to counter it.

At least I'm putting an argument forward, even if it is no good.

the_ash_and_the_oak

Graham_Devon wrote: »

Quite clearly it's not over yet. You don't need the Telegraph to tell you that!

When was the last crash that ended in the middle of a, as the BOE put it, deep recession?

When was the last time that a large part of the population were struggling to pay their mortgage as histrorically low interest rates, that when the interest rates inevitably went up, suddenly, everyone was fine?

think the problem for future prices isn't struggling current owners really but lack of future buyers with requisite borrowing ability to support current prices imo

Graham_Devon

the_ash_and_the_oak wrote: »

think the problem for future prices isn't struggling current owners really but lack of future buyers with requisite borrowing ability to support current prices imo

I'd class that as struggling too, in my opinion. Struggling to raise the cash needed to buy a home.

chucky

the_ash_and_the_oak wrote: »

think the problem for future prices isn't struggling current owners really but lack of future buyers with requisite borrowing ability to support current prices imo

your focus is all wrong Graham - this man has just answered your question

Graham_Devon wrote: »

I'd class that as struggling too, in my opinion. Struggling to raise the cash needed to buy a home.

that wasn't in your post - hence the reply...

Really2

ad9898 wrote: »

I think the point Graham was making is a relatively small amount maybe struggling now, but that wouldn't be the case if/when the bank rate hits say 5%, which is still very low. An example would be that when IR's were well into double digits in the early 90's, there was no help for homeowners, no rescue schemes, no government leaning on the banks not to repossess etc....... yet this time we have all this with very very low rates and repo's are still going to approach those of the early 90's.

Surely proof that the item that people are taking a loan out on is too expensive for the salaries that people are earning.

I still go with most overdue mortgages are down to loss of job rather than IR rate. I would still think that would be the case in most recessions high IR or not.

chucky

ad9898 wrote: »

I think the point Graham was making is a relatively small amount maybe struggling now, but that wouldn't be the case if/when the bank rate hits say 5%, which is still very low. An example would be that when IR's were well into double digits in the early 90's, there was no help for homeowners, no rescue schemes, no government leaning on the banks not to repossess etc....... yet this time we have all this with very very low rates and repo's are still going to approach those of the early 90's.

Surely proof that the item that people are taking a loan out on is too expensive for the salaries that people are earning.

mortgage rates were at 5% or 6% a year agao - why would they all of a sudden start to struggle if they went back to this level?

Graham_Devon

chucky wrote: »

mortgage rates were at 5% or 6% a year agao - why would they all of a sudden start to struggle if they went back to this level?

Wages are going down.

Costs are increasing again at the moment (food is going up I believe, as is petrol again).

Savings interest is also less, a big factor I believe from talking to people out there in the real world, who used savings interest to top up their income.

Tax rises are on their way.

Less chance of remortgaging to get a better deal, which was the norm a couple of years ago.

Lots of people on fixes about to, or having recently come off, may see prices come down as they go onto the SVR, but looking at history, mortgage rates are much higher than the base rate, and I do not believe they will correlate any time soon, so basically I'm thinking mortgage rates will be higher if we get back to 5% base rates than they were the last time we were at 5% base rates.

A lot of credit cards have had their interest rates put up, and you can't swap as easy anymore, which means more debt payments each month too.

Consolidate all that into one, and some families will end up bringing in the same or less, buying the same, paying the same debts off, but it all costing them more, meaning less money available.

Plus, with job losses, many will find themselves with only one income instead of 2.

IMO.

I feel I should also add a disclaimer. I am not talking about any specific family, or that every family has debts and so on. Not every family will struggle. I am literally saying more families will struggle more.

StevieJ

the_ash_and_the_oak wrote: »

just meaning there were real price drops rather than nominal price drops (guess it depends on your POV whether these count as drops or not)

They don't force people into negative equity.