Quarter of Brits on interest only mortgages

wageslave

chucky wrote: »

that would be a bit silly wouldn't it.
is that what you do?

What do you think?

Graham_Devon

julieq wrote: »

Oh come off it.

You have to absolutely cherry pick your dates and then make a massively improbable assumption to see no hpi between 1989 and 2014.

And in the WORST CASE where there is minimal HPI, there has been inflation during that period, so the size of the debt in proportion to your ability to repay it has decreased at wage inflation rates compounded.

And what have rentals done over that period? During that time mortgage interest repayments have gone down.

And how many of the 3.5M interest only mortgages started in 1989?

You are clutching at straws, you are hugely selective in terms of the data you use and you're ignoring anything that doesn't suit your arguments, but for all that you're perfectly welcome to do it your way. And good luck to you.

So after that outburst I guess it's not guaranteed

You said more in the way you said your post than you did in what you actually typed!!

Yes the data is cherry picked, because it makes the point its NEVER guaranteed! Cherry picked or not, it's real data, apart from the future, which none of us currently know.

Graham_Devon

Dan: wrote: »

According to the Nationwide index, a house worth £110,000 in 1989 is worth £272,000 today [Q2 2009]. Are you suggesting house prices will fall 150% between now and 2014?

Julie, I do hope you are going to mention the clutching of straws here. Only earlier you mentioned bears were dreaming and bulls were moderate?

Yet it appears the whole of the dataset has been changed and a different index used here to try and prove a point and ask me about 150% drops....of which, 150% could never happen

I'll leave you guys to it

chucky

Graham_Devon wrote: »

But chucky, we are talking about when the 25 year mortgage has finished.

We cant say it's guarenteed HPI will have sorted out the loan on an interest only mortgage after 25 years, and then when it's shown it's not, revert to "but people don't stay in their house for 25 years". That's arguing both ways.

Where the market goes from here is neither here nor there, the point was literally that it's not guarenteed HPI will always save an interest only buyer.

you're right on the HPI point - but salary increases etc would probably help you repay capital.

you have to agree if you're in NE after a 25 year mortgage you've got to be a bit dim.
you have to admit that this is more of an exception than the norm though

shakerbaby

Dan: wrote: »

According to the Nationwide index, a house worth £110,000 in 1989 is worth £272,000 today [Q2 2009]. Are you suggesting house prices will fall 150% between now and 2014?

Past performance is no guide to future returns.

Graham_Devon

chucky wrote: »

you're right on the HPI point - but salary increases etc would probably help you repay capital.

you have to agree if you're in NE after a 25 year mortgage you've got to be a bit dim.
this is more of an exception than the norm though, the dim bit not the NE bit

Oh I agree, I just don't agree with the guarantee thing, which seems to have caused such a raucous.

As for wage inflation, inflation would likely to also be going up, so interest on the loan would be going up, so you may not be able to save so much as you may think. Plus, and this is getting silly now, no one knows whats going to happen over 25 years. Babies could happen for instance, and your down to one wage. That don't bode too well for anything!

What I'm trying to say is, it's not all as cut and dry as some would suggest. If it was, we wouldn't be in the mess we are in now on an economic level and a personal level (so many going bankrupt etc).

Dan:_4

shakerbaby wrote: »

Past performance is no guide to future returns.

I'm not talking about past performance. :rolleyes:

chucky

wageslave wrote: »

What do you think?

i don't think that the Socratic method applies to a forum. sorry

julieq

Graham_Devon wrote: »

So after that outburst I guess it's not guaranteed

You said more in the way you said your post than you did in what you actually typed!!

Yes the data is cherry picked, because it makes the point its NEVER guaranteed! Cherry picked or not, it's real data, apart from the future, which none of us currently know.

I give up.

Graham, even if you managed to find dates between which there was minimal HPI, it DOESN'T MATTER. You are still better off than someone who rented during the same period.

As I said, in order to get that over 25 years you have to make ludicrous assumptions.

But please, do it your way.

mewbie_2

wageslave wrote: »

What do you think?

Wasting your time there. He can argue, endlessly, and it appears to give him pleasure. But as for thinking, or stating an opinion. That's different. You'll never see him in the fun threads, because he is clearly out of his depth when it's just friendly banter.