Wake up Bears its feeding time

JonnyBravo

the_ash_and_the_oak wrote: »

Which is why I'd feel a lot more comfortable borrowing when rates were high, not when they are low

I get what you're trying to say but it's coming across a bit skewiff.

Sounds to me like you're going to be searching round for the worst mortgage deal you can find.

the_ash_and_the_oak

JonnyBravo wrote: »

I get what you're trying to say but it's coming across a bit skewiff.

Sounds to me like you're going to be searching round for the worst mortgage deal you can find.

right, but...you get the point i'm making? Or why (at least in a hypothetical sense) I would think this?

Thrugelmir

chucky wrote: »

these types of long term fixes will not be cheap until credit is freely available again.
when credit is freely available house prices are already on the increase - you'll be hot by a double wammy. house prices more expensive and higher mortgage rates.

Ten year fixes are available at 6% now. So depending on your view of interest rates in the medium tem they could be a viable choice now.

Cheap money has gone. At least until the clever bankers find further loop holes in the regulatory system to create more.

New lending will a minimum of 2% above base. It could take a whole generation for the housing market to turnover and normalise. So until then there will winners and losers.

Thrugelmir

GDB2222 wrote: »

You mean the lender's misery? I feel no sympathy for them.

Have no worries. They will claw the money back (for their shareholders ).

chucky

Thrugelmir wrote: »

Ten year fixes are available at 6% now. So depending on your view of interest rates in the medium tem they could be a viable choice now.

that's not a cheap rate - 2 years ago 10 year fixes were between 4.5% and 5% but house prices were higher.

that's the point...

HammerSmashedFace

StiflersMom wrote: »

And if you profit from someone else's misery by picking up a repo, so much the better, eh?

Disgusting

Although not nice for those involved, repo's are absolutely necessary in a housing market cycle and completely natural, they allow new investment in at lower prices, they teach people that there is an endgame if they take too may risks in speculating etc...

This particular part of the cycle has been artificially halted by 400 year low IR's and state owned banks that are keeping people in their homes even if they've defaulted by more than 9 months ( I know someone this is happening to as I speak).

The result of this meddling ??, it is not known at this time, but is unlikely to be good news over the medium/long term. HPI has been let go so far out of hand over the past decade, that like these huge banks etc...... HPI is too big to let fail, if we had 35-40% off peak nationally we would almost certainly have state failure.

So we are throwing the kitchen sink at the problem, will it work ??, not sure, interesting times ahead.

Pobby

Well it`s not gone the way i thought it would. can only base my experience on the last recession. I didn`t expect the base rate to be as low as it is now and I think everyone will admit that has had a direct influence on keeping house prices high.

I can`t see that IR`s can stay this low for a lot longer. The government needs to bear in mind that there is a powerful group of people with savings. Pensioners. Many of whom rely on a decent return on capital. A lot of pensioners are going to feel angry right now and this might well be expressed at the polls.

Stiflersmum. If you read this and can be bothered, I would be interested to read your ideas behind the statement that early in 2010 prices will take off at a canter.

HammerSmashedFace

I do chuckle a little at some of the posts i read, surely people can see the elephant in the room can't they ?, or do people just cover their eyes and ears and shout la-la-la ? What we have seen is postponement of the inevitable, that's all.

People are reading all sorts into the HPI over the last months (in certain areas I might add), yet anyone with an eye for the obvious can see that the market is far from normal and is being rigged by the government in the hope of re-election, transactions 50% down, IR's with nowhere to go now only one way, RMBS dead (hence the transactions), QE....etc, the list goes on and on.

It should have already ended in tears by now and we could have started building the foundations of the economy in general, but no, we've had to meddle and the result will be us, as a country and economy losing ground on the rest of the world.

It's only a matter of time.

Thrugelmir

chucky wrote: »

that's not a cheap rate - 2 years ago 10 year fixes were between 4.5% and 5% but house prices were higher.

that's the point...

You need to look forward not back. If base rate rate hits 5% in a few years time. Then SVR rates of 8% plus are quite conceivable, fixes potentially higher.

chucky

Thrugelmir wrote: »

You need to look forward not back. If base rate rate hits 5% in a few years time. Then SVR rates of 8% plus are quite conceivable, fixes potentially higher.

that wasn't and isn't the point that you raised...

the point was that the cheaper long term fixes are only really available when HPI is in full flow. so more expensive house prices cheap loans.

long term fixes are more expensive as house prices are cheaper. cheaper house prices more expensive mortgages.