The property boom is well underway now.

Really2

Graham_Devon wrote: »

It's a collosal difference!!!

So a person on IO in the same house as you is better off in your senario as they "survive" on more money than you and are even less dependent on a higher wage?

I get what you are saying but you making out someone on IO was struggling more than you is completely wrong IMHO.

Harry_Powell

Graham_Devon wrote: »

It's a collosal difference!!!

What if I don't want to move? I have my interest only mortgage at year 25, and owe £130k for the house.

The house may now be worth £500k.

But to pay for the house, I have to sell it.

No thanks! HUGE differences.

Why would you want to live in a house that was no longer suitable for your lifestyle (i.e. retired couple or singleton)?

Rattling around in a huge family home in retirement is just as uncomfortable as squashing into a small home with a family. Your housing requirements don't remain static throughout your entire life.

NPowerUser

No signs of a boom here.

Prices down 10%-15% from their highs of 3 years ago in my area.

House prices seem stable over the past 9 months or so but I think with the election resulting in a possible hung parliament, much higher inflation and interest rate rises due on the horizon, when fuel increases filter through to the price we pay for goods in the shops, I would be shocked to see any boom.

It would be nice to see a gradual increase in property prices but I think they are more likely to remain stable until the end of the year.

Graham_Devon

Harry_Powell wrote: »

I think you missed the point graham. You don't pay off the 5 bed home at year 25, you don't need the 5 bed home any more because the kids have left home. You downsize and buy a smaller home outright with the HPI gains you made over the 25 years (or 30 or 40 years before retirement).

I didn't miss the point.

What if you do not want to sell the house? You are left with no choice. Everything is a gamble, spending your 30 years working to get to the point where you have to sell your home to pay for it.

What if I get to the point where I am selling the larger house, only to find my daughters parner has left her with a kid in tow and she has no where to go, and I have to say to her "oh sorry, I have no space for you in the family home, I have to sell up".

Theres loads of reasons why I may not want to move.

For really to tell me thats a slight difference to owning your home is hysterical.

I haven't got issue with what you have said, it's everyones choice, it's really trying to make out this is merely a slight difference. It's vastly different.

Really2

Thrugelmir wrote: »

Courtesy of the CML from their 2010 budget submission.

Courtesy of the CML from their actual sales info 2009.
http://news.bbc.co.uk/1/hi/business/8545906.stm

People buying their first home were aged 27 on average in the north of England and in Yorkshire and Humberside.
Those in the North paid an average deposit of 19%, the figures showed.
First-time buyers were oldest on average in Greater London at 30, the Council of Mortgage Lenders (CML) said.

Emy1501

I can't really believe that the OP would be admitting to carrying out the type of deals he is on a publice forum. At best they are unethical and to be honest bordering fraudulent.

Thrugelmir

Really2 wrote: »

TBF if you paid the same IO as you did repayment there is no actual difference, you still have to service the debt the same.
Just that one the debt is slightly decreasing over time.

Whats happened is that people have borrowed the maximum they can on interest only, ie more capital. Rather than taking a more cautious what they can afford on a repayment basis.

The winner in this scenario is the repayment mortgage holder who will benefit from owning a higher % of their property. The i/o mortgage holder only benefits if HPI runs away. An era thats been and gone.

Really2

Graham_Devon wrote: »

For really to tell me thats a slight difference to owning your home is hysterical.

Did I say that I thought saying there was no difference to that cash you have each month if you pay out £500 in repayment or £500 in IO.
Just that one debt is gradually decreasing over time.

another false statement.

Kohoutek

Emy1501 wrote: »

I can't really believe that the OP would be admitting to carrying out the type of deals he is on a publice forum. At best they are unethical and to be honest bordering fraudulent.

Mortgage fraud qualifies as criminal offence under the Fraud Act 2006, punishable by a maximum of ten years in prison and an unlimited fine. Looks like the FSA is beefing up its enforcement division:

http://www.cml.org.uk/cml/policy/issues/3997

Probably not something that's a good idea to get involved in.

Really2

Thrugelmir wrote: »

Whats happened is that people have borrowed the maximum they can on interest only, ie more capital. Rather than taking a more cautious what they can afford on a repayment basis.

The winner in this scenario is the repayment mortgage holder who will benefit from owning a higher % of their property. The i/o mortgage holder only benefits if HPI runs away. An era thats been and gone.

I am not promoting either but as in life and what JB wrote there are winers and losers.

The biggest winners and losers are usually ones who take the most risk.