When interest rates to go back to normal many more distressed sellers?

southantrim3

When the interest rate bubble finally bursts a lot of people are going to be in a very poor financial position. Even a 0.5% rise will add on over £100 per month to the average £150k mortgage.

buglawton

debtistheft wrote: »

Normal is 15%, not the cheap credit fuelled rate levels seen when Labour came to power or the credit crunch fuelled levels seen since they were thrown out.

Once we get rates back to a decent 15% level, house prices will fall like ninepins. Home owners are going to ate houses and that's a good thing. Idiots.

High interest rates existed when inflation was high - the 'real' rate of interest is always a percent or two above inflation and has loosely tracked inflation for years. In those higher interest days inflation meant that houses really would be worth more the following year so borrowing at frightening interest rates like that wasn't so crazy. And in real money terms, 12% inflation means that your debt is 'worth' 12% less the following year.

Regarding the facts of the matter, when were interest rates actually at 15% for any length of time, apart from after Black Wednesday when UK crashed out of the Exchange Rate or during the hyper-inflation of the 1970s?

Link: Bank Rate Graph since 1970

chucky

southantrim3 wrote: »

When the interest rate bubble finally bursts a lot of people are going to be in a very poor financial position. Even a 0.5% rise will add on over £100 per month to the average £150k mortgage.

what rates were these people paying before the rates dropped?

DervProf

chucky wrote: »

what rates were these people paying before the rates dropped?

You might also want to consider their other costs of living, and maybe their incomes before you draw conclusions from your rather simple point.

Graham_Devon

DervProf wrote: »

You might also want to consider their other costs of living, and maybe their incomes before you draw conclusions from your rather simple point.

Thank you.

You have just reminded me...new thread time.

DervProf

Graham_Devon wrote: »

Thank you.

You have just reminded me...new thread time.

Well, I'm glad that I may have been of service. It was, however, a very valid point, IMO.

chucky

DervProf wrote: »

You might also want to consider their other costs of living, and maybe their incomes before you draw conclusions from your rather simple point.

oh i do, i'd do the math or even discuss it with you Dervprof but it would be wasted.

i'll let let devon start another thread on interest rates in his desperate spamming of the forum.

System

Anyone have any ideas how to get rid of debtistheft? I'm sure all sides of the argument can agree this is a better board without it.

FTBFun

Joeskeppi wrote: »

Anyone have any ideas how to get rid of debtistheft? I'm sure all sides of the argument can agree this is a better board without it.

They're on my ignore list now. No point arguing with this person.

They'll be back soon with another persona though.

DervProf

chucky wrote: »

oh i do, i'd do the math or even discuss it with you Dervprof but it would be wasted.

!!!!-a-doodle-do !