"Secret" 95% mortgage proposals to help FTB's

Really2

Graham_Devon wrote: »

So...what do you think of the fund and 95% mortgage idea?

If there is a kitty to protect the equity or to support the credit (which seems to be the idea) I can't see what the problem is.

If the lending is reasonably protected why have an issue with it?

If it made 95% mortgages more common place as a response due to the introduction I can't see why people would dislike it, unless people need continuing low sales volumes and less people buying for a reason?

If someone wants to buy at a price at 95% and that product is maintained by a fund why fear it? the fund is the bailout if it goes wrong not the tax payer this time.

Graham_Devon

Bohdy wrote: »

Just as happened at all other times in the past, it will this time as well.

Well, it won't if they keep inventing schemes.

I just wonder how much trickery they can keep pulling out from sleeves.

The only problem with these solutions is that the government and therefore the taxpayer becomes more and more intertwined in the housing market for every prop up scheme that arrives.

It's inevitable this cannot continue. It is afterall, nothing more than a pyramid scheme. The more incentives you give, the higher prices rise to pay for that prop, the more incentives needed and so on.

The more intertwined we become as a nation in propping up house prices through newly implemented schemes, the larger our exposure as an entire country to any problems further down the line.

That's my view anyway.

Really2

Graham_Devon wrote: »

The only problem with these solutions is that the government and therefore the taxpayer becomes more and more intertwined in the housing market for every prop up scheme that arrives. .

Why would the tax payer be liable for this if they are creating a fund (EG builders and banks pay in to at the start of the process) that would cover defaults etc?

If this was done on 100%+ loans in the boom the problem would not have been so big as the funds would have been there (and the rates would have been higher) to cover those loans should they go bad.

wotsthat

Graham_Devon wrote: »

I just wonder how much trickery they can keep pulling out from sleeves.

The only problem with these solutions is that the government and therefore the taxpayer becomes more and more intertwined in the housing market for every prop up scheme that arrives.

There's no trickery. The builders are businesses trying to expand their customer base whilst not reducing list prices. They'd much rather act as guarantors on 5% than reduce prices by 5% (which wouldn't help buyers get mortgages anyway). No government involvement either.

All sounds a bit complicated though. I'd expect that sensible buyers would see that saving a larger deposit is likely to be more cost effective in the long run.

geneer

HAMISH_MCTAVISH wrote: »

Do you think we needed a second thread on the topic?

Only if the first thread has been started by someone spectacularly unpopular.

DervProf

Graham_Devon wrote: »

Well, it won't if they keep inventing schemes.

I just wonder how much trickery they can keep pulling out from sleeves.

The only problem with these solutions is that the government and therefore the taxpayer becomes more and more intertwined in the housing market for every prop up scheme that arrives.

It's inevitable this cannot continue. It is afterall, nothing more than a pyramid scheme. The more incentives you give, the higher prices rise to pay for that prop, the more incentives needed and so on.

The more intertwined we become as a nation in propping up house prices through newly implemented schemes, the larger our exposure as an entire country to any problems further down the line.

That's my view anyway.

And I see exactly the same thing.

Well said.

brit1234

First time buyers don't want any more crazy schemes propping up high prices, shelter report proved that.

Really2

brit1234 wrote: »

First time buyers don't want any more crazy schemes propping up high prices, shelter report proved that.

If people don't want it I am not sure why the people on here worry about it.

Seems like some are afraid 95% mortgages could keep/increase prices.
If they have the courage of their convictions they should stop worrying about things like this if there is no demand it wont work.

But it seems some think it will otherwise they would not be going on about how bad it is for everyone.

chucky

brit1234 wrote: »

First time buyers don't want any more crazy schemes propping up high prices

is that because of the one man first time buyers strike?

do you have a banner we can see or when you're staging your first sit down protest?

FTBFun

brit1234 wrote: »

First time buyers don't want any more crazy schemes propping up high prices, shelter report proved that.

I take it you're excluding yourself from that category, seeing as you'll never be buying a house?

6.6% YOY in Hounslow. Keep it up.