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Debate House Prices
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Bank of England may put limit on mortgage ratios
CRASH_BANG_WALLOP
Posts: 661 Forumite
The Bank of England could intervene and cap the maximum mortgages available to borrowers to stop another credit crisis, George Osborne said on Monday night
Banks and building societies could be barred from offering loans if a buyer puts down only a small deposit.
Ahead of the credit crisis, buyers were offered mortgages worth more than the properties they were purchasing – or only a small amount less than the home's value.
When property prices fell, many were plunged into negative equity while other borrowers could not afford their mortgages.
Last night, Mr Osborne said the Financial Services Bill would give a new Bank of England committee powers to "alter the maximum loan-to-value ratios in mortgage lending to curb a sharp, unsustainable rise in house prices".
:T:T:T
Banks and building societies could be barred from offering loans if a buyer puts down only a small deposit.
Ahead of the credit crisis, buyers were offered mortgages worth more than the properties they were purchasing – or only a small amount less than the home's value.
When property prices fell, many were plunged into negative equity while other borrowers could not afford their mortgages.
Last night, Mr Osborne said the Financial Services Bill would give a new Bank of England committee powers to "alter the maximum loan-to-value ratios in mortgage lending to curb a sharp, unsustainable rise in house prices".
:T:T:T
Maidstone Prices - average reductions at 8.5% (£19,668) Feb 2012 - We thought the dudes were not allowed to drop prices?
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Comments
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I would also go further and go back to strict earnings multiples as well.0
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That will be 95% mortgages, better than currently available
'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
shortchanged wrote: »I would also go further and go back to strict earnings multiples as well.
its a start dude. no more loose or crazy lending by the banks :beer:Maidstone Prices - average reductions at 8.5% (£19,668) Feb 2012 - We thought the dudes were not allowed to drop prices?0 -
Good news for BTL - more restrictions for owner occupiers means less pesky competition from FTB's and more potential customers having to rent.
I would have thought building more houses would curb sharp unsustainable house price rises. Never mind though at least this way his rich mates can fill their boot with cheap BTL's.
That's what we want isn't it?0 -
A load of hot air. The BoE wil sit on their hands just like they did throughout the previous bubble.0
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shortchanged wrote: »I would also go further and go back to strict earnings multiples as well.
What multiple would you recommend?0 -
Good news for BTL - more restrictions for owner occupiers means less pesky competition from FTB's and more potential customers having to rent.
I would have thought building more houses would curb sharp unsustainable house price rises. Never mind though at least this way his rich mates can fill their boot with cheap BTL's.
That's what we want isn't it?
Unless they stick to 75% on BTL mortgages :P0 -
Yes, and what were those earnings multiples? Exactly houses will never return to the old levels ever again. I'd have thought that posters on this forum would be adult enough to accept that, obviously there are a few you keep their heads buried in the sand. As long as there is that economic naive element in society then BTL will thrive.0
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how much is a house really worth , if you restrict loan muliptles and going by the average earnings in the u.k at around 20 or 25k , no house should be worth more than 65k.I owe £3233 @ 0%0
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Losing_the_way wrote: »
Exactly houses will never return to the old levels ever again.
They will, and sooner than you think. The new boom is already underway in the South East. You will dismiss this post as it causes you cognitive dissonance.
By 2015 we will be well into growth and the new era of prosperity and people ain't goona stop comming to these shores.
BTW - the UK mortgage market had remarkably low repossesion levels in spite of everything.0
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