Nationwide UP 0.6% MoM & UP 0.9% YoY

IveSeenTheLight

Graham_Devon wrote: »

Apart from this is nothing like the depression of the 30's.

I listened to an article on my local station the other day, as the traffic news cuts in whle driving, and they seem to forget to turn it off. Was discussing local housing, so tuned in.

They had 2 people discussing the issue, one a BTL. The BTL landlord had, since 2008, taken on another 7 properties. This, in his own words, was due to lower mortgage payments on his existing portfolio allowing him to direct the cash saved into a 2nd mortgage. He stated he is able to pretty much pay 2 mortgages for the price of 1 in 2006.

That got me thinking, as BTL's have no real problem in getting mortgages. Were seeing the effects of this, as he can't be the only one taking advantage of cash flow, in the home ownership statistics.

We've got a lending / debt / housing crisis issue, allowing more debt and lending to happen for those in the game.

We've got, what are now classed as completely normal rock bottom interest rates which we are now building new foundations on. We've got to a point where gone is the prospect of interest rates going up and people holding back. People are now treating them as the new norm and plannign around it. Taking finance based on it and building up new portfoilios.

We've got stock markets that take not a blind bit of notice of the Greek crisis anymore, but have a mini surge when another unsustainable package is announced. The markets now KNOW that Greece will not be allowed to default, and therefore take no notice of all the nonsense surrounding issues.

We've probably got more QE coming, as no matter how much they pump in, the pound still rises. Must be annoying Mervyn somewhat....or is it?!

That Thursday meeting at the start of the month used to mean something. Now no one even cares. We all just assume, quite rightly to be honest, nothing will be done to upset the new applecart.

My point isn't being made very well, I realise that. What I am saying is I was wrong. I assumed, naively that a crash meant a crash. I didn't assume a crash meant everything that caused the crash got richer and thrown not only a lifeline, but better conditions to carry on with the problems that caused the crash in the first place.

WOW, you got all that from one BTL story.

I just recently bought, refurbished and am now leasing a property whereby the mortgage rates would have to increase to circa 12% before I was negatively impacted.

I am aware that rates will rise at some point, but am capatilising while the sun shines (in rate terms)

Do I expect rates to rise to 12%? Possibly, but I don't think overnight and I'll have the opportunity to fix long before it gets there.
Meanwhile, the income received can be invested elsewhere, pay down the mortgages or used to expand the portfolio further.

Graham_Devon

IveSeenTheLight wrote: »

I'm sure the pack of chocolate digestives would fall under the luxury category.
It's not exactly staple food.

You also need to wonder why chocolate has increased so much.
Could it be because of supply and demand?

There are still chocolates buying chocolate (no offence just meant as a stupid joke), thus demand is maintained, meanwhile supply can be restricted because of investor cornering the market
http://www.bbc.co.uk/news/business-10682433

As in any market, supply and demand drive the prices and whilst we can complain that inflation is high it's simply a reflection of the affecting parameters.

I saw a documentary the other day regarding the cost of childcare in the UK compared to other places such as Norway.
UK costs were higher predominantely because the cost of employees (partly as a result of minimum wage and regulations).

They will rise until the market demand is reduced to meet the supply, else the supply is increased to cope with the demand.

Cost rises are not all supply and demand however.

Fuel for instance has hit record highs for diesel. Yet we have reduced our consumption.

The knock on of that is that food prices are increasing and factory gate inflation is increasing. None of it to do with using more fuel.

We used less gas over winter, therefore already there are warnings of increased gas prices this summer to make up for the shortfall over winter. Again, reduction in useage equals the possibility of higher prices.

Graham_Devon

IveSeenTheLight wrote: »

WOW, you got all that from one BTL story.

No I didn't get it all from one story. Was using it as a mere example to try and get the point I was making across.

IveSeenTheLight

Graham_Devon wrote: »

Cost rises are not all supply and demand however.

Fuel for instance has hit record highs for diesel. Yet we have reduced our consumption.

A simple explanation that the rise in fuel costs has driven the demand to look at alternative supply, thus reducing the demand.

Fuel is also another example where the market is affected by additional factors such as duty, whilst VAT is also applied.

Quite simply, if fuel prices did rocket, you would clearly see many using alternative transport options i.e. sharing / cycling / walking / public transport etc

Graham_Devon wrote: »

The knock on of that is that food prices are increasing and factory gate inflation is increasing. None of it to do with using more fuel.

So ask yourself, what is causing the prices to increase?
How is the food industry transporting it's goods?

Graham_Devon wrote: »

We used less gas over winter, therefore already there are warnings of increased gas prices this summer to make up for the shortfall over winter. Again, reduction in useage equals the possibility of higher prices.

I've seen in general price increases when useage is higher in winter and then "drops" when useage is lower.
Gas suppliers know the fluctuation in the months and factor these in.
You can pay more in the summer to cover the increase in the winter.

Mr._Pricklepants

Graham_Devon wrote: »

Fuel for instance has hit record highs for diesel. Yet we have reduced our consumption.

The knock on of that is that food prices are increasing and factory gate inflation is increasing. None of it to do with using more fuel.

Someone explain to this Devon bloke the difference between UK and global demand please.

CRASH_BANG_WALLOP

MrRee wrote: »

Big payrises are feeding through - 6% minimum here due very soon ....

retired and still working dude?

and as if by a mircale mr ree and mr pinkpants are here

IveSeenTheLight

Graham_Devon wrote: »

No I didn't get it all from one story. Was using it as a mere example to try and get the point I was making across.

I gathered, hence my example to show an alternative to

Originally Posted by Graham_Devon
People are now treating them as the new norm and plannign around it.

Of course I am capatilising on low rates which are increasing my profits for investment elsewhere.

Originally Posted by Graham_Devon
Taking finance based on it and building up new portfoilios.

ruggedtoast

Graham_Devon wrote: »

My point isn't being made very well, I realise that. What I am saying is I was wrong. I assumed, naively that a crash meant a crash. I didn't assume a crash meant everything that caused the crash got richer and thrown not only a lifeline, but better conditions to carry on with the problems that caused the crash in the first place.

I gave up when I finally realised how much the system is rigged by the people who run it, and how blatantly they manipulate it to benefit themselves.

All you can try and do is second guess what they are thinking and try and protect yourself somehow.

In the first housing crash "they" wanted their money back when the system collapsed and they got it, foreclosing without mercy and pumping rates, but it came back to bite them as the resulting financial crash hit the City and shareholders.

As soon as you start reading all the articles about politicians fiddling their BTL mortgages through expenses, and seeing how much money the City is making from a housing shortage its obvious things are only going one way.

They won't take any of the pain this time, the loans will stay out there, the banks will be saved at whatever cost, and the taxpayer will bear the burden of underwriting all of it.

We might get a dozen houses on new developments here and there in the SE, after years of wrangling with placard waving NIMBYS, but there will be no move towards affordability for a long time to come, not unless there is a knock on benefit somewhere for the elite.

Dan:_4

Graham_Devon wrote: »

My point isn't being made very well, I realise that. What I am saying is I was wrong. I assumed, naively that a crash meant a crash. I didn't assume a crash meant everything that caused the crash got richer and thrown not only a lifeline, but better conditions to carry on with the problems that caused the crash in the first place.

Some of us spent years trying to tell you this!

Graham_Devon

Dan: wrote: »

Some of us spent years trying to tell you this!

No one told me low interest rates would last so long people would start planning their finances around them.