BBC Article - mortgage affordability has improved

barnaby-bear

http://www.bbc.co.uk/news/business-19388147

brit1234

If you have a 30% deposit or more, not if you haven't.

Affordability will only really improve when house prices fall further lower from their inflated present value.

Also we see mortgage rates continuing to rise despite BOE rates of 0.5%, Santander went up 0.5% last week. These rates will go up again when Greece defaults which the Independent stated would be November just after the US Election to help out Obama.

HAMISH_MCTAVISH

From Halifax.....

Halifax housing economist Martin Ellis said: "Lower house prices and reduced mortgage rates have led to a significant improvement in housing affordability for those able to fund the necessary deposit to enter the market over the past five years.

"As a result, mortgage payments for a typical new borrower currently account for the lowest proportion of earnings for 15 years.

"The relatively low level of mortgage payments in relation to income is providing support for house prices.

"The prospect of interest rates remaining at low levels for some time yet is expected to continue to be a key factor supporting the demand for homes, helping to keep house prices around their current level during the remainder of 2012."

HAMISH_MCTAVISH

brit1234 wrote: »

If you have a 30% deposit or more, not if you haven't.

Affordability will only really improve when house prices fall further lower from their inflated present value.

House prices are rising Brit, not falling.

ONS, Acadametrics, Land Registry and Rightmove are year on year positive.

Halifax and Nationwide are negative... But not by much.

And in the meantime rents have soared to new record highs and are more expensive than buying with a mortgage in 90% of the UK, even if mortgage rates were 5%.

Also we see mortgage rates continuing to rise despite BOE rates of 0.5%, Santander went up 0.5% last week. These rates will go up again when Greece defaults

You can now get a 25 year fixed rate mortgage for just over 5% with as little as a 20% deposit.

People should have no fear of rising rates.

barnaby-bear

brit1234 wrote: »

If you have a 30% deposit or more, not if you haven't.

Affordability will only really improve when house prices fall further lower from their inflated present value.

Also we see mortgage rates continuing to rise despite BOE rates of 0.5%, Santander went up 0.5% last week. These rates will go up again when Greece defaults which the Independent stated would be November just after the US Election to help out Obama.

but for those with a property or a btl-er with a portfolio - overpaying and building up equity seems to be getting easier. I couldn't get a mortgage at the % I did 6 years ago but my housing costs have halved and are about a third of what the rental would be. OK it makes moving harder but happy to take what we paid or less if necessary or stay a few years, get some more equity and rent it out - the fundamental sticking point is lack of housing, if you can't get a 30% deposit the choice is thus to pay a premium in rent and have a middleman (a landlord) who does... to end up in the same house.... not ideal at all if you are the renter.... but I can't see what is likely to change in the short term. Reposessions are rare with benefits willing to pay mortgage interest and rental demand strong.... smug people who think they are clever and property investors are annoying - just good luck and being the right age at the right time. However the affordability of payments for those with a mortgage and the ability to overpay is noticeable in my demographic. Even those of us who hate btl are thinking maybe building up extra equity and renting the old house out might be the easiest way to the next one. 5% is historically low and lower than we expected at the start.... we were budgetting for 15% scenarios...

barnaby-bear

brit1234 wrote: »

Also we see mortgage rates continuing to rise despite BOE rates of 0.5%, Santander went up 0.5% last week. These rates will go up again when Greece defaults which the Independent stated would be November just after the US Election to help out Obama.

Historically 0.5 % is noise; monthly changes of a 0.5% used to happen and 3% in a year wouldn't have raised eyebrows... fixed rates were rarer and it was all a bit russian roulette - the last 5 years and current outlook seem the most stable and budgetable I've seen it....

Notmyrealname

Indeed. From a budgeting point of view it is better than it ever has been.

However in respect to affordability, I bought my property at 75% LTV and a friend bought one for 95% LTV. The mortgages are exactly the same amount but his repayments are over £200 a month more than mine.

brit1234

HAMISH_MCTAVISH wrote: »

House prices are rising Brit, not falling.

ONS, Acadametrics, Land Registry and Rightmove are year on year positive.

Halifax and Nationwide are negative... But not by much.

Hamish you know very well house prices are falling and pretty much every report has prices continuing to fall.

You seem to to select data to misrepresent the figures. The only ones which count are Land Registry, Halifax and Nationwide. Rightmove uses inital asking prices and does not show reductions in asking prices from the old figures when they can't sell. Acadametrics is a fudge bof figures and not respected. ONS has been widely criticised over recent months for the way it is cralculated and has a lower status to the offical Land Registry figures within the property industry.

You say Halifax and Nationwide are negative not my much but you forget they are negative ontop of the year of falls last year. This is after the peak selling period when prices usally rise but we have entered the quieter part of the years where prices are expected to continue falling and year on year figures are expected to increase with their falls.

Nationwide, Halifax and Land Registry prices should fall below average of £160k this year.

HAMISH_MCTAVISH

brit1234 wrote: »

Acadametrics is a fudge bof figures and not respected.

That's weird Brit, your all time favourite financial publication, Moneyweek, calls it one of the two most accurate indices out there.

"So in all, if you want the most accurate picture, then the data with the longest lag – the figures from Acadametrics or the Land Registry, which are based on final sales – are probably the best to go for".
http://www.moneyweek.com/investments/property/uk/which-house-price-index-is-the-best-60003

Unsurprisingly, both of those "most accurate indices" show prices have risen year on year.

ONS has been widely criticised over recent months for the way it is cralculated

Source?

has a lower status to the offical Land Registry figures within the property industry.

Again, source?

Or is this more of your warped perspective, where you disagree with any figures that don't suit your agenda....;)

You say Halifax and Nationwide are negative not my much but you forget they are negative ontop of the year of falls last year. This is after the peak selling period when prices usally rise but we have entered the quieter part of the years where prices are expected to continue falling and year on year figures are expected to increase with their falls.

They're well above the market bottom in early 2009, you should remember that time well Brit, as it's when you claimed prices would fall 50% by Xmas.....:D

As it stands today, Nationwide is just 10.6% below peak, Land registry around 11% below peak, and ONS/Acadametrics closer to 5% below peak.

Had the average person listened to you back then, they'd be tens of thousands of pounds worse off between missed HPI and rent.

You should be ashamed of yourself, giving all that bad advice on public forums.....

Nationwide, Halifax and Land Registry prices should fall below average of £160k this year.

You've been saying that every year for the last 3 years.....:rotfl:

theGrinch

so called mortgage affordability is far removed from having a deposit in the first place

brit1234

HAMISH_MCTAVISH wrote: »

That's weird Brit, your all time favourite financial publication, Moneyweek, calls it one of the two most accurate indices out there.

Hamish, fibbing again. Oh bless.

Where did you get that rubbish from?

My favourite publication since 1997 has been the Economist.

HAMISH_MCTAVISH wrote: »

Unsurprisingly, both of those "most accurate indices" show prices have risen year on year.

Unsurprising as you take the spring bounce figures. How about we do January to January, you spring bounce gains will be averaged out and be negative.

HAMISH_MCTAVISH wrote: »

Source? Again, source?

Type both indexs together in a search engine and you will fined tones.

HAMISH_MCTAVISH wrote: »

As it stands today, Nationwide is just 10.6% below peak, Land registry around 11% below peak, and ONS/Acadametrics closer to 5% below peak.

Had the average person listened to you back then, they'd be tens of thousands of pounds worse off between missed HPI and rent.

You should be ashamed of yourself, giving all that bad advice on public forums.....

You've been saying that every year for the last 3 years.....:rotfl:

Hamish why don't you come out and say you are a House price ramper and spend all your time trolling on the internet talking up house prices.

I can happily claim house prices will continue to fall as there is not enough money to support them at these levels. Bank base rates were cut from 5% to 0.5% yet house prices continue to fall.

There is no money left to prop house prices up, they will fall to normal levels