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Debate House Prices
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Pensions to be used for mortgage guarantees?
Comments
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HAMISH_MCTAVISH wrote: »
Most banks won't let you include the FHOG in the 5% minimum deposit. It has to be 'genuine savings'. It is still very helpful when buying your first house as is the lack of requirement to pay stamp duty on your first purchase.
As to the OP, I think it's a terrible idea.0 -
HAMISH_MCTAVISH wrote: »A 10% fall in house prices turns a 5% deposit into a 5.5% deposit.
The problem isn't prices. It's deposits.
Requiring a 25% deposit to get a decent rate is absurd.
But if the average house falls in price, the same amount of mortgage money can buy more houses.0 -
HAMISH_MCTAVISH wrote: »A 10% fall in house prices turns a 5% deposit into a 5.5% deposit.
The problem isn't prices. It's deposits.
Requiring a 25% deposit to get a decent rate is absurd.
a decent deposit reduces risk to the lender, and to the buyer. I dont think asking for 25% is absurd
However, when you're asking for 25% at current price levels, with current wage levels, then you have a big problem, hence the hair brained schemes the goverment keeps chucking out to 'help'
Surely even you can see that lower house prices, with decent deposits is the best outcome for everyone?0 -
Most banks won't let you include the FHOG in the 5% minimum deposit. It has to be 'genuine savings'. It is still very helpful when buying your first house as is the lack of requirement to pay stamp duty on your first purchase.
As to the OP, I think it's a terrible idea.
Perhaps it's one of those 'ideas that show we are doing something', even something poor.
Families do fall out. How do they propose to resolve the resulting fall out?0 -
a decent deposit reduces risk to the lender, and to the buyer. I dont think asking for 25% is absurd
However, when you're asking for 25% at current price levels, with current wage levels, then you have a big problem, hence the hair brained schemes the goverment keeps chucking out to 'help'
Surely even you can see that lower house prices, with decent deposits is the best outcome for everyone?
Unfortunately there is no way Hamish can ever see this point of view because he would be financially shafted. He's put all his eggs into the property market basket and he needs house prices to rise.
By the way Hamish.......... aww bless, been thanked by prickypants. :grouphug:0 -
But if the average house falls in price, the same amount of mortgage money can buy more houses.
OK, so then a 10% fall in prices results in 49.5K mortgages a month instead of 45K mortgages a month.
Utterly meaningless when we need 150K mortgages a month or more just to keep up with the current and expected housing need, let alone begin to address the 5 year, million plus, backlog.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
But is this the case? Consider a 10 year fix available at 5-6% (with a sufficient deposit to allow lenders to meet Basle 3 capital rules) For many people such mortgages would be cheaper than the amount they currently pay in rent. Doesn't this suggest that property prices are not unaffordably high?shortchanged wrote: »Has anyone grasped the fact that it is high house prices that are the problem?
All these schemes do is highlight that property is still far too unaffordable to many.
Hamish you are not doing a 'devon' and commenting on the poster rather than the subject are you?HAMISH_MCTAVISH wrote: »The Following User Says Thank You to shortchanged For This Useful Post: Show me >>
re-wired (Today)
Awww, bless.
So is the amount available for mortgage lending capped or is it not the case that banks could expand their balance sheets if the lending was within the basle 3 low risk category?But if the average house falls in price, the same amount of mortgage money can buy more houses.I think....0 -
shortchanged wrote: »Unfortunately there is no way Hamish can ever see this point of view because he would be financially shafted. He's put all his eggs into the property market basket and he needs house prices to rise.
That's fascinating.
Can you explain how I'd be "financially shafted" if prices fall, or why I "need" prices to rise?“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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