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Indy - BoE pump priming of mortgage market brings house price cheer
Turnbull2000
Posts: 1,807 Forumite
http://www.independent.co.uk/news/business/news/bank-of-england-boost-housing-market-as-prices-rise-by-05-in-january-8475437.html
You've got to hand it to them. But the following snippet is what stood out...
So not only are we facing an unprecedented housing shortgage, an entrenched ultra-low base rate (market and buyers assuming a new norm), we have continued pump-priming and lengthening of mortgage terms. Factor in duel income buyers now being the norm, house prices are arguably undervalued.
The Bank of England’s pump-priming of the mortgage market fuelled some New Year cheer for homeowners today as Nationwide said average prices rose 0.5% in January.
The lender put the improvement down to the Bank’s Funding for Lending scheme easing funding conditions but warned that further momentum would also depend on an improving economy.
You've got to hand it to them. But the following snippet is what stood out...
Nationwide also noted a trend towards borrowers lengthening the term of their mortgage, with 53% of mortgages over 25 years, up from 40% in 2007.
So not only are we facing an unprecedented housing shortgage, an entrenched ultra-low base rate (market and buyers assuming a new norm), we have continued pump-priming and lengthening of mortgage terms. Factor in duel income buyers now being the norm, house prices are arguably undervalued.
Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam
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Comments
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Why don't you move out of your sister's spare room and buy one then?0
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Turnbull2000 wrote: »
So not only are we facing an unprecedented housing shortgage, an entrenched ultra-low base rate (market and buyers assuming a new norm), we have continued pump-priming and lengthening of mortgage terms. Factor in duel income buyers now being the norm, house prices are arguably undervalued.
Is this a good sign?????
Because that to me highlights an affordability issue.0 -
shortchanged wrote: »Is this a good sign?????
Because that to me highlights an affordability issue.
It's helping tackle the affordability issue.Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
shortchanged wrote: »Is this a good sign?????
Yawn predictable as ever,you and Devon should get holed up in a fall ut shelter.0 -
Turnbull2000 wrote: »It's helping tackle the affordability issue.
So does that mean housing is still overpriced then?0 -
shortchanged wrote: »Is this a good sign?????
Because that to me highlights an affordability issue.
Depends why people are lengthening the terms.
In my case (recently extended to retirement date) it's because mortgage rates are so low I can get a better return by diverting capital repayments to savings. If/ when the situation reverses I'll transfer the savings to the mortgage.
I'm sure plenty are extending just to reduce monthly outgoings but it's not the whole story.0 -
Houses are the most affordable they have ever been in decades, rents are rocketing. Yeah baby yeah baby yeah0
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moneyinmypocket wrote: »Houses are the most affordable they have ever been in decades, rents are rocketing. Yeah baby yeah baby yeah
Cue loads of hip thrusting and fist pumping.0 -
shortchanged wrote: »So does that mean housing is still overpriced then?
I guess that's a matter of opinion. Some still believe they should be 3.5x single income - which is absurd.Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Turnbull2000 wrote: »I guess that's a matter of opinion. Some still believe they should be 3.5x single income - which is absurd.
Any reason why that is absurd?0
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