House prices to SURGE beyond peak thanks to Help to Buy

Graham_Devon

HAMISH_MCTAVISH wrote: »

There are only 2 options Graham.

Either the government will meet their responsibility as regulator to fix the broken and dysfunctional lending markets in this country, or they won't.

If they do, the wider economy will recover, unemployment will fall, people will be able to buy and sell houses normally again, labour mobility will increase, and they have a chance at re-election.

If they don't, they'll be out of power for a generation and their opponents will fix the problem, having learned from this government's incompetence and not wanting to meet the same sorry fate.

What a complete and utter load of nonsense.

grizzly1911

HAMISH_MCTAVISH wrote: »

If they don't, they'll be out of power for a generation and their opponents will fix the problem, having learned from this government's incompetence and not wanting to meet the same sorry fate.

They didn't fix it last time, just screwed it up, why should they next time.

HAMISH_MCTAVISH

Graham_Devon wrote: »

What a complete and utter load of nonsense.

You seem to be getting increasingly resentful, bitter, and angry the more time goes by and prices keep rising.

Perhaps you should spend some time away from here and get a hobby?

After all prices will rise for the next decade or more, to levels you'll find unimaginable, and mostly thanks to the housing shortage worsened by the very mortgage famine you support.

ruggedtoast

Amazing.

Young people being priced out of owning a home is considered to be 'good' news.

IveSeenTheLight

ruggedtoast wrote: »

Amazing.

Young people being priced out of owning a home is considered to be 'good' news.

Society needs to learn to budget and have the desire / willpower to achieve what they want.

My son is 4, he is currently into Skylanders and he knows that he has to buy them from the shops.
He gets pocket money: -

• 20% is "taxed" (goes into a savings account for him in the future)
• 20% he has to put into his visible savings.
• The remaining 60% is still not enough so he knows it will take 3 weeks to save up enough to buy a new Skylander and now passes on other things he used to buy (childrens magazines) so he saves up quicker.

If only much more of society had been brought up with this realisation and saving culture.

Of course a better range of mortgage products with higher LTV availability would also help

moneyinmypocket

Just because millions can't afford to buy a home (not that I believe that) doesn't mean this isn't great news for current home owners. House price rises benifit the country.

brit1234

moneyinmypocket wrote: »

Just because millions can't afford to buy a home (not that I believe that) doesn't mean this isn't great news for current home owners. House price rises benifit the country.

How can that be good news as people become trapped on the ladder as the next rung is even further away.

Just think of couples who are now families, their wages have fallen, they need more room but the next rung is 13 times salary.

It does work, everything returns to affordability and a mortgage rates are pushed up prices will be pushed down.

Oh this is a cebr article, their April fool lol :rotfl:

IveSeenTheLight

moneyinmypocket wrote: »

Just because millions can't afford to buy a home (not that I believe that) doesn't mean this isn't great news for current home owners. House price rises benifit the country.

I would say that house price rises benefit the: -

• Government (through stamp duty)
• Estate Agents (and subsequently it's employees)
• Solicitors (and subsequently it's employees)
• Insurance Companies (and subsequently it's employees)
• Surveyors (and subsequently it's employees)
• Lenders (and subsequently it's employees)
• Home Owners (through decrease LTV product availability)
• Downsizers
• Property Investors (also those with shares / pensions with links to property)

This of course would constitute the majority of the country, however it is not good for those: -

• Potential home owners
• Upsizers (although HPI has been proven to accelerate the potential to upsize through increased equity / better LTV opportunities)

The best anyone can do is assess their local markets and ascertain the likely reality that will happen and adjust accordingly.

IveSeenTheLight

Welcome back Brit.
I'm surprised as the monthly indices can't be good reading for you.
Don't you think it's time to update your signature?
It's closer to Sept 2013 than Sept 2012.

anyway, to your post: -

brit1234 wrote: »

How can that be good news as people become trapped on the ladder as the next rung is even further away.

Nominally agreed, however in terms of accessing higher rungs, it has been shown how HPI accelerates the access to the higher rung as opposed to stability / falling prices.

Assume you have a £100k property and wanted a £200k property.
You had a 10% deposit so £90k mortgage. To get the £200k property, you'd need to save an additional £10k to maintain the 90% LTV. (lets keep it simple and ignore solicitor fees / stamp duty for now)

With 50% HPI, your property is now valued at £150k and you have at least £60k equity (60% LTV).
Not only can you access better prodcuts for your existing property, but you have £60k towards the £300k property, meaning you have 20% deposit and access to the range of products in that category.

Agreed, affordability is still key and instead of nominally borrowing against £190k (assuming you have not saved any additional equity) you'd be borrowing a £240k mortgage.
The difference between a £190k mortgage and a £240k mortgage at 5% is £300 per month. which some may find acceptable as opposed to being priced out of the next rung through mortgage product availability

Incidently, as HPI continues, the homeowner than finds better LTV products become available to them, potentially reducing the interest rates applicable.

brit1234 wrote: »

It does work, everything returns to affordability and a mortgage rates are pushed up prices will be pushed down.

Agreed, people need to know that their monthly payments are affordable and are not so much impacted by what the nominal ammount of debt is.

grizzly1911

IveSeenTheLight wrote: »

I would say that house price rises benefit the: -

• Government (through stamp duty)
• Estate Agents (and subsequently it's employees)
• Solicitors (and subsequently it's employees)
• Insurance Companies (and subsequently it's employees)
• Surveyors (and subsequently it's employees)
• Lenders (and subsequently it's employees)
• Home Owners (through decrease LTV product availability)
• Downsizers
• Property Investors (also those with shares / pensions with links to property)

This of course would constitute the majority of the country, however it is not good for those: -

• Potential home owners
• Upsizers (although HPI has been proven to accelerate the potential to upsize through increased equity / better LTV opportunities)

The best anyone can do is assess their local markets and ascertain the likely reality that will happen and adjust accordingly.

All of which does very little to actually help the countyry stay afloat in reality.

Most of the people benefiting are merely parasites whilst the host slowly dies.

What would be really good is if this country could actually develop, manufacture and sell to overseas buyers something that adds value to society.

Ramping a money go round based on debt isn't productive if their is no way of repaying it.