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Debate House Prices
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UK Households wealthier than ever before
Comments
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Graham_Devon wrote: »
Only if the asset is debt free can ou access the wealth.
Lets suppose I overpay my mortgage by £500 per month for a couple of years.
Not only have I reduced my mortgage debt by £12,000, but I have also reduced the interest payable, hence further increased the repayment part of the mortgage.
Could I not then choose to access this equity at remortgage?
I am assuming you are agreeing therefore you CAN access the wealth without the asset being debt free.:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
IveSeenTheLight wrote: »Could I not then choose to access this equity at remortgage?
I am assuming you are agreeing therefore you CAN access the wealth without the asset being debt free.
What do you have to do to re-mortgage?
You have to realise your debt.
If (and there are many in this boat at the moment), you can't remortgage becuase you don't meet the terms of realising your debt, you can't remortgage.
The net wealth on your house is completely inaccessible unless you sell your house (which will also involve realising your debt).
As for accessing your wealth, you haven't accessed it, you've merely repackaged your debt. You still can't use it to buy horseburgers or an ipad. You've just saved some cash on your outgoings (interest).
Do you dispute this?
That was my point. Though I'm begining to wish I hadn't bothered. Housing wealth is great, but unless you plan to sell up and live in a carboard box, theres not much you can do with it. I understand the arguments about downsizing etc etc, but I too understand the argument that downsizing is only practical for the few.
Edit: and if you can't quite see the irony in the fact that you had to use an example where you overpay your debt to access your wealth to counteract my point stating you have to realise your debt to access any wealth, then we are beyond hope here.0 -
IveSeenTheLight wrote: »Lets suppose I overpay my mortgage by £500 per month for a couple of years.
Not only have I reduced my mortgage debt by £12,000, but I have also reduced the interest payable, hence further increased the repayment part of the mortgage.
Could I not then choose to access this equity at remortgage?
I am assuming you are agreeing therefore you CAN access the wealth without the asset being debt free.
Typical debt-junky nonsense.
In reality you just want HPI to do the work and not have to overpay.
Then you can access "all that lovely equity" by going into more debt.
genius.0 -
Asset wealthy, but cash poor
Also known as fur coat and no knickers:D
I've over paid, over the last 5 yrs, and since Aug last year have paid an extra 13K on top of that. I think this has definitely had an effect on our wealth compared to debt.Mortgage: Aug 12 £114,984.74 - Jun 14 £94000.00 = Total Payments £20984.74
Albert Einstein - “Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.”0 -
exarmydreamer wrote: »Also known as fur coat and no knickers:D
I've over paid, over the last 5 yrs, and since Aug last year have paid an extra 13K on top of that. I think this has definitely had an effect on our wealth compared to debt.
Has your disposable income improved, on a like for like basis?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
exarmydreamer wrote: »Also known as fur coat and no knickers:D
I've over paid, over the last 5 yrs, and since Aug last year have paid an extra 13K on top of that. I think this has definitely had an effect on our wealth compared to debt.
Well, yes, that would have an effect on your wealth. You are, afterall, paying off a debt. Each payment reduces your debt and increase your wealth.
Nothing wrong with that.
You haven't "accessed" this wealth though. Simply paid down debt.
The issue comes when it's explained as accessing wealth. By this theory, everyone doing a balance transfer to a lower interest rate card is "accessing their wealth". It's a bloody nonsense! Only stated by those wanting HPI, usually seeing (and holding) homes as an investment...and this is key, as accessing wealth to increase debt for investment purposes works. But it doesn't work for normal homeowners who use their home as just that. Seemingly some are confused between the difference.0 -
Graham_Devon wrote: »It's just paper wealth.
Almost all wealth is "paper wealth".
And whether it is held in stocks, bonds, pensions, housing equity, ISA's, in fact pretty much anything other than cash under your mattress, there will be some limitations to access.
That doesn't however make it any less 'wealth' than any other type of 'wealth'.A lot of it with outstanding debt attached.
We really have to talk about your reading comprehension skills Graham.....
The increase is in "net" wealth.;)“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 -
HAMISH_MCTAVISH wrote: »Almost all wealth is "paper wealth".
And whether it is held in stocks, bonds, pensions, housing equity, ISA's, in fact pretty much anything other than cash under your mattress, there will be some limitations to access.
Come on now Hamish, are you just baiting here?
I can't honestly believe you are comparing the limitations of an ISA or stocks against the limitations of housing equity.
Comparing pensions is a complete nonsense so not even worth discussing.
It's one thing having to wait a couple of days to sell stocks and access your wealth. It's quite another to forgo the roof over your head to access your wealth.
I take it you have little else to say if you are coming up with this.
I'll ask you, as ISTL soon logged off. Do you disagree that if you have a mortgage you have to realise your debt before you access your wealth?0 -
Graham_Devon wrote: »Comparing pensions is a complete nonsense so not even worth discussing.
Eh?
Are pension funds not "real wealth" Graham?
The report will be including them. Yet they are more difficult to access for most people than housing equity.It's one thing having to wait a couple of days to sell stocks and access your wealth. It's quite another to forgo the roof over your head to access your wealth.
I take it you have little else to say if you are coming up with this.
You're blatantly muddling again.
You've tried to turn this into a debate about "instantly accessible cash" rather than total net wealth.
No wonder ISTL logged out.:(“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 -
I wonder if the figures include bitcoin wealth?
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