Really depressed by the news about Help to Buy...

HAMISH_MCTAVISH

Something_Witty wrote: »

Well Hamish, I concede that you might be right that I do begrudge more people having access to mortgages, mainly for selfish reasons admittedly,

Well at least you admit it.

That's a good start.

but also because I believe in personal responsibility and working for your rewards. Strangely enough these are principles the current government profess to share, just before they prepare to royally shaft the FTBs who have done the right thing, worked hard and scrimped and saved for years. .

But you have to understand, the current situation of severe mortgage rationing, and a million plus people forced to rent and enrich their landlords instead of themselves over the last 5 years because of it, is simply not normal.

95% mortgages have been common and widely available for the last 50 years at least. I was offered one in 1990, my parents were offered one in 1967, and 100% mortgages were available at least as far back as the early 1980's.

The earliest report of a 95% mortgage I have seen was from the late 1800's.

The widespread availability of 95% mortgages is absolutely vital to a healthy and functioning housing market.

And the mortgage rationing of the last 5 years has seen house building fall to 100 year lows. After all, builders won't build what they can't sell.

So offering more mortgages will lead to more houses being built, and enable more people to buy, even when prices do rise.

Yes, this will be bad news for the crashaholics, and those hoping to "snap up a bargain" due to someone else's misfortune, but I can't say I'll shed too many tears over that.....;)

mail2z

In your position you should be fine when you are planning on buying towards next year end the dust should have settled with respect to chaos caused by the rush of new buyers to the market now, there will be further rush towards the end of the 3 year period when it will be reviewed.

MorMac

1865ST wrote: »

I I thought the tories are all about helping people who save and work hard?

:rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl:

So they'd have you believe, but there are plenty of people who work hard and earn very little. Equally there are some who do very little but live very well on inherited wealth. The former are castigated and the latter lauded by this lot!

I'm OK because I'm downsizing, but I fear for my children's future. This next lot of house price rises means it's going to be a lot harder for them to get out of paying extortionate rents. Once student loans have been privatised, all those promises made about student debt will be broken. For starters, the (retrospective) rise in interest rates for their loans will be mean it's going to be hard for them to be free of debt (I don't believe the debt will be written off after so many years once privatised). Even with Maths and Physics degrees they're going to struggle.

I too find it very depressing.

1865ST

Something_Witty wrote: »

Well Hamish, I concede that you might be right that I do begrudge more people having access to mortgages, mainly for selfish reasons admittedly, but also because I believe in personal responsibility and working for your rewards. Strangely enough these are principles the current government profess to share, just before they prepare to royally shaft the FTBs who have done the right thing, worked hard and scrimped and saved for years. Competition in the housing market is undoubtedly 'a good thing', but if there are not enough houses being built yet many more people in a position to buy, the future is going to be very tough indeed for a lot of people.

This is how I feel exactly!

HAMISH_MCTAVISH....if this scheme does cause a housing bubble resulting in people buying houses they can only just afford and interest rates rise in 3-5 years time meaning many thousands of people lose their houses, surely they'll just end up renting again. big waste of time?

HAMISH_MCTAVISH

1865ST wrote: »

This is how I feel exactly!

So you support fewer people being able to buy, and a million plus people being forced to enrich landlords instead?

:eek:

HAMISH_MCTAVISH....if this scheme does cause a housing bubble resulting in people buying houses they can only just afford and interest rates rise in 3-5 years time meaning many thousands of people lose their houses, surely they'll just end up renting again. big waste of time?

Throughout the last 3 housing cycles, including all the booms and busts, less than 1% of people got repossessed. (source: DCLG English Housing Survey)

Surely it's better for the 99% to win, even if the 1% have to lose?

Rather than the situation of the last few years where the majority couldn't buy thanks to mortgage rationing.....

1865ST

MorMac wrote: »

:rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl:

So they'd have you believe, but there are plenty of people who work hard and earn very little. Equally there are some who do very little but live very well on inherited wealth. The former are castigated and the latter lauded by this lot!

.

I was laughing/crying when I wrote that

It's all too unpredictable, that's the worst thing

1865ST

HAMISH_MCTAVISH wrote: »

So you support fewer people being able to buy, and a million plus people being forced to enrich landlords instead?

:eek:

No not at all! I just don't like the idea of people having to enslave themselves for life to buy a rabbit hutch!

HAMISH_MCTAVISH wrote: »

Throughout the last 3 housing cycles, including all the booms and busts, less than 1% of people got repossessed. (source: DCLG English Housing Survey)

Surely it's better for the 99% to win, even if the 1% have to lose?

Rather than the situation of the last few years where the majority couldn't buy thanks to mortgage rationing.....

I haven't applied for a mortgage personally so I've no idea how difficult it is to obtain one! i know 3 people who have applied for a mortgage in the past year...2 were successful the other who is terrible with money was not.

ILW

Would it not have been easier to get a few of the banks which are state owned to offer 95% mortgages, but then price the additional risk into the IR charged?

HAMISH_MCTAVISH

1865ST wrote: »

No not at all! I just don't like the idea of people having to enslave themselves for life to buy a rabbit hutch!

Nobody has to do that.

If you want to, there's nothing stopping you from renting for life, and buying several rabbit hutches for your landlord instead.;)

I haven't applied for a mortgage personally so I've no idea how difficult it is to obtain one!.

It has been very difficult at the historically normal, prudent, and sensible 90% to 95% level. With up to 9 out of 10 applications being rejected, or offered only at much higher rates or LTV's.

As the banks have had to shrink the pool of borrowers to match the much smaller pool of funding available.

Mortgage rationing, plain and simple.

However the current schemes are helping to repair the broken mortgager market and restore functionality.

So that is now ending.

HAMISH_MCTAVISH

ILW wrote: »

Would it not have been easier to get a few of the banks which are state owned to offer 95% mortgages, but then price the additional risk into the IR charged?

Probably.

But that would presumably be against competition regulations.

This is the next best thing, involving a paid for risk premium, to guarantee that section of the loan between 80% and 95%.

Chances are, the state will make a profit from it as well.