Young unable to buy as rents soar

wotsthat

I'm fixed until late 2018 at 2.99%. I've been with Nationwide for 15 years and never had a problem getting a new 'introductory' rate.

God knows what I'll do when that ends especially now it's been explained that in some circumstances renting can be cheaper than buying.

wotsthat

dryhat wrote: »

Fears for millions of mortgage prisoners trapped by loans taken out during boom years

The Daily Mail in that 2 year old article try to insinuate over 5 million people may be mortgage prisoners which is half the number of people currently holding a mortgage.

It sounded like BS two years ago. Sounds even more unlikely today. Besides the Mail didn't show a ticking time bomb so the story immediately lacks credibility.

IronWolf

Jack_Johnson_the_acorn wrote: »

Lol teaser mortgage rates..... I've just gone from 4.9% 90%LTV fix down to 4%SVR and now down to 3.1% 85%LTV.

Plus if you stay with the same lender and just change deals after the fix ends they don't even question the value of the property they just assume the original purchase price is still valid. So as long as you've paid the mortgage each month you're virtually guaranteed to drop down a LTV bracket every 3 yrs. Never needing to go on a SVR.

I'd guess that Graham 's scenario of cheaper to rent is correct in less than 1% of house purchases.

3-4% is not a teaser rate, look at the ones I quoted they are 1.5% with hefty early repayment charges.

Your last statement is just laughable, maybe it was just a 1 in a 100 chance then that AndyGuils example was way cheaper to rent than buy on a monthly basis? (even though he was trying to show an example of the opposite, maybe you just think hes incompetent)

AndyGuil

Guess it was a fluke I knocked £500 pcm off by buying instead of renting.

Graham_Devon

Jack_Johnson_the_acorn wrote: »

Lol teaser mortgage rates..... I've just gone from 4.9% 90%LTV fix down to 4%SVR and now down to 3.1% 85%LTV.

Yes. That's exactly what was being said. 4% is about normal. So you are laughing out loud, and then agreeing in the same breath.

Andy had worked out his repayments based on a rate UNDER 2%.

kitty_kins

Conrad wrote: »

I had a call this week from a 30 something childless couple that told me they can easily afford a mortgage as they have demonstrated paying £1000 pm in rent, that they are decent earners pulling in about £4k net pm, bemoaning the fact lenders wont assist them because they have NO deposit.


I relayed the same message, no deposit, no mortgage to which they kept repeating how unfair things are.


They spend all their income and are simply not happy to HAVE to save. They kept saying they want a life, they aren't willing to work hard only to have to settle for a less rewarding leisure time.


I explained if they don't learn the saving habit now, they will soon find themselves aged 40+ still renting, still feeling bitter.


Some people somehow will never except the concept of delayed gratification, setting aside the harvest.

This seems just ridiculous to me. We've both been to Uni and have saved even then. That said, both my parents used to work in the bank and my boyfriend's dad worked in finance, so maybe we've just been brainwashed into saving?

I hate saving but I've just put a little away each month - I still keep my lifestyle and now I have a beautiful home too!

My brother has just bought a house (he is 10 years older than me) with his wife - he wishes they'd saved earlier and been able to buy before having kids!

AndyGuil

Graham_Devon wrote: »

Yes. That's exactly what was being said. 4% is about normal. So you are laughing out loud, and then agreeing in the same breath.

Andy had worked out his repayments based on a rate UNDER 2%.

There are loads of fixed rate mortgages less than 4%. You are not stuck to the mortgage you signed up with. Chop and change as you do with electricity/gas, bank accounts etc. It is straight forward, as soon as the fixed period is coming to an end sign up for a new one. You are not going to be looking at 4% mortgage rates unless you are looking at very low deposit mortgages.

Jack_Johnson_the_acorn

IronWolf wrote: »

3-4% is not a teaser rate, look at the ones I quoted they are 1.5% with hefty early repayment charges.

You and Graham can't both be this stupid.

ANSWER THESE QUESTIONS
How much Deposit is needed to get a rate of 1.5%?
Im guessing at least 30%

What % would the property need to decrease in value for the LTV of a fixed rate to be worse than the SVR? and therefore be stuck on said SVR.

Jack_Johnson_the_acorn

AndyGuil wrote: »

There are loads of fixed rate mortgages less than 4%. You are not stuck to the mortgage you signed up with. Chop and change as you do with electricity/gas, bank accounts etc. It is straight forward, as soon as the fixed period is coming to an end sign up for a new one. You are not going to be looking at 4% mortgage rates unless you are looking at very low deposit mortgages.

Exactly this. It's only if prices bomb that people with sub 15% deposits may get lumped onto an svr..... Although as I said earlier, Most banks will complete an execution only change of deals. So no need to even look at the house value, they simply check the LTV is correct based on the last or initial valuation.

aggypanthus

Note that this thread was started by A scot...all this talk of rising rents doesnt apply here, we get £410 for a smart, big 2 bed, £345 for small 1 bed ! The latter has been the same for 5 yrs.