Today's Bear food

chucknorris

p1212 wrote: »

Sorry, but this is exactly why property prices are this high, trying to keep up with the joneses from interest only debt...

... and when prices went free fall in 2008 due to this kind of irresponsible lending, government and central bank actually saved you together with the banking system. In a free market prices would've fallen much more then lender would've called in the missing equity rendering most of the interest only joneses + some banks bust, then we would have normal prices today.

Now, I don't know your situation and plans, but the funny thing is most people I know haven't used this low rate + "free money to everyone on debt" period to actually pay off their mortgages, no, ohh no...

They rather withdrawn equity, spent it on high lifestyle, bought another house etc... keeping themselves leveraged instead of paying off a more moderate house and get on with life without debt. Now if they don't ever repay their debt and keep themselves for example around 50% equity through all of their life, it is highly likely that they will lose everything at some point.

You are making incorrect assumptions, first of all, Chuck Norris can not only keep up with the Joneses, the Joneses try to keep up with him. Also the mortgages were interest only because they were originally covered by endowments, and we are not 'leveraged', the £680k mortgage is only about 12% LTV. Additionally we have non property assets worth well in excess the value of our mortgages, so we could pay the mortgages off now if we wanted to. But our average mortgage rate is less than 0.75%, and we are earning over 3.5% from dividend income (a significant proportion of that is tax free), so why on earth would we want to pay off the mortgages? As it happens though, we are about to sell our most expensive property, although that one isn't actually mortgaged anyway, so it will not reduce our mortgage amount, but that doesn't matter, as we could pay off our mortgages any time that we wanted to.

cells

AFF8879 wrote: »

I think this is a point that needs to be made a lot more, it's so frustrating reading all these tabloid headlines about "Britain's Housing Crisis" when in vast majority of the country home ownership is affordable and in many other areas downright cheap...

People are migrating to an urban lifestyle, and want to live in / near cities. Therefore prices rise in these areas. But go out to the sticks and they're practically giving houses away. Maybe a slight exaggeration but more people want to be in cities, myself included, and are prepared to pay a premium to get it.

I see what you mean but its not quite 100% accurate. I would say people want to live in London not in cities in general. The UK #2 city Birmingham is cheap and so are most the others.

London just attracts money. Its the case that if you have many millions do you buy a £120k car or do you buy a new ford for £12k? So do the rich go and buy a £2m home in inner London to be next to other rich people or do they go buy a £0.2m home in brum?

In London the high prices acts as a forcing function. If London prices were about what they are in Birmingham then Londons population would be growing at 3 million a decade instead of 1 million.

So those who want London to be just 20% more expensive than Birmingham need to figure out a way to expand London at 300,000 people a year

p1212

chucknorris wrote: »

You are making incorrect assumptions, first of all, Chuck Norris can not only keep up with the Joneses, the Joneses try to keep up with him. Also the mortgages were interest only because they were originally covered by endowments, and we are not 'leveraged', the £680k mortgage is only about 12% LTV. Additionally we have non property assets worth well in excess the value of our mortgages, so we could pay the mortgages off now if we wanted to. But our average mortgage rate is less than 0.75%, and we are earning over 3.5% from dividend income (a significant proportion of that is tax free), so why on earth would we want to pay off the mortgages? As it happens though, we are about to sell our most expensive property, although that one isn't actually mortgaged anyway, so it will not reduce our mortgage amount, but that doesn't matter, as we could pay off our mortgages any time that we wanted to.

As I said I don't know your situation, so I was not talking about you, but other leveraged people with huge mortgages. Maybe as a uni lecturer you could try to actually understand a simple sentence.

Anyway based on this you are a multimillionaire, good for you, but I am not really sure what you really want to prove with your situation as you are clearly very-very far from the average.

Yes, there are a few people being multimillionaires and they will never have any problem regardless of house prices. Then what? What is your point? Should I be happy that government helps the people who clearly doesn't need any help? Or what?

chucknorris

p1212 wrote: »

As I said I don't know your situation, so I was not talking about you, but other leveraged people with huge mortgages. Maybe as a uni lecturer you could try to actually understand a simple sentence.

Anyway based on this you are a multimillionaire, good for you, but I am not really sure what you really want to prove with your situation as you are clearly very-very far from the average.

Yes, there are a few people being multimillionaires and they will never have any problem regardless of house prices. Then what? What is your point? Should I be happy that government helps the people who clearly doesn't need any help? Or what?

But you were responding to me, so don't try and hide behind that 'I don't know your situation' comment, obviously I was going to point out that I don't fit the 'stereo type' that you described. I wasn't trying to make any point, I was simply responding to your reply to me.

p1212

chucknorris wrote: »

But you were responding to me, so don't try and hide behind that 'I don't know your situation' comment, obviously I was going to point out that I don't fit the 'stereo type' that you described. I wasn't trying to make any point, I was simply responding to your reply to me.

You might need a few more PHDs to understand what I wrote:
"Now, I don't know your situation and plans, but the funny thing is most people"

Let me explain this above to you, that means as you haven't given sufficient information about your situation, so my writing is not about you, but the most people.

Your situation now is totally irrelevant. Yes, you bought a big house on interest only debt decades ago, when your LTV was not actually 12% but much more and then you got lucky instead of going broke, you enjoyed decades of debt expansion + rising prices and capital gains and now you are wealthy and you happy about yourself. I know others who did exactly the same, fantastic, but what is your point?

Should the government help the millionaires even further, or what?

chucknorris

p1212 wrote: »

YYes, you bought a big house on interest only debt decades ago, when your LTV was not actually 12% but much more and then you got lucky instead of going broke, you enjoyed decades of debt expansion + rising prices and capital gains and now you are wealthy and you happy about yourself. I know others who did exactly the same, fantastic, but what is your point?

Should the government help the millionaires even further, or what?

I've already explained that my interest only mortgages were with endowment policies, there are more ways to repay a mortgage than having a repayment mortgage. I didn't buy a large house decades ago, I bought several smaller properties, so once again you are making incorrect assumptions. I have always lived in the cheaper half (or average value) of my properties to mitigate my risk.

I actually bought my first house with cash, I didn't get a mortgage until I traded up a few years later. I've already said I am not trying to make a point (other than my original one which was that people do care out interest rates), I am merely responding to you post to me, and correcting your assumptions.

p1212

chucknorris wrote: »

I've already explained that my interest only mortgages were with endowment policies, there are more ways to repay a mortgage than having a repayment mortgage. I didn't buy a large house decades ago, I bought several smaller properties, so once again you are making incorrect assumptions. I have always lived in the cheaper half (or average value) of my properties to mitigate my risk.

I actually bought my first house with cash, I didn't get a mortgage until I traded up a few years later. I've already said I am not trying to make a point (other than my original one which was that people do care out interest rates), I am merely responding to you post to me, and correcting your assumptions.

What you do is actually setting up little traps, telling some partial information, so people obviously think of something based on those, but you already know those assumptions will be false, then you make yourself happy saying these assumptions are false. Not telling the truth, telling the partial truth is actually lying.

So just give yourself a pat on the shoulders, you've now corrected all assumptions, apart from the most important ones, that you bought at low and enjoyed all the capital gains + help from central bank. Are these incorrect assumptions too?

chucknorris

p1212 wrote: »

What you do is actually setting up little traps, telling some partial information, so people obviously think of something based on those, but you already know those assumptions will be false, then you make yourself happy saying these assumptions are false. Not telling the truth, telling the partial truth is actually lying.

So just give yourself a pat on the shoulders, you've now corrected all assumptions, apart from the most important ones, that you bought at low and enjoyed all the capital gains + help from central bank. Are these incorrect assumptions too?

What are you talking about I have always stated the truth, if you had read my posts you would have known, what partial truths are you talking about?

One of the main reasons that I moved from Newcastle to London because London properties were particularly (comparatively) cheap, there wasn't any luck about that, it was a conscious decision. I was already wealthy before the base rate was reduced to 0.5%, that was merely the icing on the cake.

You come across as a very bitter person.

ukcarper

p1212 wrote: »

As I said I don't know your situation, so I was not talking about you, but other leveraged people with huge mortgages. Maybe as a uni lecturer you could try to actually understand a simple sentence.

Anyway based on this you are a multimillionaire, good for you, but I am not really sure what you really want to prove with your situation as you are clearly very-very far from the average.

Yes, there are a few people being multimillionaires and they will never have any problem regardless of house prices. Then what? What is your point? Should I be happy that government helps the people who clearly doesn't need any help? Or what?

But you imply that the majority of people are over leveraged when in fact it's a small minority.

wotsthat

p1212 wrote: »

What you do is actually setting up little traps, telling some partial information, so people obviously think of something based on those, but you already know those assumptions will be false, then you make yourself happy saying these assumptions are false. Not telling the truth, telling the partial truth is actually lying.

So just give yourself a pat on the shoulders, you've now corrected all assumptions, apart from the most important ones, that you bought at low and enjoyed all the capital gains + help from central bank. Are these incorrect assumptions too?

In the interests of truth what's your username on HPC?

It's obvious that's your normal home. The signs are there - petty jealousy, assumptions that being leveraged to the hilt is normal and everyone else got lucky.