HTB interest free period is now up

westernpromise

AG47 wrote: »

Help to bubble sounded great, and it was great for the first 5 years helping the bubble, but now the 5ys is up, the bubble is looking too if and easy to pop

You were saying that 5 years ago since which time prices have inflated 50% in London.

So what if there's a cyclical correction now? Anyone who bought 5 years ago has paid off 15% of what they borrowed, so they're still ahead.

Graham_Devon

westernpromise wrote: »

You were saying that 5 years ago since which time prices have inflated 50% in London.

So what if there's a cyclical correction now? Anyone who bought 5 years ago has paid off 15% of what they borrowed, so they're still ahead.

Again, not true.

The average length of a HTB mortgage is over 30 years (was on some stats but can't find them now). Which means they have paid down around 9-10% on 75% of the value of the house.

Thrugelmir

Graham_Devon wrote: »

Again, not true.

The average length of a HTB mortgage is over 30 years (was on some stats but can't find them now). Which means they have paid down around 9-10% on 75% of the value of the house.

At 3% interest it's around 11% on a 30 year term.

Graham_Devon

Thrugelmir wrote: »

At 3% interest it's around 11% on a 30 year term.

Most HTB mortgages are around 3.5% - 4%

AG47

Graham_Devon wrote: »

Most HTB mortgages are around 3.5% - 4%

That could double

westernpromise

Or halve. I fixed 4 years ago at 3.89% when base rates were at 0.5%. If I fixed again today when they're still at 0.5% it would be at 1.88%.

You just want HTBers to lose because you're envious of them and you didn't yourself dare to take the risk they did.

Never mind, I'm sure bitcoin will make you rich.

AG47

There is no way rates could halve from here

Malthusian

Another infallible prediction like "the base rate can't go any lower than 0.5%"?

If they can fall by 2.01% they can fall by 0.94%. Whether they do, or are even likely to, is neither here nor there as your claim is that it's impossible; it clearly isn't.

westernpromise

Bear in mind a lender's business is to lend money. It is thus entirely possible that we could see rises in base rates accompanied by falls in mortgage rates, as lenders discount to get people to take out loans.

If the product's not shifting, you cut the price, which applies to mortgage products like any other.

This time 4 years ago 3.89% was a tempting rate. Since then transactions have fallen, and lo! I can now remortgage at less than half the previous rate! Quelle surprise - not.

Electrum

Graham_Devon wrote: »

The point being you can't just switch mortgages on a HTB purchase.

Plenty on this around the internet and on the financial times etc detailing the struggle people will have the re-mortgage.

What you state all sounds fine and dandy - but unfortunately isn't the reality of the situation.

Yep, and the situation is only getting worse.

Maybe there will need to be a grace period or something to prevent massive repossessions