Sellers acting with more savvy?

nelly_2

Doesnt mean !!!!!! all if they sell or not

take avearage street-

monday- every house worth 1 million

Tuesday- for sale number 1 Average st goes on market at 1 million quid

wednesday- every other house goes on sale for 100 grand

thursday- Number one pull out of selling cos they dont like local prices

Friday - They realise that 'not selling' DOESNT mean its still worth 1 million at all, its worth what similar houses are priced at NO MATTER what they do, think, want, and thats the LAW!

WTF?_2

Phirefly wrote: »

Thankyou for a more intelligent reply.

I agree with you absolutely. I'm not dismissing recent events, I'm simply observing that in real terms recent events currently are not tangibly affecting the ordinary (urgh, for want of a better term) people I know.

Well what's changed is that interest rates have risen over two years, and people are starting to come off their 'super low rate' 2-year teaser period, and facing full SVR which can be anything from 7.5% upwards.

And there's the much reported 'credit crunch' which will make it extremely difficult for people to remortgage and for new buyers to even get a mortgage in the first place.

Then there's the fact that prices have fallen for three months in a row - even by over-optimistic building society estimations. Many people made the calculation to buy based on ever increasing prices.

So, anyone who paid silly prices around 2 years ago and has borrowed a very large multiple of their income is really facing a world of pain now. And that's even if the economy stays healthy and they don't need to worry about inflation (which despite government figures is rapidly rising) and the security of their job.

Generali

EdInvestor wrote: »

Sure, but the LIBOR spike may just be year-end related - after the books are balanced it could settle much lower.The point IMHO is that the Bank has demonstrated that it sees the need for balancing action.This wasn't previously clear which was worrying (especially given the mishandling of NRK).

I think that the LIBOR spike is partly year end related but at the same time I don't see the premium over base dropping back to 'normal' levels. The risk premium being demanded is too high for that to happen and that will persist until the banks can proove their solvency by writing off losses and subsequently being able to come up with the cash for a dividend.

EdInvestor wrote: »

Obviously there's still a way to go, but encouranging to see a second appearnce by the oilies and the Asians today to recapitalise UBS, after the earlier Citibank move.They seem to have realised that a major recession in the US and Europe is not in their interest and that an opportunity exists to get some valuable assets cheaply plus gather some valuable 'helping out' brownie points for later

The secondary effects of this have barely started to surface. Ok, NRK's gone and Kensington's on the ropes but the fact is that if banks want to hoard cash (and in particular want to be pretty sure of getting it back) then they're going to be very careful of lending it where there's a fair chance they won't get it back.

If I was running a mortgage book now I'd be looking to offer really good rates for the best customers (say <75% LTV, lending no more than 2.5-3x income, spotless record only) and the rest can go to the competition for all I care or pay a realistic price for my risk on the SVR. If risky people go elsewhere, it leaves more cash for me to buy out a competitor or two if things get really nasty. That it's going to get nasty must be the suspicion of the banks or they'd be happy to lend to each other!

You're right that a big recession is not in the interests of oil exporters of course. Do you know what their reaction was in 1973-4 during the credit crunch? (Genuine question, not trying to make a point).

EdInvestor wrote: »

IMHO if there's a problem it will tend be confined to the inner city apartments in the provinces, so primarily a local issue.

If you strip out the inner city and the provinces, you don't leave much except suburban London! Perhaps you could clarify.

neverdespairgirl

Phirefly wrote: »

Thankyou for a more intelligent reply.

I agree with you absolutely. I'm not dismissing recent events, I'm simply observing that in real terms recent events currently are not tangibly affecting the ordinary (urgh, for want of a better term) people I know.

I'm no expert, but I think the credit crunch will come to affect a lot of people over the next few months.

For example, although the Bank of England dropped official interest rates, I understand the inter-bank lending rate hasn't dropped at all. So banks may well be wary of lending to people with less than perfect credit histories. As people come off fixed rate mortgage, they may well find their new rate is higher, significantly so.

Generali

neverdespairgirl wrote: »

I'm no expert, but I think the credit crunch will come to affect a lot of people over the next few months.

For example, although the Bank of England dropped official interest rates, I understand the inter-bank lending rate hasn't dropped at all. So banks may well be wary of lending to people with less than perfect credit histories. As people come off fixed rate mortgage, they may well find their new rate is higher, significantly so.

The effect of the troubles in the interbank money markets (and the near impossibility for banks to sell mortgages on to investors) will be to reduce the amount of money available for people to borrow.

As the amount of money available to be loaned drops, banks will be able to be pickier about who they lend to. Why sell a mortgage on a good rate to someone that's a high risk when you can sell it to a lower risk and make more money?

Anyone remember when you used to have to have a good relationship with a financial institution and prove that you were spending less than your income by saving regularly before you got a mortgage? Who knows, those times may be on the way back!

wii_man1

they can fiddle about with intrest rates as much as they like it will make no difference what so ever.

1: libor rate for interbank lending is higher that it has ever been.
2: the rate cuts will not be passed onto borrowers
3: savings rates will stay faily high as well as the banks want you to keep your cash with them.

4: anyone who is buying now needs drug testing :rotfl:

trulysaintly

In the words of Mr Clive Dunn......

DON'T PANIC !!!!

The simple matter is, everything is relative.

If you were looking to buy three years ago, you paid less then than you would now.

The ratio of your mortgage to the property value should have improved since then - if you are considering moving home, do your figures upfront and work out how much you need to sell for in order to move.

If you get offered less than you need - then don't move - its simple!!!!

Don't believe the hype - prices will not plummet like a stone. We have this type of pricing plateau every five years or so.

If you are looking for your first mortgage, then be extra extra careful at this stage - do not overstretch yourself as you will pay later.

Find yourself a good mortgage broker who finds the right deal for you, and when you see them, make sure you see the application form before it goes to the lender.

The issues I've come across so far this year have been related to deals arranged by other less scrupulous brokers :eek: tow or three years ago.

Take care out there and keep the faith.....in two years you'll be wondering what the fuss was about

trulysaintly

!!!!!!? wrote: »

Well what's changed is that interest rates have risen over two years, and people are starting to come off their 'super low rate' 2-year teaser period, and facing full SVR which can be anything from 7.5% upwards.

And there's the much reported 'credit crunch' which will make it extremely difficult for people to remortgage and for new buyers to even get a mortgage in the first place.

Then there's the fact that prices have fallen for three months in a row - even by over-optimistic building society estimations. Many people made the calculation to buy based on ever increasing prices.

So, anyone who paid silly prices around 2 years ago and has borrowed a very large multiple of their income is really facing a world of pain now. And that's even if the economy stays healthy and they don't need to worry about inflation (which despite government figures is rapidly rising) and the security of their job.

OK there is a solution to most of this - if you know you're current mortgage rate is coming to an end - contact a mortgage broker THREE MONTHS before it ends.

This way, the broker can review your options accordingly, and if your payments are likely to increase, you can plan for the increased outgoings.

Secondly, although the credit crunch is felt throughout the mortgage market, the biggest area being hit is Sub-Prime, so if you have a self cert, or arrears history that puts you in this market, then YES you may have problems remortgaging at a competitive rate.

It is however wrong to assume that EVERYONE (ie those with no credit problems in the past) are being eliminated by lenders at present. It is not the case.

DON'T PANIC !!!

WTF?_2

trulysaintly wrote: »

In the words of Mr Clive Dunn......

DON'T PANIC !!!!

The simple matter is, everything is relative.

If you were looking to buy three years ago, you paid less then than you would now.

The ratio of your mortgage to the property value should have improved since then - if you are considering moving home, do your figures upfront and work out how much you need to sell for in order to move.

If you get offered less than you need - then don't move - its simple!!!!

Don't believe the hype - prices will not plummet like a stone. We have this type of pricing plateau every five years or so.

If you are looking for your first mortgage, then be extra extra careful at this stage - do not overstretch yourself as you will pay later.

Find yourself a good mortgage broker who finds the right deal for you, and when you see them, make sure you see the application form before it goes to the lender.

The issues I've come across so far this year have been related to deals arranged by other less scrupulous brokers :eek: tow or three years ago.

Take care out there and keep the faith.....in two years you'll be wondering what the fuss was about

alternatively:

http://news.sky.com/skynews/xml/article/0,,91070-1197557657,00.html

Great news for would-be buyers everywhere. The latest housing market data reveals house prices are falling in all regions across the country. Even London, which experienced the strongest house price growth over the summer, has fallen into decline.
That's according to the newly published UK housing market survey from the Royal Institution of Chartered Surveyors (RICS) which reveals sentiment has deteriorated yet again. The results first turned negative in August and have declined further every month since. The index now shows 41% more surveyors reporting falling rather than rising house prices in the three months to November.
These are the most pessimistic results since May 2005 as the trend of falling house prices shows little sign of abating. Surveyors are gloomy on their expectations for prices in all parts of the country going forward, with confidence falling to the lowest level since the survey began.
What's more, the level of newly agreed sales is dropping at the fastest pace since April 1999. New enquiries from buyers have also taken a heavy fall while new instructions to sell property dropped for the sixth month running.

Always good to be informed before making a decision on spending (or rather, taking on debt) hundreds of thousands of pounds.

As things stand, the longer you hold off buying, the cheaper your house is likely to be, the less debt you'll have to carry.

boinging_2

trulysaintly wrote: »

In the words of Mr Clive Dunn......

DON'T PANIC !!!!

The simple matter is, everything is relative.

If you were looking to buy three years ago, you paid less then than you would now.


Take care out there and keep the faith.....in two years you'll be wondering what the fuss was about

Thank god you put in your signature "Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice".

In two years time, if you bought a house today you would be wondering why you had listened to people saying it's only a blip.