Reducing house offer after months of waiting for completion

Sarah1Mitty2

GDB2222 said:

Scotbot said:

I expected prices to fall once rates rose. Based on May land registry sales data the annual increase is 21% where I live. So they have to fall 20% before I lose a  single penny. They are still selling as well, almost every for sale sign has sold on it. It is not sustainable and I expect prices will fall but seems the stress testing is working round here for now(West Mids)

Yes, the stress testing has worked pretty well so far. 

Does anyone know how the stress testing works now, given that interest rates are 5-6% on a two year mortgage? Do the banks add a few % on to that rate?  That could make it difficult for new borrowers to get much of a loan?

It is way too early to tell that, rates have only just hit a critical point.

MultiFuelBurner

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

Sarah1Mitty2

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

  Not really, it just says that the bank bought that particular tranche of money at a lower rate and sub 5% allows them to still make a profit, and importantly lure in customers with the low rate meaning probable higher rates later when the fix ends (similar, in reverse, to how gas companies buy supplies to last 12 months or so in advance and can still be charging you the higher rate when the global price of gas/oil is falling) but at 60% LTV this deal won`t be much use to people struggling to buy, the only answer for them is prices coming down.

CSI_Yorkshire

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

GDB2222

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

The OP asked for some practical advice. What do you think?

Sarah1Mitty2

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

People who took the advice of "not to expect higher rates" recently in some cases are in a very real financial mess? SKY news is all over it this morning actually.

CSI_Yorkshire

GDB2222 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

The OP asked for some practical advice. What do you think?

The OP has had my advice several times earlier on the thread.

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

People who took the advice of "not to expect higher rates" recently in some cases are in a very real financial mess? SKY news is all over it this morning actually.

A change in the last six months in the rates on offer does not represent what will be available at the end of a 5-year fix starting today.  Saying that it will "probably" be higher in mid-2028 is ludicrous.

GDB2222

CSI_Yorkshire said:

GDB2222 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

The OP asked for some practical advice. What do you think?

The OP has had my advice several times earlier on the thread.

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

People who took the advice of "not to expect higher rates" recently in some cases are in a very real financial mess? SKY news is all over it this morning actually.

A change in the last six months in the rates on offer does not represent what will be available at the end of a 5-year fix starting today.  Saying that it will "probably" be higher in mid-2028 is ludicrous.

You could just have a look at the BOE yield curves, which reflect aggregate opinions of all the highly paid bankers. It’s likely to be a better estimate than anything on the MSE forum.

simon_or

Ultimately, you don't owe the vendor anything until exchange and vice versa. That's just an unfortunate byproduct of the way the house buying system works in England. More than a third of offers accepted fall through for one reason or the other. I expect it's even higher than usual now given the mortgage turmoil. Plus a vendor can go to market without any upfront costs or skin in the game so there are as many time-wasting sellers out there as there are time-wasting buyers.

As long as you are clear eyed about the potential outcomes (one of which might be that the vendor gets miffed and pulls out), there's absolutely nothing wrong with considering renegotiating.

I don't know about your specific area but in the town that I live, lots of properties on the market have reduced their asking prices over the last month, house price indexes (always lagging) are showing steady declines so it might well be the case that the property is 'worth less' than what you offered.

Perhaps even leave this on the back burner and look at other properties at lower price points to guage whether you may have overpaid or consider whether you might be able to stretch to a bigger longer term property on a 5 year fix.

No one can say what will be better financially in a few years time as that depends on things outside your control.

I would never exclude FTBs when selling properties as they make up 50% of the purchase market so it would be financially illiterate to do so. 

As you said, most banks mortgage offers are valid only for 6 months so if it's not moved a jot since April, then there's no harm in rethinking your approach

MobileSaver

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MultiFuelBurner said:

4.79% for a 5 year fix (remortgage) is the best remortgage deal I can see with a quick google and 4.69% for a 5 year fix (purchase) with 60% LTV.

Given the BoE base rate of 5% that shows confidence again that rates will drop out from year 2 or earlier in the 5 year fixes.

   meaning probable higher rates later when the fix ends 

This is the same 'probable' as the 50% price drop?  Just to know whether to never expect that one too.

People who took the advice of "not to expect higher rates" recently in some cases are in a very real financial mess? SKY news is all over it this morning actually.

More scaremongering nonsense, almost all recent mortgages are for fixed rates of at least two years and most are fixed for at least five years. So a tiny number who thought they knew better (sound familiar?) may be paying the price now while the vast majority will be laughing all the way to the bank!