Isn't anybody tired of hearing the same old

setmefree2

Nenen wrote: »

setmefree2 you have since edited your post and omitted to say that in your reply to me! That's just not cricket!

Ahh caught! _pale_I did change it before your post though....:p Actually, I'm not even sure the £20k is correct as on a repayment mortgage the capital would be dropping, and therefore the interest - think this might be approx £18k. I've put out a msg to fellow MSEers to help me work out the figure on a reapyment mortgage....reverse compound interest..beyond me. I was just trying to make a point about the cost of a mortgage being linked to interest rates and payment terms and not just what you pay in the market.....sorry:rolleyes:

To recap:-
For every 1% interest rise on a mortgage of just £100k over 25 years you will pay £25k extra on interest only mortgage and approx £18k on a repayment.

At the following rates of interest this is what just £100k costs over 25 years (repayment):-
7%, £212,034(£18,744 more than at 6%)
6%, £193,290 (£17,913 more than at 5%)
5%, £175,377

So if you have a £200k mortgage an increase of 1% costs £38k/£36.

teabelly

It's quite fun to use some of the web archive tools to see what the HPC site used to have on it a few years ago. One gem is some economics expert writing in 2001 that prices were going to crash and he was going to sell to rent. Bet he feels a right nana now. There have also been articles from Morgan Stanley saying prices are over priced by 20-30% for quite some time so most of what is being said is nothing new.

The key issue is to sort out liquidity in the financial markets and have all institutions come clean about what sub prime collateral they have tucked away and at what leverage levels. Once this dirty linen is out then the LIBOR will drop and mortgage products can return. HPI also needs to get to sensible levels not 10% pa. 5-7% pa max is probably what is sensible. A few years of 2 or 3% growth to ease those with negative equity and to encourage wages to rise to meet prices more would also be beneficial. Also the cost of living has been far outstripping the joke RPI so wages need to rise by 5%+ a year for a couple of years so that people can actually live within their means not rely on cheap credit to pay the bills which is the only reason employers have got away with paying p' poor wages to a lot of people.

tomstickland

The HPC loons/permabears have been wrong for 5 years

Yes, the longer someone is wrong then the more wrong they are! Unless when what they predict finally does happen then it's a lot more severe.

TighterThanTwoCoatsOfPain

Really couldnt be bothered to read all the above posts, this part of the forum used to be informative, now its tedious beyond belief...

me? personally not arsed if prices go up or down, just into our "family house" and tucked up on a low 10 year fixed rate.

I bought my first house at 19 about 8 years ago. I was warned by the FA i used that i was buying at the crest of the wave and i coulda saved a MASSIVE 3k on my mid terrace if a) i was 3-6 months earlier, or b) i waited a while for the crash!!. I borrowed 3.5 times sole salary at the time at it was tough.

My mates said i was crazy to buy a house at whilst market was "booming".

Do i feel sorry for all the young people (i mean 18-23 ish) who want to buy a house? Perhaps a little bit, but then most seem to think a 2up 2down is beneath them so then my sympathy wains...

Do i feel sorry for ANYONE over my age or over who has been waiting for a "crash" for the last 8 year? errrrr no! My attitude has always been to buy a home, if i hadnt then i wouldnt have the beautiful house i have now and would probably be as bitter as half the people on here.

Normally avoid threads like this, but feel better for finally getting it off my chest! lol

tomstickland

Do i feel sorry for all the young people (i mean 18-23 ish) who want to buy a house? Perhaps a little bit, but then most seem to think a 2up 2down is beneath them so then my sympathy wains...

I know people on a good income who couldn't even buy a bedsit at current prices. It's very convenient to say "oh it's just young people being really pickey, they all want 4 bed detached homes as their first place". It's not true though.

ManAtHome

Don't remember anyone saying "the boom will soon be over in 2000", was only really getting back to somewhere near normal by then (several houses in my road finally started selling after being on the market 7 or 8 years).

2004 was when tings should have started tailing off as we were getting towards the limits of lending. (un)fortunately the lenders then started many and varied ways to sling more cash around (mainly by transferring the risk elsewhere). So we now have 3 or 4 years-worth of rash ("risk free"...lol) lending to unwind - or does anyone still think the banks will be throwing loans at people sometime in the next few years?

Lavendyr

To TighterThanTwoCoatsOfPain: Absolute rubbish. We'd love to be able to afford a 2 up, 2 down...it's actually more or less our ideal home (we rent one in fact). But we can't afford to buy one.

TighterThanTwoCoatsOfPain

@ Lavendyr - re-reading, i guess it does appear to come across as perhaps a shade arrogant, certainly not deliberately so... Please dont take the below personally as not aimed at you, or anyone else specifically. Accept there are always exceptions to every scenario.

however - guess i can only comment on the area i live in, the people i know, and the wages they earn.

when you say "We" there are two of you right? And presume you are in the 'young' range i mention above?? Lets say you earn 15k each? Dont think thats unreasonable in ANY line of work... Plug that into many online calculators are you'll probably get about 100-115k ish.... If you're not picking and choosing style / areas etc you can still get a terrace for this. Hell, i just sold a 3bed demi with garage for 125k

now lets presume you have been preparing for this house purchase financially (like i did, and my parents etc before me) and havent just decided you want it NOW like many people because owning our own house is a right and not a privilege (generalising ENORMOUSLY granted).. 24months @ £400 per month (much less than a mortgage but then you were living with parents so is easy to save this much right?)

You now have your 10% deposit (although obviously these are now getting much tighter, BUT then these threads popped up long before they started tightening criteria)

Oh yea, i foolishly assumed the young couple havent gone out and blitzed 10k on an HPI agreement for a flash car or have credit cards up to the hilt due to holidays etc.

Taking the first step has NEVER been easy for any FTB going back 40 years.... my parents paid 17k for the old 'family' home.. they nearly had to pull out of the deal for the sake of 500 quid and suffered 2 digit interest rates... only difference is they didnt have the internet to bleat about what a hard time they were having....

teabelly

Lavendyr wrote: »

To TighterThanTwoCoatsOfPain: Absolute rubbish. We'd love to be able to afford a 2 up, 2 down...it's actually more or less our ideal home (we rent one in fact). But we can't afford to buy one.

Where are you looking? There is plenty of unsold auction property around and that usually indicates a seller that will take a deal just to off load it.

firsttimetom

The HPC loons/permabears have been wrong for 5 years, so get over excited about stuff actually starting to happen. They seem to think they were right all along for some bizarre reason.

Love quotes like these!!!

Talk about tar everyone with the same brush. I must admit I am pro HPC, but when I joined these forums a year ago, I was actually looking to buy. (You can find my first post from April 07 if you so wish). A house price crash ad never crossed my mind.

I started to here things about a crash and A LOT of people were saying 'it'll never happen' and were describing hpc.co.uk as a site full of loonies. They converted me though and I now follow their beliefs that the market will tank.

A year later and how have House Prices done??

Well they are up 1.1%!!!!! And have fallen for the last five months

How glad I am that I didn't listen to the people harping on about house prices only ever go up. (ok so they have gone up in a year, but by 1.1%. 1.1%? That's less than Gordons laughable 2.1% CPI)

Also, OP, the one with the garish text colour. If you find these discussions so boring, why did you start a whole new thread which you KNEW would start an argument.

As for renting, I think the 'HPC brigade' are only looking at short term renting. I realise that people probably sold in 2002 and have been renting since whilst house prices have hit the moon. I don't think there is anybody on here who sold up and rented in 2002. The only one i kow to have even STR (i think) is PasturesNew a year ago ish.

Lastly, to all these people who are saying their won't be a crash, please can you answer one question?

Why on earth are high house prices such a good thing?