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Debate House Prices
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0.25% cut in BoE base rate
Comments
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Yeah right. Strange how they waited until the last 8 months or so before deciding to 'blunt the out of control house prices' isn't it?
Not strange really. They just called it completely wrong.
Their mandate is to target CPI - a highly fiddled figure designed to leave house price inflation out of the reckoning as well as to minimise the true level of inflation - and they only started to cautiously inch their rates up after years of stupidly low IRs after even the CPI started to get out of control.
CPI is hardly 'highly fiddled.' It is what it is. Anybody who really needs to know will understand the difference between RPI and CPI. It's NOT complicated as you well know! You could argue that it is useful to have the two very simple figures available.
That's because if anything they've went out of their way to facilitate rising house prices at the expense of general inflation control - you only have to see their actions in August 2005 for proof of that when they stalled a decline in HPI with a completely nonsensical interest rate cut. A monumentally stupid and short-sighted policy decision which many people who subsequently entered the housing market will be suffering the effects of very very soon.
Yes. Why do we keep hearing the same stuff from posters on here? We know this.
But enjoy your interest rate relief at my expense if you are one of the lucky ones to get it (it's aimed more at helping the banks recapitalise but getting the heavily-in-debt, none-too-financially-clued-in public on side is undoubtedly a bonus for the government).
I don't feel smug about the rate cut. I have a lifetime tracker, so expect some nasty rises over the term of my mortgage. I'll take the rate drops when I can and brace myself for the rises. It's all swings and rounabouts, and I understand that.
You appear to be suggesting that I am one of the 'not-too-clued-in' public. Very presumptuous indeed. I assure you that I'm reasonably clued up, not heavily in debt, and certainly not 'on side' as you put it.
Personally, I'll now be looking for other avenues of investment for my substantial cash savings than the bank as it's clear which way this is all going to be going (the prudent being ripped off to bail out the reckless). If enough other savers think likewise it may turn out to be a somewhat pyrrhic victory for the UK banks.
Ooh 'substantial savings.' eh? I personally have a simple ISA at 6.5%. But Jolly good for you though!0 -
Lets face it, you can all argue until your blue in the face, but theres no getting away from the facts:
House prices are toast
The economy is toast
Recession just around the corner
Get used to it!0 -
=brit1234;10096875]Mr Edinvestor
Some of us have been saving large deposits for years. It not a case either of desperately wanting a house price crash because the the financial conditions were set for it to occur anyway.
The banks want our money so much that I am getting very good interest on my deposit (£150 a month).
Its all the conditions above which you have listed which is going to bring prices down 35-50% in the next two years:beer:.
Hmmm, do you really believe that the BOE is totally independent from this government ?:rotfl::rotfl: :rotfl:0 -
EdInvestor wrote: »I'm really starting to feel sorry for all these preople who desperately want a house price crash.
*First mortgage interest rates go up, so it will cost them a lot more to buy
*Then LTVs go up, so they have to save much more for their deposit
*Then savings interest rates start coming down, which means inflation will rise, so their living costs go up
*.... and they get less interest on their savings so it's harder to gtet a deposit together
They just can't win, it seems. :rotfl:
What an idiot. Look at the BIGGER PICTURE instead of right now. Most of us 'desperate' for a crash aren't looking to buy in the near future but 4 years or so away. The crash, my friend, will be well in full swing by then and most of us would had saved a much significant deposit to put down on a much CHEAPER house. By then so many reposession will be in place the banks will welcome new business and offload their 'repos' at auction.
You may mock us now, but we will, be rest assured, have the last laugh. Then we can mock all those idiots mortgaged to the hilt on the brink of bankrupcy due to all the mewing they done by buying 4x4's etc, and their house being worth SIGNIFICANTLY far less than the outstanding loan on it.
Our time will come.. laugh all you like. FTB situation is looking very good for the next 5 years. My only guess at your response is bitterness about how much mortgage you have outstanding on a very normal, not very exciting house as you watch nominal drops month on month knowing it will be worth sooooooooooo much less this time next year.
Ha ha0 -
Does anyone know:
a) amount of mortgage debt in the country at present
b) amount of non-mortgage debt
c) amount of cash in bank accounts - current, savings, ISas, Tessas etc?
I'd like to know if a+ b is greater or less than c
Am sure all you wise ones will know A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
Mortgage Balance = £0
"Do what others won't early in life so you can do what others can't later in life"0 -
My mortgage is 5.74%. My ISAs are 6% - 6.5%.
If I was saving for a deposit, the interest rates are great at about 230% x inflation.
If I was a FTBer, mortgage rates are great and at close to all time low - and falling.
If I was a HPCer, the signs are that I'm getting what I want.
If I'm a homeowner, my mortgage is likely to fall.
Smile people, the glass is half full today!
GGThere are 10 types of people in this world. Those who understand binary and those that don't.0 -
Does anyone know:
a) amount of mortgage debt in the country at present
b) amount of non-mortgage debt
c) amount of cash in bank accounts - current, savings, ISas, Tessas etc?
I'd like to know if a+ b is greater or less than c
Am sure all you wise ones will know
Depends what 'etc.', covers.
GGThere are 10 types of people in this world. Those who understand binary and those that don't.0 -
EdInvestor wrote: »I'm really starting to feel sorry for all these preople who desperately want a house price crash.
*First mortgage interest rates go up, so it will cost them a lot more to buy
*Then LTVs go up, so they have to save much more for their deposit
*Then savings interest rates start coming down, which means inflation will rise, so their living costs go up
*.... and they get less interest on their savings so it's harder to gtet a deposit together
They just can't win, it seems. :rotfl:
Don't worry about us - we would be looking at 50% LTV if we bought now, and are getting better interest rates than the base rate by some distance. We are also saving nicely, as our rent is cheaper than the interest part of the mortgage would be....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0
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