Are you a "Recession virgin"?

WTF?_2

From Reuters:

http://uk.reuters.com/article/personalFinanceNews/idUKNOA52432220080415

LONDON (Reuters) - A quarter of "recession virgins" are worried about negative equity, a poll shows.

Around 23 percent of those between the ages of 24 and 34 who have not worked through a recession are fretting over the prospect for house price growth this year, according to personal finance website Fool.co.uk.

Only 23% are worried? They really are naive.

[Deleted User]

I fit squarely into that group - i'm 28 and bought my first home last year (and stretched quite a bit on the mortgage). Am I worried abour a recession? Not really

My job is secure (IT consultant, secure government contracts that run till 2012) my OH's job is secure (A&E nurse).

We should be able to ride it out without much problems. Count me in with the 77% not worried section

edit: I do remember lots of my friend's parents having financial problems in the late 80s, i think my parent's mortgage rate skyrocketed also

mr.broderick

Nope !!!!!! but can i ask? are you a virgin in the real sense of the word?

sarah_elton

!!!!!!? wrote: »

Only 23% are worried? They really are naive.

Negative equity is only an actual problem if you're forced to sell before it rises.

carolt

sarah_elton wrote: »

Negative equity is only an actual problem if you're forced to sell before it rises.

No that's not true. It's also a big (ie insurmountable) problem if you want to remortgage. If you don't have at least 5% (or possibly 10% or could soon be more if lenders get even stricter) equity, you end up getting stuck on the bank's punitively high SVR, once your initial shorter term rate runs out. Unless you bought on a fixed 25 year rate - and let's face it, how many did that? - this is is very real danger, and one that many people in the UK will soon be affected by (1-3million, depending whose figures you believe).

If you think monthly costs suddenly going up by possibly several hundred pounds overnight is not an 'actual problem' then you must have deeper pockets than most of the UK.

Kez100

sarah_elton wrote: »

Negative equity is only an actual problem if you're forced to sell before it rises.

Or need to remortgage and can't afford SVR. "Please keep up at the back"

I'm not a virgin. I have had the real experience - nothing fake - and the bigger it is the more it hurts. Been there and got the TShirt in the 1990's.

WTF?_2

ringo_24601 wrote: »

I fit squarely into that group - i'm 28 and bought my first home last year (and stretched quite a bit on the mortgage). Am I worried abour a recession? Not really

My job is secure (IT consultant, secure government contracts that run till 2012) my OH's job is secure (A&E nurse).

We should be able to ride it out without much problems. Count me in with the 77% not worried section

edit: I do remember lots of my friend's parents having financial problems in the late 80s, i think my parent's mortgage rate skyrocketed also

No danger of your organisation deciding to reduce headcount then?
Your employers have no other business outside of safe long-term government contracts (with no get-out clauses for the government)?
No danger of projects being cancelled?
No danger of your employer deciding to bring in cheaper workers or offshore some work?

As prices and costs rise (stagflation, seems to be happening now) businesses will inevitably look for ways to cut back. Headcount is inevitably the easiest and quickest way to cut the bottom line. Still, I admire your confidence.

ianmr65

!!!!!!? wrote: »

No danger of your organisation deciding to reduce headcount then?
Your employers have no other business outside of safe long-term government contracts (with no get-out clauses for the government)?
No danger of projects being cancelled?
No danger of your employer deciding to bring in cheaper workers or offshore some work?

As prices and costs rise (stagflation, seems to be happening now) businesses will inevitably look for ways to cut back. Headcount is inevitably the easiest and quickest way to cut the bottom line. Still, I admire your confidence.

Yes indeedy...

Don't forget the other elephant in the corner.

The massive & rising budget defecit, falling tax revenues, and the 10 years of goverment stimulating the economy with beurocratic non-jobs, paid for by the credit boom in the good years, and the massive rise in central and local goverment employment. Leading to massive innefficiency and waste.

Last time in the 1980's the public sector were safe(r) this time I fear that is no longer the case. Watch for massive slashes in public sector spending.

A_little_stressed!!

I vote: WORRIED (21yr old, mother, partner is homeowner)

EdInvestor

Negative equity is basically only a problem if you have a 100%+ mortgage with Northern Rock.

The SVR at other lenders is not "punitive" - and those people coming off deals this year will be expecting a rise anyway.

Those who are on repayment mortgages could also switch to interest only for a while to reduce outgoings, or extend the mortgage term if necessary.

Anyone with an endowment could also consider cashing it in and using the money to reduce the mortgage and the monthly payment (this may be a good move anyway).

Don't be fooled by doomster nonsense from speculators with a vested interest in a house price crash.

WTF?_2

EdInvestor wrote: »

Negative equity is basically only a problem if you have a 100%+ mortgage with Northern Rock.

The SVR at other lenders is not "punitive" - and those people coming off deals this year will be expecting a rise anyway.

Those who are on repayment mortgages could also switch to interest only for a while to reduce outgoings, or extend the mortgage term if necessary.

Anyone with an endowment could also consider cashing it in and using the money to reduce the mortgage and the monthly payment (this may be a good move anyway).

Don't be fooled by doomster nonsense from speculators with a vested interest in a house price crash.

Yes, all very funny but while you may find it a bit of a laugh to troll this group there are people who are here looking for advice and informed opinions.