[Finance] Base rate increase.

[mejonaNO12 aka riskit]

Find me one home owner that says "my house has gone up in value by xxx thousands of pounds but that makes me sad"

Me when I wanted to move 3 years ago.

Yes, my house had increased by 50% but it was a cheaper house

I wanted to move to a better, more expensive house. That had also gone up by 50% in the same time.......so it was going to cost me more to move.

It's remarkably simple.

 

[Biscuit]

Preparing myself my mortgage going up by £500pm. Almost doubling. Joy.

I've got some saving and various income streams so can ride the storm for a little bit but Jesus Christ how are people coping?!

 

[Uncle C]

Me when I wanted to move 3 years ago.

Yes, my house had increased by 50% but it was a cheaper house

I wanted to move to a better, more expensive house. That had also gone up by 50% in the same time.......so it was going to cost me more to move.

It's remarkably simple.

But that's not answering the question is it.

Your unhappines was in the increased price of your new home not the one you currently owned.

Can you honestly say there was no time during ownership that you were not impressed that it had risen in price compared to what you paid for it.

 

[mejonaNO12 aka riskit]

But that's not answering the question is it.

Your unhappines was in the increased price of your new home not the one you currently owned.

Can you honestly say there was no time during ownership that you were not impressed that it had risen in price compared to what you paid for it.

No.

Because I knew I would want to move one day. I just watched my prospective purchases get more and more expensive.

I would only ever be excited about the cost of my house going up if I was in my final home and it was coming to mortgage renewal time (as my LTV would be improved) or I was looking to downsize.

 

[Westdene Seagull]

Find me one home owner that says "my house has gone up in value by xxx thousands of pounds but that makes me sad"

A house going up by xxx pounds is only 'profit' if you plan to sell and down size or you die and it's profit to your estate. For example - I brought my house 16 years ago for £250k - had it valued a couple of months ago and it's worth £500k ( assuming someone is prepared to pay that ). To get a house of equivalent quality I need to spend .... you've got it .... £500k. Unless of course I move out of B&H to somewhere cheaper say Cornwall. Even then after costs I probably wouldn't have much 'profit'. Normal people do not profit in the day to day housing market.

Anyway, where's this property price crash you promised us ?

 

[Uncle C]

A house going up by xxx pounds is only 'profit' if you plan to sell and down size or you die and it's profit to your estate. For example - I brought my house 16 years ago for £250k - had it valued a couple of months ago and it's worth £500k ( assuming someone is prepared to pay that ). To get a house of equivalent quality I need to spend .... you've got it .... £500k. Unless of course I move out of B&H to somewhere cheaper say Cornwall. Even then after costs I probably wouldn't have much 'profit'. Normal people do not profit in the day to day housing market.

Anyway, where's this property price crash you promised us ?

Its your estate thats gone up in value.

"Anyway, where's this property price crash you promised us ?"

It was forestalled by all the mugs that bought houses believing that interest rates would stay below 1% forever. I never believed there would be that many people putting their heads in a noose, but now we are seeing the consequences.

Wont be long before they start to blame it all on the Tories.

 

[chickens]

Its your estate thats gone up in value.

"Anyway, where's this property price crash you promised us ?"

It was forestalled by all the mugs that bought houses believing that interest rates would stay below 1% forever. I never believed there would be that many people putting their heads in a noose, but now we are seeing the consequences.

Wont be long before they start to blame it all on the Tories.

The simple fact that people wanted to be out of the private rental market and onto the housing ladder does not make them targets for contempt.

If they went to the bank, and the bank said they would lend them the amount involved, then the average person on the street is going to believe (post-2008) that regulations and lending criteria have been toughened up, wages have historically risen over time, and that the mortgage that is difficult today, will be easier to bear tomorrow. In short, if the bank says yes to lending, the borrower will consider it a safe amount to borrow, because the bank is supposed to be the responsible financial expert.

The condescension that your post reeks of, I find genuinely distasteful.

 

[raymondo]

I got back on the property market with a modest house in 1999.

I worked with a know it all, an incredibly tight fisted bachelor, who bought a crap bungalow but in a very posh part of the city in the mid 90’s …. perfect timing if you love money. All part of his wealth making plan, he was proud of that forever and calculating his wealth. The archetypal ‘knew the price of everything and value of nothing’.

Yes, I had work colleagues who made a lot more out of property than I ever have: buying, doing up, selling, then buy-to-let, it was their main focus in life. I'm not knocking it really, fair play they did well. I spent much of my spare money on travel and still do (no regrets there), and now happy in one home with zero mortgage and fairly secure finances for the family...to give them a start.

 

[Weststander]

Me when I wanted to move 3 years ago.

Yes, my house had increased by 50% but it was a cheaper house

I wanted to move to a better, more expensive house. That had also gone up by 50% in the same time.......so it was going to cost me more to move.

It's remarkably simple.

Yes, but apart from you

 

[Uncle C]

The simple fact that people wanted to be out of the private rental market and onto the housing ladder does not make them targets for contempt.

If they went to the bank, and the bank said they would lend them the amount involved, then the average person on the street is going to believe (post-2008) that regulations and lending criteria have been toughened up, wages have historically risen over time, and that the mortgage that is difficult today, will be easier to bear tomorrow. In short, if the bank says yes to lending, the borrower will consider it a safe amount to borrow, because the bank is supposed to be the responsible financial expert.

The condescension that your post reeks of, I find genuinely distasteful.

You claim the average person is incapable of seeing that an interest rate of zero can only go one way. And you call me condescending.

OK lets not blame the Tories but lets blame the Banks. It typical that some peple cant take resposibility for their own actions

 

[Soton Seagull]

Not sure many UK mortgage holders should take responsibility for Russia invading Ukraine and Liz Truss! The 2 main reasons for inflation (plus the B word - so 52% of them can be blamed for that bit) and interest rates hikes.

 

[chickens]

You claim the average person is incapable of seeing that an interest rate of zero can only go one way. And you call me condescending.

OK lets not blame the Tories but lets blame the Banks. It typical that some peple cant take resposibility for their own actions

With the removal of social housing stock, housing options in the U.K. are:

1. Private rental
2. Private ownership
3. Homelessness

Private rentals are of vastly varying quality and offer very little protection to those renting them. A landlord can raise rent, or simply decide they want to sell the property and the occupier has lost their home.

Given the above, private ownership is attractive. It gives (relative) stability as well as allows the occupier to be building equity. Often housing equity is never used in the occupier’s lifetime, but is used to try and give the following generation a decent start. It also means there is a time in life where the mortgage may be paid off and there is disposable income for hobbies or holidays (money spent in the wider economy)

You and I both know that over decades there are periods of financial disruption. You and I also know that it’s pure blind luck as to whether you take out a fixed deal that happens to expire in the middle of a period of disruption, or whether you’re lucky enough for your fix to not expire until order has been restored and rates stabilised.

Yes, rates were always going to rise, but there is nothing to say that rates won’t fall again later. A bit of empathy for those caught in the crossfire through no fault of their own wouldn’t go amiss. I’m glad you’re alright.

 

[worthingseagull123]

Where does the extra money go for mortgage repayments?

 

[Cheshire Cat]

How do people afford to buy a house these days?

Once upon a time it was a 5% deposit and 3 times your salary for a mortgage (possibly adding 1 times your partners salary depending on the lender).

If I can't afford to buy my house (which I have eventually paid for) now at current prices and salaries, who can and how?

 

[Weststander]

How do people afford to buy a house these days?

Once upon a time it was a 5% deposit and 3 times your salary for a mortgage (possibly adding 1 times your partners salary depending on the lender).

If I can't afford to buy my house (which I have eventually paid for) now at current prices and salaries, who can and how?

Either:

a) Well off parents gifting their kids big deposits. Quite a few nsc’ers have out of ISA or pension 25% tax free lump sum monies; or

b) Saving like crazy for many years for a deposit. £40,000 typical? So daunting that countless young folk don’t attempt the misery required in the prime of their lives. Instead nice holidays, eating out. Hard to blame them.

 

[indy3050]

It’s comforting to find others in my boat. It’s sinking, we’re all in it.

 

[pure_white]

5%+ by the summer?

and the rest please its about time we levelled up things for investors

 

[sydney]

Zimbabwe was the bread basket of Africa ......sunk by commuism now Ukraine seemingly the bread basket of Europe ( or that is one of the excuses being touted for price rises and general unavailability of basic foods) also , seeming sunk by communism.....seemingly.

 

[sydney]

To be fair to current youngsters (I am 43 and been with my wife since uni so we bought young and we are very lucky that we have a nice enough 4 bed and only about 60k left on the mortgage so a few more years).

Relatively close to me is leamington spa. A three bed house https://www.rightmove.co.uk/propert...&utm_source=copytoclipboard#/&channel=RES_BUY you are looking at about 250k entry.

Two people who want to start a family might find it pointless going for 2 bed due to expense of moving so start at bottom end 3. 250k means that if they are graduates on what 25k each then that is five times their combined income. However. To get on the property ladder without the help of the bank of mum and dad they need a 25k deposit.

Renting a 1 bed flat is about 800 quid a month. Council tax, bills. Food etc etc. their take home will be about 40k a year combined. So about 3330 quid a month. Taking out rent and bills how much are they left with? Then how do they get to work? Bus pass or train? All more cost. So how long would it take to save 25k needed for a deposit?

I just don’t see how the maths works.

that is the system under which the country is operating 100% controlled and regulated by the banks

 

[Seagull27]

Where does the extra money go for mortgage repayments?

What do you mean, the increased monthly repayment due to higher interest rates? It goes to the bank. That's the most galling thing - £500 a month extra, and not a penny of that extra fee goes towards my house.