Mortgage Rate Rises

unwashed potato! · 10 Jul 2025 at 14:32

200sols said:
One couple round the corner like that here, they paid £600k for their house in 2022, now they want to move and the price is currently at £565k after 2 drops, I'm sure it'll drop again. If you ask me these houses are simply not worth that money.

I see other houses not selling either, prices are simply too high it seems and falling (very) slowly.

I'm surprised to hear this. I guess the issue is that interest rates are higher now that higher priced houses are too expensive. Before an expensive how was affordable when interest rates are less than 2 percent.

Just noticed that article is talking about USA homes. I wonder what it's like here in the UK

Freakbro · 10 Jul 2025 at 14:35

That article is talking about US homeowners, not sure we've had the same effect here as overall all we've experienced is a slow down in house price growth in nominal terms.

200sols · 10 Jul 2025 at 14:37

unwashed potato! said:
I'm surprised to hear this. I guess the issue is that interest rates are higher now that higher priced houses are too expensive. Before an expensive how was affordable when interest rates are less than 2 percent.

Just noticed that article is talking about USA homes. I wonder what it's like here in the UK

For context that house last sold in 2011 for £290k. In some areas people really did pay a huge covid premium. After stamp duties etc they're looking at a £100k loss.

Hagar · 10 Jul 2025 at 14:39

The point being that as well as a stamp duty holiday we had the prospect of long term working from home and hence larger houses were in a unique demand position together with some outdoor space and a companion dog.

Now that we are back to reality as well as having more realistic interest rates, a lot of people find that they cannot afford the expenditure and also living out in the sticks is boring so a return to town is on the cards again.

Poor dog.

Freakbro · 10 Jul 2025 at 14:42

The increase in interest rates has hit the housing market in an uneven way ofc, with the top end of the market becoming less desirable due to affordability of a high mortgage with high rates.

unwashed potato! · 10 Jul 2025 at 18:01

Hagar said:
The point being that as well as a stamp duty holiday we had the prospect of long term working from home and hence larger houses were in a unique demand position together with some outdoor space and a companion dog.

Now that we are back to reality as well as having more realistic interest rates, a lot of people find that they cannot afford the expenditure and also living out in the sticks is boring so a return to town is on the cards again.

Poor dog.

My experience is the opposite in terms of the reality.

Everyone I know who started working from home during covid hasn't gone back. Maybe the odd day here or there, but they have even moved jobs and all of them work from home primarily if not entirely

Mr Badger · 10 Jul 2025 at 18:13

unwashed potato! said:
My experience is the opposite in terms of the reality.

Everyone I know who started working from home during covid hasn't gone back. Maybe the odd day here or there, but they have even moved jobs and all of them work from home primarily if not entirely

A lot of employers that may have embraced homeworking during the lockdowns, have since become quite insistent about employees returning to the office for at least part of the week.

matt100 · 10 Jul 2025 at 19:24

Hagar said:
The point being that as well as a stamp duty holiday we had the prospect of long term working from home and hence larger houses were in a unique demand position together with some outdoor space and a companion dog.

Now that we are back to reality as well as having more realistic interest rates, a lot of people find that they cannot afford the expenditure and also living out in the sticks is boring so a return to town is on the cards again.

Poor dog.

And you're happy about this? I sort of get there may be grounds if people were trying to capitalise on a situation to make money..

These are people who bought a house and now for whatever reason need to move and you're happy they're experiencing pain.

Stay classy

Hagar · 10 Jul 2025 at 19:35

matt100 said:
And you're happy about this? I sort of get there may be grounds if people were trying to capitalise on a situation to make money..

These are people who bought a house and now for whatever reason need to move and you're happy they're experiencing pain.

Stay classy

Not happy but they overextended on many cases and distorted the market. Probably excluding more people then helping themselves.

It is a little like the nineteen nineties with many people exploiting cheap remortgagesand spending on cars and holidays. Ending up in the doodoo.

matt100 · 10 Jul 2025 at 22:01

Hagar said:
Not happy but they overextended on many cases and distorted the market. Probably excluding more people then helping themselves.

It is a little like the nineteen nineties with many people exploiting cheap remortgagesand spending on cars and holidays. Ending up in the doodoo.

People living their lives and you're saying it serves them right?

And do what else exactly? Just choose not to live somewhere?

Hagar · 11 Jul 2025 at 06:48

matt100 said:
People living their lives and you're saying it serves them right?

And do what else exactly? Just choose not to live somewhere?

You live your life and you make your choices.

BUDFORCE · 11 Jul 2025 at 07:17

Hagar said:
You live your life and you make your choices.

Yea depends on the scenario but I don't have any sympathy for some of these people, big house, nice car everything stretched financially to the max.

Then are crying it's everyone else's fault when it all comes crashing down.

matt100 · 11 Jul 2025 at 07:49

Who said anything about anyone being stretched or cars or crying?

I swear this sort of thing lives rent free in some people's heads.

squerble · 11 Jul 2025 at 07:52

matt100 said:
People living their lives and you're saying it serves them right?

And do what else exactly? Just choose not to live somewhere?

There's a difference between people "living their lives" and not considering the implications of their decisions. A lot of people were very short-sighted in the Covid era, especially when it came to house buying and moves - the implications of mortgage rates after promotional rates expire especially. People thought they could "afford" a bigger house just as the mortgage rates started rocketing, when in fact that was the stretch, and completely ignored the fact they'd be taken beyond their means a few years later when that low rate ran out.

matt100 · 11 Jul 2025 at 07:59

Again I think perhaps something is living rent free.

There's no mass repossession like happened to the numbskulls in the 80s/90s, no bailouts etc..

Folk seem to be manufacturing something to complain about and sneer at?

You live your life, sometimes it's good, sometimes it's bad.

My issue is certain people proactively gloating at something they've dreamed up vecUse they like the idea of people maybe being in distress even if they have no proof. It's pretty gross/depressing.

tonys · 11 Jul 2025 at 08:42

matt100 said:
Again I think perhaps something is living rent free.

There's no mass repossession like happened to the numbskulls in the 80s/90s, no bailouts etc..

Folk seem to be manufacturing something to complain about and sneer at?

You live your life, sometimes it's good, sometimes it's bad.

My issue is certain people proactively gloating at something they've dreamed up vecUse they like the idea of people maybe being in distress even if they have no proof. It's pretty gross/depressing.

Most of the repossessions in the 80's/90's were down to higher interest rates that were going up monthly(way above what would have been reasonably expected), recession and no mortgage protection that people have today. The governments of the time realised this and put in the measures we have today to keep the housing market going. People who took out big mortgages on very low interest rates should have looked at the reality of what their payments would go up by and budgeted accordingly.

Slam62 · 11 Jul 2025 at 08:44

BUDFORCE said:
Yea depends on the scenario but I don't have any sympathy for some of these people, big house, nice car everything stretched financially to the max.

Then are crying it's everyone else's fault when it all comes crashing down.

Yeah, it’s just tough isn’t it. You win some you lose some.

Slam62 · 11 Jul 2025 at 08:44

tonys said:
Most of the repossessions in the 80's/90's were down to higher interest rates that were going up monthly(way above what would have been reasonably expected), recession and no mortgage protection that people have today. The governments of the time realised this and put in the measures we have today to keep the housing market going. People who took out big mortgages on very low interest rates should have looked at the reality of what their payments would go up by and budgeted accordingly.

It was also high unemployment

tonys · 11 Jul 2025 at 08:46

Slam62 said:
It was also high unemployment

Forgot that, thanks.

robj20 · 11 Jul 2025 at 08:46

BUDFORCE said:
Yea depends on the scenario but I don't have any sympathy for some of these people, big house, nice car everything stretched financially to the max.

Then are crying it's everyone else's fault when it all comes crashing down.

Very true, when we got our first house and principal offer we purposely went for the smallest house we could in the nicest area, borrowed at the lower end of what we got offered with the plan that either one of us could cover all bills as a worst case. No sympathy for people that chose to borrow to the max.