Mortgage Rate Rises
- Thread starter glenimp617
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All we are trying to show is that the market of today is different to when we took out our mortgage.
Definitely accurate with the oldies on one side and the youngsters on the other. Neither can see the others point of view because of living in different times.Funny... Albeit also accurate when you hear some people
Objectively it is harder for young people today to afford a house though. A more accurate position from "oldies" would be "We found it tough, but now it's even worse for you". Rather than blaming avocado toast...
What has living in different times got to do with the following fact:
Average house prices have risen much faster than average wages in the last 30-40 years to the point that they are now 8x average wage compared to 4x in the 80s/90s negatively impacting affordability.
@Hagar @tonys - is what I have written incorrect?
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That's probably how it should be worded but as I have said before the market today has adapted to that problem and others for the buyers of today.
Maybe you should add "it will take you longer to own a house"
My parents are in their 70s and even they know it's harder to buy a house today. It's not hard to work it out.
No , that is correct but fails to address the difference in how mortgages are used now to try and get the affordability back down.
How are mortgages used now to try and get affordability back down compared to back then?
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Do they say if it was easy or hard for them when they first bought a house?
Mortgages being used like this e.g longer terms etc is not an argument in your favour it's a symptom of house prices rising much faster than wages.
It's just a fact its much harder today for young people to bug a house. The fact older people push back on that for some reason is very telling in itself.
Older people think they had it hard, many can't seem to accept its even harder today.
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We had only variable 25yr or under terms. Today you have fixed and 25yrs plus terms.
We had to pay any increase the following month, with fixed rates it's deferred until renewal.
The criteria for help was changed due to the repossessions in the 90's. Before that you had to pay the mortgage regardless of other commitments(food or utilities this is from personal experience from the high interest times.)
There are other differences but I'm too slow at typing.
My parents had more problems with dodgy estate agents than any financial aspects. Getting a mortgage was easy: they strolled into the local bank branch and came out with a mortgage offer.
My parents were absolutely not financially well positioned. In that same position today, there's no way they would get on the ladder.
I'm not arguing about that but that is how the governments and housing market have adapted to allow people to continue buying houses.
When did they buy because we had a hard time getting a mortgage. We had to wait for the funds to be allocated once we had found a house.
@200sols has already covered this in the meantime (a couple of posts up) so I won't regurgitate it.
You also won when the rates came back down with immediately reduced payments. Someone that is fixed prior to a drop in rates has to keep paying the higher rate until renewal, which could be years, unless they pay a, usually large, ERC
Will we call that one equal?
I am not sure that is true... According to Google Gemini:
"In the 1990s, like today, mortgage payments were generally considered a high priority, often prioritized over other bills, due to the risk of foreclosure. While there wasn't a legal requirement to pay the mortgage before other bills, the consequences of not doing so, such as losing the home, made it a financial priority for homeowners."
So, no, this was no different in the 90s than it is now. A similar result appears if I change it to "80s"
The differences you did post are either incorrect or debatable regarding affordability TBH.
I am not sure if older people have conflated what young people are saying TBH and taking personal offence from this conflation
Just because young people say it's harder to buy a house compared to 40 years ago, is NOT the same as them saying it was easy to buy a house 40 years ago.....they are just saying it is harder now, which it is.
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Late 70s.
Presumably they were members of said bank for some time and in good standing with it. Most mortgages came from building societies and with the same provisos as above. Loans were not handed out willy nilly there had to be understandings and money was tight. Banks would readily bounce cheques and credit cards were in their infancy. I am not decrying the house buyers of today, it has always been tough and not so simple as you are making out. We also had high income taxes and little welfare state to contend with
My own property about that time had one powerpoint upstairs, no damp course and required extensive and expensive renewals and renovations, an 1890's working man's cottage. It is now quite a nice terraced house last on the market at £180k i believe. A very old friend still lives in that street.