Mortgage Rate Rises

dlockers · 22 Jun 2023 at 18:46

scottomus0 said:
What is the general consensus, in terms of people coming to an end in the few months. 2 year fixes, 3 years? Or even 5? I need to do mine tonight before they increase again.

I can choose for it to start from 1st Oct, does that mean i can cancel it before then, if they were to drop?

What's the numbers? I'm thinking 5 year fix as 2 years are just $lol and no one really knows.

ddoubleep · 22 Jun 2023 at 18:49

dLockers said:
What's the numbers? I'm thinking 5 year fix as 2 years are just $lol and no one really knows.

Mate did 2 Years but is convinced it'll drop to 3% in 2025! Wishful thinking as 5 years lets you ride it out and lock another 5 years on the way down.

dlockers · 22 Jun 2023 at 18:58

ddoubleep said:
Mate did 2 Years but is convinced it'll drop to 3% in 2025! Wishful thinking as 5 years lets you ride it out and lock another 5 years on the way down.

It's been way too low for ages so I think 4% in 2025, maybe 3.75% as the regular rate forever more....

Jono8 · 22 Jun 2023 at 19:10

I think if inflation starts to ease, they will keep it at around 5 for a while and then hopefully drop to between 3-4 if things settle.

Although seen as capatlism is just a never ending cycle of boom and bust we will probably have a crash and they will have to drop it to 0 again.

Hawk Tuah · 22 Jun 2023 at 19:26

I think the critical period is going to be 5 years after the stamp duty holiday was introduced.

If it's still really high then, I think a crash and huge numbers defaulting is inevitable.

413x · 22 Jun 2023 at 19:29

Jono8 said:
I think if inflation starts to ease, they will keep it at around 5 for a while and then hopefully drop to between 3-4 if things settle.

Although seen as capatlism is just a never ending cycle of boom and bust we will probably have a crash and they will have to drop it to 0 again.

Roll on 0pc! If it arrives in 2027 all the better!

Jono8 · 22 Jun 2023 at 19:34

Bug One said:
I think the critical period is going to be 5 years after the stamp duty holiday was introduced.

If it's still really high then, I think a crash and huge numbers defaulting is inevitable.

Isn't it currently due to end on 31st March 2025 (or is that what you mean)?

GordyR · 22 Jun 2023 at 19:38

dLockers said:
It's been way too low for ages so I think 4% in 2025, maybe 3.75% as the regular rate forever more....

Pretty much where I’m at, and that’s best case scenario.

dlockers · 22 Jun 2023 at 19:39

Bug One said:
I think the critical period is going to be 5 years after the stamp duty holiday was introduced.

If it's still really high then, I think a crash and huge numbers defaulting is inevitable.

Do you reckon it made that big of a difference? The money just went to the "vendor" rather than the government; prices didn't drop did they, they went up.

Jono8 · 22 Jun 2023 at 19:42

They cannot go much higher anyway without totally ***** everything. Hopefully someone in the BoE has a brain and realises that they are not living in the 80's anymore.

"Mortgage rates of 6.43% today are equivalent to a rate of 25.7% in 1980 -housing is now at its least affordable since records began."

https://www.leedsbuildingsociety.co.uk/_resources/pdfs/press-pdfs/press-releases/housing-is-now-at-its-least-affordable.pdf

Any higher and no one will be able to afford their mortgage.

Hagar · 22 Jun 2023 at 19:52

I don't think that bank rate will ever go back to 1 or 2%. Most likely around 3% IMO. Savings may then be approximately equal to inflation. Assuming the bank restores the level.

glenimp617 · 22 Jun 2023 at 19:53

Nitefly said:
What are people who want a better home supposed to do as an alternative for buying a better home?

There isn't really which is why we haven't moved

413x · 22 Jun 2023 at 19:56

Hagar said:
I don't think that bank rate will ever go back to 1 or 2%. Most likely around 3% IMO. Savings may then be approximately equal to inflation. Assuming the bank restores the level.

Never say never

Nitefly · 22 Jun 2023 at 20:00

TheOracle said:
There isn't really which is why we haven't moved

Hopefully your current house affords you a good quality of life and meets your future requirements.

MikeTheNative · 22 Jun 2023 at 20:24

dLockers said:
No chance man --- tracker will be pricing in mega risk IMHO.

Do you think rates will still be going up in 2025? It's 5% now, we would be up 8+ by then with the current trend.

Jono8 · 22 Jun 2023 at 20:24

MikeTheNative said:
Do you think rates will still be going up in 2025? It's 5% now, we would be up 8+ by then with the current trend.

Im not sure going to 8% is workable. Everyone would be broke.

That would take a £200k mortgage over 25 years to monthly payments of £1550. Take home pay on an average/median salary isnt much more than £2000! factor in bills, council tax, food etc etc and you are well over that and well into a decent (and necessary) second salary too (to do anything other than work).

neocon · 22 Jun 2023 at 20:28

Jono8 said:
Im not sure going to 8 is workable. Everyone would be broke.

Not everyone, but maybe a good portion

dlockers · 22 Jun 2023 at 20:29

MikeTheNative said:
Do you think rates will still be going up in 2025? It's 5% now, we would be up 8+ by then with the current trend.

I don't think rates will, but I think banks will be hedging a lot of risk given the uncertainty...?

413x · 22 Jun 2023 at 20:32

8 percent would break everything it would not achieve anything. It won't get that high.

dlockers · 22 Jun 2023 at 20:44

413x said:
8 percent would break everything it would not achieve anything. It won't get that high.

Pfft, millenial. dO yOu nOt rEmEmBeR tHe nInEteEn sEvEnTiEs