Mortgage Rate Rises

[413x]

Yeh, phones are a ***** con.

They barely make any improvements now.

I only change when the battery starts to get rubbish now.

Changed my last phone when it got cooked in the car. My s21 ultra is great. Can see me keeping it ages.

My sim only is 5ppm

 

[Jono8]

Changed my last phone when it got cooked in the car. My s21 ultra is great. Can see me keeping it ages

I was sad i had to move on from my S10e. Best phone I have had. But, the battery started to only last half a day so started to become unusable really.

I got a Xperia 5 IV mega cheap through various cashback rebate deals and i love it. Battery is massive and lasts two days.

Hopefully will keep it until it dies.

I really hope that removable battery laws come into effect everywhere.

 

[Mercenary Keyboard Warrior]

Why? Borrowing you are at risk all the time. I don't see why savers should get a risk free option vs borrowers not having that option.

I don't see an issue (morally let's say) why everyone can't shoulder risk. The option is there.

Interest on savings is a bonus not a necessity. You save for a goal or a cushion, if you want to earn then invest it.

Because if you don't encourage savings and you make them highly risky then you encourage people not to.
Which raises the risks to the state that people go meh spend it all, someone will bail me out.

Problem is if you create significant imbalance in the value of the relationship dont complain when one party withdraws.
Its almost as if some people think they have a right to low interest rates.

Savers do face a risk, they face the risk that their savings will be damaged by long term interest rates being below inflation.

It also raises the risk that we end up socialising more debt onto the country since if no one is saving and we are having to sustain lending we have to magic up even more money.

The issue is not the rates, its the asset values, well and the wealth divide.

I always wonder how many people complaining about rates now voted conservative and for Brexit.

We have been following closer to a US model and as we go further that way the more we will see these types of thing.

This is largely irrelevant to my point

Having a place to live is a necessity, and sudden high interest rates now put on absurd house prices makes living almost unaffordable for many.

House prices are ~10x the average salary, and were only just about manageable due to low interest rates. Now interest rates are going up, the whole flimsy house of cards could collapse.

I don't give a **** whether savers get some more interest or not. I am talking about having a roof over your head and having the ability to afford a spot in this country of your own.

You had a point?
I replied to a waaa waaa post.

 

[Doobedoo]

Problem is if you create significant imbalance in the value of the relationship dont complain when one party withdraws.
Its almost as if some people think they have a right to low interest rates.

Savers do face a risk, they face the risk that their savings will be damaged by long term interest rates being below inflation.

It also raises the risk that we end up socialising more debt onto the country since if no one is saving and we are having to sustain lending we have to magic up even more money.

The issue is not the rates, its the asset values, well and the wealth divide.

I always wonder how many people complaining about rates now voted conservative and for Brexit.

We have been following closer to a US model and as we go further that way the more we will see these types of thing.

The point is saving and investing are two different things. You shouldn’t be saving to make money via interest, it’s a bonus but not a requirement. If making money is your objective then invest the money but obviously comes with a risk.

 

[Freakbro]

You shouldn’t be saving to make money via interest

Why?

My current partner talks about the 10% rates in the 80's, her and her husband at the time were making £30k a year in interest....not a bad income at the time for interest alone!

 

[Doobedoo]

Why?

My current partner talks about the 10% rates in the 80's, her and her husband at the time were making £30k a year in interest....not a bad income at the time for interest alone!

That’s a shedload of money required to make that much income. Again it’s a nice bonus but obviously in that case it’s not really needed.

I save not because I’m going to make big bank but because if I need something I can get it, if I lose my job I’m not going to be homeless, if my car breaks down I can afford to get it repaired. Save for a rainy day mentality.

 

[Mercenary Keyboard Warrior]

The point is saving and investing are two different things. You shouldn’t be saving to make money via interest, it’s a bonus but not a requirement. If making money is your objective then invest the money but obviously comes with a risk.

Again not sure why I have to spell this out.

Many people have some savings, they are not trying to make money they are using them as a nest egg, or for example saving for a house.
My grandfather had a relatively small amount in savings that he used to use to buy some bits n bobs and give to his grandchildren, for most of his life he lived in a council house.

There is a vast difference between when people should save and when people should invest.
There are MANY people for whom investing is a bad idea and they should not be.
My fear (and I have seen it) is that people are pushed to investing who shouldn't be.
It doesn't normally end well.

If you do not understand when and why investments should be used and by whom and when the opposite applies you really shouldn't be making statements like the above.

 

[Jono8]

That’s a shedload of money required to make that much income. Again it’s a nice bonus but obviously in that case it’s not really needed.

Yeh, £300k spare cash in the 1980's.....lol.

Not a realistic scenario for 99.9% of people

That is the equivalent of having £1.25 million sitting in the bank now!

 

[Freakbro]

That’s a shedload of money required to make that much income. Again it’s a nice bonus but obviously in that case it’s not really needed.

Well it is if you don't want to spend your capital and live off the returns.

They could have invested it and lost loads in the stock market crash of '87, I'd happily take the safe return of £30k a year...

Yeh, £300k spare cash in the 1980's.....lol.

Not a realistic scenario for 99.9% of people

That is the equivalent of having £1.25 million sitting in the bank now!

It was more about the comment of spare money should be invested rather than get interest returns.

 

[Doobedoo]

Again not sure why I have to spell this out.

Many people have some savings, they are not trying to make money they are using them as a nest egg, or for example saving for a house.
My grandfather had a relatively small amount in savings that he used to use to buy some bits n bobs and give to his grandchildren, for most of his life he lived in a council house.

There is a vast difference between when people should save and when people should invest.
There are MANY people for whom investing is a bad idea and they should not be.
My fear (and I have seen it) is that people are pushed to investing who shouldn't be.
It doesn't normally end well.

If you do not understand when and why investments should be used and by whom and when the opposite applies you really shouldn't be making statements like the above.

Again your misunderstanding. They are not saving to make money as you’ve just pointed out, if they do it’s a nice bonus but not a requirement.

 

[Uther]

That is £117k that could have gone into a pension. Even at that value it is £6000 a year extra for 20 years ontop of the state pension. When you think state pension is what 10 grand a year now that gives you £1300 a month to live off which is absolutely plenty if you have no mortgage to pay.

And that 117k would quite easily make that 6k back every year if invested, so you could probably bump it up to 10-12k on top of the state pension...

 

[Doobedoo]

Well it is if you don't want to spend your capital and live off the returns.

They could have invested it and lost loads in the stock market crash of '87, I'd happily take the safe return of £30k a year...



It was more about the comment of spare money should be invested rather than get interest returns.

We all would like to live in that particular utopia, but it means those without savings won’t be having roofs over their heads. We are at different ends of the spectrum I fear.

 

[fez]

House prices are ~10x the average salary, and were only just about manageable due to low interest rates. Now interest rates are going up, the whole flimsy house of cards could collapse.

And this is the core issue. The housing market for years now has pushing the boundaries of what people can pay. Thats almost entirely due to low interest rates. Most people were OK but didn't have masses of wiggle room. Now many people will have 0.

I only change when the battery starts to get rubbish now.

I replaced the battery in an iPhone X when it became awful after about 3 years and it gave me another year before I got the itch to upgrade. Wasn't necessary either. Just replace the batteries. They are ultimately a consumable item as much as people like to whinge and moan that the device they abuse for years isn't working as it did when brand new.

Why?

My current partner talks about the 10% rates in the 80's, her and her husband at the time were making £30k a year in interest....not a bad income at the time for interest alone!

If you are making that much interest you probably don't need it. Thats serious serious cash sitting around.

 

[HangTime]

Who wants these (or can even have them if they wanted) 4 bed huge houses way out of easy commuter range?

My parents whole village is like this. Before an average couple could easily end up in one. No more. I wouldn't be surprised if the mid tier 3-4 bed modest sized houses hold up best and these super houses fall most.

They aren't good for investment either.

People that don't require an easy commute. They'd rather have a huge 4 bed house than a flat or small house with an easy commute.
4 years ago, I would agree but if people are commuting 0-2 days a week instead of 4+ days a week they are more willing to compromise on commuting time.

I work in new build housing for most of the largest house builders on the country. They are all suffering badly with average drops of the marketing values of around 10%

Several house builders are also agreeing large investor sales to keep their sales turnover reasonable. Without those some of the month by month sale stats would be shocking.

I'm interested to hear more from an insider about how the pricing works on new builds. There seems to be a degree of mystery about it i.e. they will have headline prices they don't want to compromise by reducing but you never really know what they would actually accept. There are thousands of new houses being built near here (at least 5 different builders iirc) so there should be reasonable competition but I imagine they 'artificially' restrict supply, I like the idea of moving there to get a bigger house but I'd want a big discount of the headline price that would have been come up with in boom time.

 

[Jono8]

And this is the core issue. The housing market for years now has pushing the boundaries of what people can pay. Thats almost entirely due to low interest rates. Most people were OK but didn't have masses of wiggle room. Now many people will have 0.

Unfortunately unrestricted capitalism, with people/corporations/banks starting with a lot of capital will ALWAYS end up this way.

Our economy is literally just one big convoluted monopoly game, except most of us join in half way through a game with -1000 dollars to our name, whilst everyone else who has been playing for ages owns a hotel on every street.....

 

[fez]

Unfortunately unrestricted capitalism, with people/corporations/banks starting with a lot of capital will ALWAYS end up this way.

Our economy is literally just one big convoluted monopoly game, except most of us join in half way through a game with -1000 dollars to our name, whilst everyone else who has been playing for ages owns a hotel on every street.....

Its a pyramid scheme. It relies on an ever expanding money supply and an ever expanding pool of younger people to pay for the old. Now that first world populations are not growing, the whole thing will fall apart. The old have sucked all the money out of the system and want the young to pay for their retirement. People are also getting sick of being told they have little to look forward to but 50+ years of crap work and then a crap retirement as they watch their parents enjoy lavish retirements.

 

[413x]

People that don't require an easy commute. They'd rather have a huge 4 bed house than a flat or small house with an easy commute.
4 years ago, I would agree but if people are commuting 0-2 days a week instead of 4+ days a week they are more willing to compromise on commuting time.


I'm interested to hear more from an insider about how the pricing works on new builds. There seems to be a degree of mystery about it i.e. they will have headline prices they don't want to compromise by reducing but you never really know what they would actually accept. There are thousands of new houses being built near here (at least 5 different builders iirc) so there should be reasonable competition but I imagine they 'artificially' restrict supply, I like the idea of moving there to get a bigger house but I'd want a big discount of the headline price that would have been come up with in boom time.

Definitely feel a bit of this. Would be nice to have a 4 bed as we both work from home. And would be nice for gf not to have to work in the spare room.

Definitely don't want bigger than that

 

[HangTime]

I think the idea of making money off savings interest is more a spectrum than a black or white thing. The number of people looking to make any sort of serious money from it must be very small. But that's not to say it isn't something people want to do on a smaller scale:

• 15 years ago we were waiting to move house and I wanted our deposit to be earning whilst we were waiting without tying up the funds for ages. Stuck a big wedge in an Icelandic bank, I think it was pulling in about £400/month net interest. This wasn't a 'get rich quick' scheme or investment strategy, it was a 'maximise the return on that cash that I'm going to need access to pretty soon'.
  • To summarise some people want liquidity but they also want to see some return
• Elderly people often want low-risk (safe) investments at that stage of life, perhaps to build up an inheritance for their relatives. They don't want to take the chance on playing the long game with investments and get stung by the market just based on timing.
• Some people are just naturally risk averse or otherwise lacking in confidence to invest money in anything other than savings.

In terms of the idea of people saving up for something, in the current situation with inflation running at more than double gross interest on savings you need to be wary. Car prices for example have shot through the roof in recent years, so people will have been earning naff all interest until very recently yet that £25k motor now costs £30k.

 

[413x]

Its a pyramid scheme. It relies on an ever expanding money supply and an ever expanding pool of younger people to pay for the old. Now that first world populations are not growing, the whole thing will fall apart. The old have sucked all the money out of the system and want the young to pay for their retirement. People are also getting sick of being told they have little to look forward to but 50+ years of crap work and then a crap retirement as they watch their parents enjoy lavish retirements.

All pyramid schemes fail eventually.
Capitalism is the ultimate pyramid scheme and it's peaked.

So many real threats now. Our consumption is unsustainable. But it must continue to feed the pyramid.

One biggy is how far AI goes in making jobs redundant and breaking away from needing an ever bigger pile of young to pay for the old.

How this plays out is anyone's guess! Because birthrates are plummeting, global warming is getting serious. Then all the AI stuff thrown in to boot.


Going to be a crazy next 50 years.

 

[HungryHippos]

15 years ago we were waiting to move house and I wanted our deposit to be earning whilst we were waiting without tying up the funds for ages. Stuck a big wedge in an Icelandic bank, I think it was pulling in about £400/month net interest. This wasn't a 'get rich quick' scheme or investment strategy, it was a 'maximise the return on that cash that I'm going to need access to pretty soon'.

But these Icelandic banks collapsed due to unsustainable rates, so whilst not get rich quick, they were also not realistic sustainable options.