Mortgage Rate Rises

neocon said:
Some analysts predicting 40% drop in house prices
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To be honest, I really am not that clued up about the economy, state of the housing market etc, but it feels like houses have gotten far too expensive.

For the last few years, I've struggled to understand exactly how the average earner is able to afford £250-300k on a house, other than to indebt themselves up to the eyeballs..
 
Over what term? I though lowering stamp duty had the opposite effect, or is that just because the other changes have a much greater impact?
 
Screeeech said:
To be honest, I really am not that clued up about the economy, state of the housing market etc, but it feels like houses have gotten far too expensive.

For the last few years, I've struggled to understand exactly how the average earner is able to afford £250-300k on a house, other than to indebt themselves up to the eyeballs..
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My house has gone from 130 to 250k in 8 years... 3 bed semi in Yorkshire. Madness
 
Martini1991 said:
Hello a generation of mortgage prisoners lol
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It would never happen but a huge number of people would simply default, hand the keys to the bank and declare bankruptcy.

There seemed to be a small spate of it when all the Grenfell fallout was happening and people had bought on super high LTV and were being charged insane fees for walking fire patrols, flat values with the bad cladding fell through the floor and costs to replace were high. People just noped out.

Imagine buying a house with a 5% deposit and it dropping to being worth 60% of what you paid. For most people, unless they bought in the last 5 years or had a stoking deposit they would probably be better off declaring bankruptcy.

As I say, it will never happen.

20% maybe.

Our house has gone from £460k to close to ~£580k in a little over 3.5 years. Around 25%. I would be more than happy if house prices dropped back to that level.
 
40pc does seem High.
That would put me negative.
Not negative enough to declare bankruptcy (unless job loss)

But I'd expect that rich investors would be in to vacuum up before that?

20pc seems a safe middle ground. After all, wouldn't that simply be going back to pre covid?
 
413x said:
20pc seems a safe middle ground. After all, wouldn't that simply be going back to pre covid?
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I could see 20-25% but even that seems unlikely. The Tories will do everything in their power to avoid it.
 
413x said:
40pc does seem High.
That would put me negative.
Not negative enough to declare bankruptcy (unless job loss)

But I'd expect that rich investors would be in to vacuum up before that?

20pc seems a safe middle ground. After all, wouldn't that simply be going back to pre covid?
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IIRC 2007/8 crisis was about 20% so in extreme events I'd agree.

Back then though it was lack of lending not cost of borrowing that was the problem.
 
CapitalOne said:
IIRC 2007/8 crisis was about 20% so in extreme events I'd agree.

Back then though it was lack of lending not cost of borrowing that was the problem.
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20 percent would be a disaster only for people who bought at the covid peak on 2yr fixes. Everyone else would probably be OK if rates came down or stabilised here.

I guess there are so many unknowns with kami-kwasi at the helm that any long term guesses are simply that. Guesses.

You can guarantee rates rising in next 12 months. But you can't even say for sure truss and kwasi will be here that long.

It makes planning life incredibly difficult


As someone who wants to move once more, a downturn in house prices would be no bad thing. Really, I don't understand why British are so obsessed at wanting house prices to increase?

Enough people want to move/get on the ladder that ever increasing prices aren't great.
 
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_Jimlad_ said:
just signed on 5 years at 3.60% starting at the end of the year.

i may regret the term length, but at least i know what i am paying.
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I fixed for 7 years at 3.4% and don't regret it at all. Means rates are controlled for the length of our mortgage pretty much. Historically <4% isnt bad and rates could be stay high for many years from here.
 
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I have to say, this can't carry on forever. House prices must come down. If first time buyers can't get on the ladder, nobody higher up can move.

It will be painful for those who bought in the last few years, but they must come down to sensible levels as wages aren't going up enough.
 
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TheOracle said:
I have to say, this can't carry on forever. House prices must come down. If first time buyers can't get on the ladder, nobody higher up can move.

It will be painful for those who bought in the last few years, but they must come down to sensible levels as wages aren't going up enough.
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Well i hope it dont come down much as people who bought recently suffer from negetive equitty,

it would be nice if the house prices just froze for the next 5 years!
 
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