Mortgage Rate Rises

[glenimp617]

The world looks like it's gearing up for a massive war. I've no idea how this whole China/Taiwan thing is going to go, nor Russia, N. Korea or any other country who's getting a bit bored. Something is coming, I'm sure we can all feel it in the water.

What that means for fixing for 2yrs or 5yrs is any ones guess, but at least you know what you'll be paying without the worry.

 

[glenimp617]

If you rent all your life, what happens when you retire? Does your pension have to cover your rent payments with the way things are going, how can you afford to eat?

 

[glenimp617]

I listened to a bit of the MPC meeting. Sounded grim. Hope inflation will come down over next 2+years. But a lot remains unknown.

Looks like the projections are optimistic and there's no chance of it being better. But moderate chance of it being worse.

Best guess looked like 2-3pc by 2025ish on the graph

I think if you locked in at 3. anything, or even low 4. you are doing ok

Noticed there are a lot of southern folk moving more north, can't say I blame them

 

[glenimp617]

Which begs the question, who's moving down South to buy these houses

it used to be the Russians

 

[glenimp617]

What's happening in the market now? Fuel is going down in price, hopefully food , any news on mortgage rates ?or BoE apologising ?

Same as before, nobody knows. Nobody..... and if they tell you otherwise they're talking out their backsides.

I read an article only last week from experts saying they all thought with a high degree of confidence the base rate would stay where it is for quite a while, maybe go up a little more, but won't be coming down for a few years. Then just yesterday I was reading about the US debt hitting its ceiling which would trigger a UK rate decrease

There's so many different things going on around the world that anyone of them could swing it one way or the other.

If you are talking stock market, again, someone said to me go all in on UK FTSE100 but I take everything these days with a massive pinch of salt. Money under the bed I'm thinking.

 

[glenimp617]

Just seen house prices are hitting a new record high.

Cost of living crisis? Pfft!

Plenty of money about

 

[glenimp617]

House prices near me (east mids) are still going up.

 

[glenimp617]

they have pencilled in the 5% .. inflation not dropping because to many greedy company's ..

said on sky news this morning don't be surprised if rates hit 5.5%

feel slightly better fixing at 3.99% as even though it was only a few weeks ago, it felt like rates were coming down

 

[glenimp617]

^ Yeah paying £999 fee to get a tiny bit lower rate does not make sense. The lower rate won't pay back that £999 fee over the term as you'd be wanting to take a new deal after the 24 months anyway.

 

[glenimp617]

Please can someone get their crystal ball out and advise what sort of interest rate we'll be looking at in May 2025 when our 5 year fix comes to an end?

Thanks

PS I'll come back to this thread when the time comes and whoever guesses the closest rate will be the winner.

4.5%

 

[glenimp617]

It’s 2025, post war Britain is a grim place. Your bank’s head office was destroyed in The Blast. You’ve built yourself a lovely mud hut. Enjoy.

You have been warned about this by the temporal enforcement committee. Things need to play out as they have always done. If you don't remove your post you will be kicked off your assignment.

 

[glenimp617]

The rich gets richer.

Warren Buffet's advice in a time of financial crisis is to have lots of liquidity so that when you see a bargain, jump at it.

Yep, they suck all the wealth out of the economy.

 

[glenimp617]

Those who fixed on super cheap rates coming off later this year will be in for a shock I think.

Rates are averaging around the mid 4s at the minute which is bad enough, anything over 5 is very painful.

We were never lucky enough to secure a 1. something, and have a fairly low amount of borrowing....still a decent amount mind. Going from 2.2 to 3.9 was enough of a blow!

I wish I could put a healthy amount into overpayments each month, but we are desperate for a new bathroom and kitchen

 

[glenimp617]

Don't worry, the BoE will further increase rates because people are getting pay rises, below inflation. https://www.bbc.co.uk/news/business-65876822


"
UK wages have risen at their fastest rate in 20 years, excluding the pandemic, raising expectations that UK interest rates will have to rise.

Regular pay excluding bonuses increased by 7.2% in the three months to April, although it still lags behind inflation - the rate at which prices rise.
"

It puts the <5% pay rise the public sector got into perspective too.

in the last 10 years we've had two 2% payrises lol

 

[glenimp617]

The last few years have been crazy

House near us

Sold 2018 - £249
Sold 2022 - £350

 

[glenimp617]

Not sure if it's time to just rip the damn plaster off. Go with +1% increase, all these little measures haven't worked?

House prices are silly high though, and I think we all agree need to come down.

 

[glenimp617]

If we are looking at 5% today, what are the projected figures for a 2 year fix?

Santander are tracking very closely to base at the minute, but I don't know if that's because they have previous mortgage deals to sell off. I'd say if base rate is 5% then 2yr fixes will be around 5.8% ish

Who knows though

:edit: sorry, I was looking at 5yr fixes, changed to 5.8%

 

[glenimp617]

There is a massive crash in house prices coming.

People have been saying that for years though, yet all new developments continue to sell off plan. I think things need to get MUCH worse before people calm down. Far too many people happy to take on £200k/£300k/£400k debt just because "that's how much houses are these days"

That said, as I've gotten older my appetite for risk has declined so maybe I'm just an old git lol

 

[glenimp617]

Moving to Spain in October/November

Originally moved onto it when i could've got a rate of 1.89% fixed for 2 years, but didn't want to be locked in due to emigrating and having to pay the ERC. I could've paid it multiple times over in all the extra interest i've now paid

Can I come?

 

[glenimp617]

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