Tuesday, Jan 23, 2007
SVRs at 7.44 percent! Not a pretty sight ;¬(
Firstrung: Natwest and RBS increase their standard variable rates up to 7.44 percent
NatWest today announced that its Standard Variable Mortgage Rate would increase by 0.30 per cent to 7.44 per cent. The Royal Bank of Scotland today announced that its Standard Variable Mortgage Rate would increase by 0.30 per cent to 7.44 per cent
Posted by converted lurker @ 09:05 PM (174 views) Add Comment
11 Comments
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1. sovietuk said...
The grim reaper is on his way
2. This comment has been removed as it was found to be in breach of our Blog Policies.
3. Micthemike said...
maybe im being a bit simplistic here if the the japanese rates are currently .40% and presumably the big financial institutions have access to this is it no wonder the banks are falling over themselves to sell mortgages. i presume there are monetary controls for individuals to borrow fromthis country what a pity altho probably the rates are different for individuals
4. headmelter said...
Tick Tock......
5. Nohpc said...
Anybody on an SVR is probably not struggling with their payments otherwise they woud have switched long ago. There are still plenty of competitive rates on the market much much cheaper than this and I cannot believe anybody would accept a rate anywhere close to this. Usually they put their SVR up so they can offer attractive discount rates without going too low. I also see interest rates staying around their current level maybe gaining and dipping a bit over the year so no worries there really to be honest :) You still cannot really get money cheaper than with your mortgage :)
6. bidin'matime said...
‘No hpc’ - keep talking, you might even end up believing yourself. Eventually there will be nowhere left to run...
About 5 years ago when I looked into BTL, I was thinking long-term and set a minimum yield I would accept of 8%. As a result, I didn’t buy anywhere. Of course, had I been thinking short-term, I might have taken a gamble on there being a housing bubble and made a killing, but I would have been plagued by the question of when to get out. But now we are moving back into the real world, my 8% target yield seems wholly justified and all those who ‘invested’ at lower yields (and haven’t sold out) will live to regret it.
7. p. o. o. r said...
This does not surprise me, and I believe that there will be several more increases to come over the next 18 months. Whilst some people will change their mortgage a vast majority will just foolishly accept the increase, even if they are struggling to keep up with the payments - for those who are maybe already a month or two in arrears it is more difficult for them to be approved for another mortgage, so they have no choice other than to accept the increase.
8. tyrellcorporation said...
NoHPC, You assume people can move mortgages easily but the lenders are wise to this and as many recent reports have shown, they have punitive opt-outs in place to minimise fluidity. I really don't think moving mortgage is an option for many as stumping up a grand to get out is just not going to happen - unless of course you borrow that grand from someone else...
...That would mean borrowing to move your debt...doh!
9. bidin'matime said...
"...That would mean borrowing to move your debt...doh!"
Happens all the time...
10. talking rot said...
Given the closeness of the call, (5:4 in favour of the rise), and the recent comments of the Gov'n BoE, I think NoHPC is right. Inflation will rise and then fall in mid-2007 so interest rates will fall. Interest rates haven't yet reached a level which pushes people into a forced sales situation. (i.e. one where they are forced to accept a price lower then they would like). Until this happens, there will not be a HPC CAUSED BY INTEREST RATE RISES.
I am now convinved there will not a single cause to the next HPC. Most likely it will be a combination of:
1) Limited rises in interest rates
2) Falling Ł pushing up price of imports
3) Unemployment rises (not enough yet to matter)
4) Increased taxation
5) Higher non-discretionary bills
6) Major slow-down in the US.
Points 1 to 6 will have to hit at the same time - and it isn't likely to happen.
11. dohousescrashinthewoods said...
The bigger the bubble, the less pressure it takes to burst it. Given that we have a global phenomenon on a scale arguably not seen before there is serious risk.
The housing market takes a long time to react and in the meantime we are boiled frogs, starting to think this is normal (won't pop).
Has any bubble ever been followed by a soft landing?
The US seems to say every month or so that the worst has passed. Each time they are wrong. Stuff isn't holding together (cf Labour party's shambles for an echo of this) 9 months ago, no one would have taken you soriously if you'd suggested 5.25% interest rates. Bulls wold confidently assert from a position of existence proof that there was no way it could happen. Even 4.75 seemed an outside punt and when it happened, bulls said it wouldn't go higher. Things are changing, gradually. Stuff is not going quite to plan and as one thing gets cleared up (e.g. energy prices out of the CPI annual) other things start falling apart (e.g. military action in Iran, police investigating government, China switching reserves, who knows what else we can't imagine at this point)
There was a time it all seemed to be going right, then a time of papering over the cracks, then desperately holding it together and now the wheels are coming off. One or two get put back on and another three fall off. I don't want to sound like a vague doom-monger but, overall, momentum has been gathering over the last 9 months. Remember how (relatively) smoothly everything was running back in Arpil/May 06?