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Everything posted by ingermany
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Conservative Government This Year...
ingermany replied to Kazuya's topic in House prices and the economy
House price inflation was financed by excessive public spending, and it is only public spending that is preventing another masssive fall. The bank nationalisation programme, for instance, has now extended the public sector into running banks, the underwriting of personal debt, issuing more sub-prime mortgages and paying bankers bonuses. However, they've managed to cut probabtion services, which has obviously paid dividends in maintaining our reputation as a dangerous and violent nation. The new government will have zero room for manouver. It's like Obama after Bush. Who notices a difference? -
Halifax May Data Out 9am Today 4th June 2009
ingermany replied to crown's topic in House prices and the economy
Yep, can't understand it. Express is hailing the great new of rising prices. Oil also heading up at about 2% per day, so much bigger fuel and electric bills coming soon. More celebrations. -
"45% Of Mortgages Were Dodgy" Fsa
ingermany replied to eric pebble's topic in House prices and the economy
I don't disagree. This is crisis management, and the Govt have to do whatever they can. In a few years we'll know if they're correct. WE may or may not get Zimbabwe style inflation...hopefully not. I just think it's hard to compare this with the last crash. Then, bad debts were a private issue between individuals and their lenders. Now, the State is well and truly on the hook, because the unserviceable debts of individuals are so massive that the banks themselves have gone under and the Government is the only borrower big enough to take on the aggregate of bad debt. I think it is pretty well unprecedented for the debts of individuals to be dished out as a "collective" charge on all taxpayers, possibly for the next 2-3 generations, maybe longer. And I do think all Govt. policy: economy, defence, law and order, health, education, is now hostage to debt burden, caused by the banks' irresponsible lending, and the incompetence of the regulators. Who can tell what the consequences of this will be. -
Taleb Bets On Hyperinflation
ingermany replied to Zzzzzzzzzzzzzzzzzzzzzzzzzz's topic in House prices and the economy
Although Persimmon are offering to fix buyers up with a 100% BTL mortgage (95% loan/shared equity/5% gifted deposit), and arrange the first tennants. They are giving illustration of £550 in mortgage monthly and incoming rent of £800. Nothing to pay at all up front. Purchase price of £179K. I'm sure there's some small print, but my eyesight is crap, so I can't read it. What the hell, where do I sign? In any case you are probably right about BTL being as good a bet as anything. Cash/savings are disaster. Equities are risky. What do people do with their money to keep it relatively safe? Galling to admit it though. -
"45% Of Mortgages Were Dodgy" Fsa
ingermany replied to eric pebble's topic in House prices and the economy
Arrears are kept artificially low by lowering interest rates. A political decision to ignore inflation was taken. It has been running at 50-100% above the government's own target while rates were slashed. Appeasement of debtors has been the easy (?only) way out of the mess created by the housing bubble which was driven by uncontrolled lending. FSA/Govt and BoE did nothing to control credit (which was patently dished out by the trillion to those who could never be expected to repay it). Every part of government policy has now been subordinated to either mitigating or, more often, hiding the consequences. -
"45% Of Mortgages Were Dodgy" Fsa
ingermany replied to eric pebble's topic in House prices and the economy
Isn't this just because, by nationalizing and bailing out the banks, the Government has taken personal debts of individuals onto its own books and added them to the national debt? The PM has decided that there will be fewer reposessions, and because he (on our behalf) has bought all the banks he can make it so (at a ruinous cost to future generations). I don't think anything like this happened in the last crash. I remember the 80s and the privatization of BT and British Gas etc. Back then it would have been inconceivable that all but one of the High Street banks would become an arm of Government in the total control of the Labour Party. -
It's Not Happening Is It?
ingermany replied to The Masked Tulip's topic in House prices and the economy
asking prices: 360K down to 325, 325 down to 295..................... Not spectacular, and not a collapse, but universally down, and on good properties that would have seemed good value at initial listing in 2008. I guess 10-15% off in the last year. East Mids. The market has been artificially protected using taxpayers' money of course. The priced out FTBs are subsidising home-owners' mortgages in order to protect them from repo and keep supply restricted and prices up. It is probably the most immoral example of government financial aid. -
"45% Of Mortgages Were Dodgy" Fsa
ingermany replied to eric pebble's topic in House prices and the economy
It's a rapidly collapsing pyramid. The problem isn't one of fraud, but the fact that home-buyers and banks had to be dishonest, and had to arrange loans that were unaffordable at their inception. This was the only way of keeping house prices up and the only way of creating an illusion of economic growth. The whole banking, regulatory and legislative system colluded. I guess this is why government is pissing money away to help those stuck with massive mortgages on houses that are worth a fraction of the outstanding loan. And why they have nationalised the UK banking industry in an attempt to keep the fiasco going a little longer. This is akin to the Albanian pyramid scam collapse in the 1990s, but at least then the Albanian Govt. had the balls to allow the scams to fail. Here the government is desperately trying to compensate everyone and keep the party going. The cost will be ruinous -
Act Now: First Come First Reserved: Persimmon Homes
ingermany replied to ingermany's topic in House prices and the economy
To be fair, the builder is actually saying so, at least that's how it reads to me. Looks like 100% mortgage on BTL which I thought had stopped about 2 years ago..........: -
Act Now: First Come First Reserved: Persimmon Homes
ingermany replied to ingermany's topic in House prices and the economy
I would have thought that too, but that is what they are offering.............literally "we arrange your mortgage" and even odder "we instruct your solicitor"(note: your solicitor)...............both of those promises would send me running in the opposite direction, but the builder appears to be making that promise. The selling point is that you have zero outlay in money (or effort) and then get income from the house. The old addage of "if it seems too good to be true, it probably isn't" might apply, but I guess you would only learn that after you sign on the dotted line (especially if you take up the kind offer of their in-house solicitor). -
Act Now: First Come First Reserved: Persimmon Homes
ingermany replied to ingermany's topic in House prices and the economy
Sure, there's bound to be a catch................... but it looks like the builder can secure the 100% loan, and is obviously making pretty extravagant "predictions" on the investment potential. I'm not saying I'd be tempted, but I guess many will be. With no up front costs if someone offers you a scheme to put in £385 per month and get £800 back, you might be tempted. I did like the bit on the Ad that says ACT NOW: IT's FIRST COME FIRST RESERVED!! -
Persimmon Ad today: Invest in Your Future with a Buy to Rent Property in a British Army paper: " Look at This!-Outgoing £385pcm-incoming £800 pcm" The ad quotes a recent satisfied customer example: " We gave him: 25,995 discount of original price of 179995 5% deposit £1000 towards legal fees arranged the mortgage arranged a rental for £800 per month HE PAYS JUST £385 PER MONTH!" Zero deposit/100% mortgages for Buy to Let are being pushed. If the quoted example is correct it's easy to see why people would buy. Is this going on elsewhere?
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I remember in the 1960s, there used to huge organizations called Housing Authorities, which owned large swathes of urban Britain and rented the housing on them to social tenants. These houses were referred to as council houses, and the Authorities that owned them were massive tax-payer funded social welfare providers. These Authorities were largely dismantled under the 1979 Conservative government. They are now back, and we are calling them "banks".
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'one Million More To Lose Jobs'
ingermany replied to crash2006's topic in House prices and the economy
Has Eric developed Tourette's syndrome by any chance? edit to remove quote!! -
And another thing. Maybe someone should remind the whining "mortgage owners" that if the neighbouring homes had not been bought by Housing Associations (the Government) at inflated prices, the builder would have been forced to sell them at real market value to real FTBs. That would have meant 50-60% less than the mugs who bought in 2007 paid. The value of investments can go down as well as up. The scandal here is not that a few deluded snobs have some unwelcome chavvy neighbours. It is that the Government has intervened in the housing market to force prices up and stop then from dropping, thereby keeping FTBs priced out of home ownership.
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Good story. It demonstrates the often repeated mantra that a home should be a place to live, not an investment. These disgruntled buyers have lost absolutely nothing and have no cause to complain. They paid what they believed to be a fair price for a roof over their heads, and that is what the builder has provided. It is totally irrelevant to the buyers if the builder has provided a similar home to council tennants on the same street. If you buy a house it does not give you the right to control who lives in adjacent houses. If you want that right you need to buy the whole street. There are to many whiners and whingers in this country.
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Thanks for the details of the deal. Sounds like this is just a 20% surety. You get a loan, pay the interest and the bank holds onto 40k of your parents' money, just in case you miss some payments or the house value is deemed to have fallen. If either of these occur the bank help themselves to the money that's on charge. No legal process necessary, because you've agreed up front. The banks will want more of this.....no more worries about arrears and non-performing loans. They take 4 years' worth of interest up front, and "look after it" for you.
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I wonder what happens when the borrower defaults on payments. Can the lender recover arrears from the parents' account? Or can the borrower go the the govt rescue scheme from the beginning to get the interest covered without risking parents' capital? Does this put parents in a position where they actually have a share of the liability for the debt? I know I could read the T and Cs but I just can't be arsed.
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Eas Removing Properties From Rightmove
ingermany replied to kool4caats's topic in House prices and the economy
I guess it's stating the obvious, but the Agents and Rightmove want to ensure that they control what information is available to a potential buyer. They would obviously want to hide a hideous history of abortive sales and price reductions that would identify a "desperate seller". I guess it's a legitimate tactic. RM isn't there to tell the truth. It's there to sell property. Perception is EA minds is that a history of price reductions is not something to attract the right kind of buyers. It's seen as an open invitation to cheeky bidders wanting another 20% reduction. RM has to sell the myth of green shoots, confident sellers, and an iminent resumption of rising prices. -
More Financially Illiterate Advice From The Bbc
ingermany replied to FrozenOut's topic in House prices and the economy
I used to think that as well. I would not want to be indebted beyond my means. However, the government has given a whopping green light to absolving debts for individuals and collectivising the liability to repay. I have no mortgage and no loans, but I "owe" about a 25K share of others' debts that the government has assumed on my behalf. Those who borrowed the money have used it, spent it, benefitted from it. The paying back element has been passed on to the rest of us. And, to exacerbate matters the government is lending more and more through its nationalised banks. There may be consequences to IVA/bankruptcy, but none of the consequences actually involve repaying the debts. House prices could not have reached the heights of 2007 without irresponsible borrowing. More irresponsible borrowing is needed to prevent a rout. This means that there will continue to be a policy by government of adopting a permissive attitude to debt default. In other words, yes you can borrow excessively, and, no, you don't need to repay it. It can be added to the taxpayers' bill. -
More Financially Illiterate Advice From The Bbc
ingermany replied to FrozenOut's topic in House prices and the economy
No. you're missing the point. You never have to repay the capital. You can just default. The bank then has the debt, and when the bank collapses because everyone has followed this behaviour, the government picks up the cost. Not sure what happens when the government collapses. But you definitely do not have to repay the capital. In fact, if you have any financial difficulties at all the government will also pay the interest, so the real cost of the 150K "loan" could be zero. To quote Mark Knopffler....."money for nothing". -
Number Of Uk Houses For Sale Down 70%
ingermany replied to thirdwave's topic in House prices and the economy
Certainly seems to reflect situation where I live. I guess the result of outright government subsidies targeted at homeowners/mortgage payers. But, how much longer can the country afford to prop up one section of the population at the expense of everything else? On news last night, Corus Teesside about to close....the end of Steel making on the Tees and massive job losses. We're losing capacity to make and sell stuff, in favour of smoke and mirrors ponzi wealth financed by more and more public spending. FT has quoted that the "housing market is the engine of the British economy". It's as if on the "The Apprentice" you have a task to sell 100 items valued at £100 each. You fail miserably to sell anything but claim victory in the boardroom because you've just decided to re-value the unsold items at £200 a piece. Hey-presto, 100K profit Sir Alan. Surely someone will take control and stop the madness. The IMF perhaps? -
Why "bite your hand off" to pay for the priviledge of buying something that is falling in value? I can't understand it. Although it is possibly true.