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Caveat Mortgagor

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Posts posted by Caveat Mortgagor

  1. APPLES!!!!!!!

    My point was that she had compared a ratio of 6-1 at peak with a current ratio of 3-1, and therefore assumed prices had already dropped by 50%.

    I pointed out that this was not the case, by explaining to her the difference between the two indexes, average total population multiples versus average actual house buyer ratios.


    I need to get myself a signature, beware the bears who can't read.... :P

    OK so lets recap................

    The original poster said ratios had been as high as 6-1.

    You stated they were now 3-1

    You are using different earning indices. You introduced the avge earnings of house buyers. Why would you do that? Surely there is more historical data for the dataset originally quoted which is based on mean avg male earnings.

    Please note that the mean avge male earnings is not the same as the average of the total population which is the term you seem to like slipping in!

    Go on. Go back and read your own exchanges, then read them again. If you still aren't sure feel free to ask me to explain them to you.

    New sig: Beware the Bull who will only read what he wants to read!

  2. No, I am aware of that and am comparing apples with apples, but this was in response to a poster that had confused the two measurements, and was therefore comparing apples with oranges.


    You picked up on a comment which made reference to the historical ratio of house prices and mean avge male earnings, you now want to imagine that we are back at the 3:1 ratio of 1995 by using a new denominator - the earnings of house buyers.

    You are not comapring apples with apples!

    I need to get myself a signature - beware the bull who lists status as 'Neither'

  3. Of course. But interest rates are - or according to the BoE's mandate - should be.

    And interest rates have a rather large impact on house prices. So they are linked.

    Nobody knows what is going to happen. However to give people an insight I would recommend having a look at what has happened to interest rates since 1971. In my opinion this period has shown one thing. A truly FIAT World currency system cannot be controlled with long term low interest rates. The only time the two have been combined has led to the system collapsing.

    Too much temptation to simply increase the money supply in this sort of system, with such low interest rates - leads to disaster. That has been shown pretty clearly.

    Anyone getting a mortgage today should be budgeting for double digit interest rates. Contingency. Whether they happen or not is questionable. However considering most mortgage are over 25 years ? I think the likelyhood of them NOT happening is about 1000-1.

    Unless of course you believe Broon. :lol:

    My response was directed at the OP. The OP was worried that the £25k savings would be eroded by inflation.

    The answer is simple. Inflation means his/her money will buy fewer chocolate bars, units of gas/electricity, tv's etc, but will not have any bearing on size of deposit for a future house purchase. The price of houses is what the OP needs to concentrate on. If they increase then the deposit is eroding. If house prices fall then the deposit is strengthening.

    There are of course many other factors to consider over the term of a mortgage, but on this occasion the OP was woreried about deposit erosion - my response was a direct answer on this subject.

  4. But what about the inflation issue ,i've read some of the threads and have a basic

    understanding ,will my £25k depreciate as fast as houseprices?

    Whether you should worry about inflations depends on what you intend to spend your £25k on.

    If you are thinking of spending it on tvs, dvd players and other essential items food energy etc that will go up in price then you have a dilemma.

    If you intend to use it as a deposit on a house and the purchase cost of that house is falling, does the price of fish really matter? Remember, house prices are not determined by inflation.

  5. The difference being you can always shop at Asda/Waitrose/Sainsburys etc so there's some external discipline keeping the service at least fairly good. Can't say the same thing about govt. services.

    Imagine what it would be like if there was just the one govt. owned and operated supermarket chain.

    You are quite right. My point was not to defend public sector workers by saying private sector workers are just as bad - but thinking about it, some are pretty awful.

    The biggest problem with dealing with a civil servant though is the stupid rules they have to obey that have desceneded from above. I often use the job centre to advertise. This used to be a fantastic resource. But over the last 2 years the powers that be have done their best to ensure that the power of your advert is diluted, the requirements are not clear and the the actual position on offer becomes more opaque. How on earth are you supposed to attract strong candidates when they put up a smokescreen for you??

    The people in the call centre are just puppets. There is no point complaining to them - they are nice enough and i guess just happy to go to work, do as they are told and not ask questions. They can never do anything about any request you make of them and will gladly refer you to their (equally powerless) manager!

    I once was so annoyed by the [email protected] of job centre plus that i e-mailed Lesley Straithie the chief executive outlining how a fantastic service has slowly been eroded and maybe in her new position she would like to understand the frustrations of the real world.

    I got not much more than an autogenerated e-mail which thanked me for my e-mail and that these things happen for a reason - and that the developments i had outlined as problems had to be viewed as improvements to their service!!!

  6. Has anyone else worked in a private company where there has been utter contempt for the customers?

    I am sure that collectively, setanta, talktalk and all the uk banks/ estate agencies and employment agencies employ a fair number of people.

    Oh, and dont forget the morons who work in shops for kids such as game / new look etc.

    And whilst we are on the topic - the standard of staff at my local Tesco is pretty pi55 poor as well. It seems the only qualification you need to work there is to be devoid of any desire for job satisfaction and to pass on to your customers the extent to which you despise having to work there.

  7. Regulation for the mortgage market.

    Maximum of 3.5 times single or 2.75 joint income!

    Whooooosh! What was that? Oh it was all your mortgage equity withdrawals suddenly becoming something you will be responsible for paying for. It will no longer be a massive burden to the poor hardworking family people who have yet to get a foothold on the bottom rung of an incredibly distorted housing ladder!

  8. Just a thought............

    Would it be worth having some "Henry Root" style fun by protesting about paying for the Tv license on the grounds of not wanting to fund The NuLabour Media Wing? What be the best impact and least hassle way of getting such a non-payment protest noticed by the rest of the media?

    Maybe start with a note to the BBC about insisting on returning some balance to their news / current affairs reporting!

    Any suggestions anyone.

  9. Ive often thought the lack of killer instinct on the opposition benches is because they dont want Brown to face a leadership battle. With Brown in charge there is no way NuLabour can win the next election.

    If Cameron wants to bide his time and wait for 1 more term of parliament then surely he wont be tory leader.

    And the situation that would be inherited in 2014/5 would be a lot worse then in 2010! Can you imagine giving Gordon another 4/5 years of spend / borrow to put everything right?

    Might be worth a poll - If Labour win the next General Election - How much do you think the national debt would be by the end of the next parliament? And what alternative uses could we find for that money?

  10. Sorry to pi55 on anyones bonfire, but the questioning technique is a bit wet. You got no more or less than the poor series of questions deserved.

    I am sure you know what question you wanted to ask - but you raise too many issues - and moan that the respondent has missed one of them!

    The bit about not bailing out BTL's which I believe to be the main thrust of your request takes up the first few words. There is then many more lines ( i wont bother counting) that waffle on about secondary issues such tax, HMRC, new legislation, removing legislation, prison etc.

    The truth is the questions they have answered are the questions presented in the bulk of your request.

    If you want a direct answer, ask a direct question - dont pad it out with loads of questions.

    You may have had reason to moan if you had stopped 13 words after "We the undersigned........."

  11. Followed by 13,000 employment tribunal cases for unfair dismissal?

    You can't sack someone unless you can prove misconduct (or at least if you do, you'll have to pay), or if their post becomes redundant, i.e. you no longer need the job done that they've been doing (in which case you have to pay, though usually a lot less than for an unfair dismissal).

    If these workers have permanent contracts, then they can't legally just be torn up. Unless the contracts specify that the employer can give notice of termination without having to have a reason (is such a contract legal under employment law?), the only way those contracts can be terminated is by dismissal for misconduct or redundancy, or if the employer goes bust, unless there's something I'm seriously misunderstanding.

    You touch on the topic I alluded to in a previous post.

    I think I am right in saying that Redundancy is viewed legally in pretty much the same terms as unfair dismissal. The redundancy payment is pretty much a compensation for unfair dismissal. This seems to be the laws way of allowing some flexibility to employers who need to re-structure their businesses - there is no comeback for the employee as long as the position really is REDUNDANT.

    So, the unfair dismissal is dealt with by redundancy payment. But if the employer re-hires for the same position within a timeframe (not sure how long) then another offence is committed.

    Usually companies will slightly change job titles to avoid expensive litigation by claiming the new post reflects the requirements of the re-structured business. But if everyone is made redundant, can the council claim that the needs of the organisation are massivley different without making significant changes to the services it gives to its city?

    Paying 13,000 lots of redundancy would be expensive enough. To handle the hundreds (maybe thousands) of claims from people who didnt re-apply for their job would be stratospheric.

    Though I am sure some slimy Lawyers wont be complaining.

  12. Being cynical I can envisage a legal test case coming out of this and pi55ing a load more council tax payers money away on an expensive defence - and even legal aid!

    There is bound to be some reptile legal expert with a view (an expensive view of course) that he could test the legality of making everyone redundant.

    If a company makes a few people redundant it is possible to rename their jobs and say that there has been some changes to job titles and responsibilities.

    If however, the council makes everyone redundant but still intends to supply the same services - does it face some action from some sharp practicing solicitor who wants to cane the taxpayer - sorry I mean prove a point of law and test the validity of making these redundancies??

    All it would need is for 2-300 people not to bother re-applying for their jobs and believing the fast talking legal expert that they could get money for nothing.

    Council employees going on strike could be just the tip of the iceberg.

    I am sure that the council will believe they are staying within the law, but am i right to be cynical and think someone is going to make a very expensive test of the validity of this?

  13. Every feature of a property has to be treated subjectively. That means what is a disadvantage to you may not be to someone else.

    Ive lost count of the number of houses I see advertised locally that proudly state that they have laminate flooring in the hall (which means that the original Minton tiled floor has either been covered over or dug up).

    Personally I would have preferred the original floor. But there's loads of people that have seen shows (by Beeney and the 2 scottish clowns that were obsessed with Purple) about improving your house to make it desireable.

    These people have their own views on what is desireable and what isn't. In the same way, I am sure that some people see speed bumps as a benefit. If it isn't for you then offer accordingly.

    If it doesn't matter to you, then you dont need to consider it.

    But if you are going to use it then blind them with science and state in your offer that tests prove that speed bumps knock wheels out of alignment and cause premature tyre wear. It might not be true, but why should the EA's have a monopoly on making things up?

  14. We are still in a hpc!

    Only two things matter - The scale and the speed of the crash.

    Many of the factors mentioned previously in this thread are designed by the government / VI's to lessen the size of the crash. In fact all they do is to slow it down and in some cases exacerbate the extent - see QE.

    The real crash is yet to happen. We are still on the precipice. The huge falls will happen this year though. Calling the exact magnitude and timing is almost impossible. But I will stick my neck out and say huge falls still to come - and the real excitement starts this summer!

    Squeal little piggy, squeal!!

  15. I wouldn't worry. I can see a lot of positives in this.

    The bulls would have us believe that there is a spring bounce, lots of activity etc. Agents tell us that offers are too low.

    In this case the completion was at a price lower than you offered.

    As long as anecdotes such as this are not reconcilable with bullish theories then I am happy!

    Could be the speed that the other party was able to proceed, could be gazundering or could be a back hander. Either way, the core message is that prices are heading one way - down!!

  16. Two FTBs in current situation:

    One needs 2.5x, the other needs 3,5x.

    The average is 3x, both get mortgages.

    Now the limit is 3x.

    One gets a mortgage, the other doesn't.


    But bring in a cap at 3x earnings and prices will fall.

    Your example suddenly becomes:-

    One need 2 x earnings

    The other needs 3 x earnings.

    Both get their house

    Both benefit from paying a lower price!

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