adarmo

Standard recession. What happened in the last recession (the biggest in 80 years)? Options if you have a mortgage include payment holidays and rolling up on interest. If you're renting I'm not sure what you're able to do other than stop paying and wait for eviction or take housing benefit and move to some manky apartment.

That's the point in an inflationary environment though. Their incomes are not fixed and get inflated too. I'm happy for the prices of everything to double or treble as I'm pretty sure my income will keep pace. The thing that is fixed though is my mortgage debt. Who was laughing through the 1970s?

I'm not even sure what the Tories are these day tbh. It seems like the socialist element is missing too unless you're a boomer in which case you're getting everything regardless of contribution.

Righto. When has such a scenario ever unfolded? You state borrowers are in trouble but then state the choice is inflation OR interest rates at 8%. If the former is taken then most borrowers are laughing aren't they? On the borrowers adding up point every chartered accountant I know owns a house. Two have just taken on much bigger mortgages to trade up having been previously mortgage free.

It's more a fraud than a handout isn't it though? How do you view the other 90% of that funding? It all came about because of a social support. The capitalist solution would've been to crack on regardless, no handouts, no grants, no loans and no furlough. No government intervention at all. Frankly I would have preferred this option. Meanwhile in China continued lockdowns...... In most of Europe with more socialist arrangements (excluding Sweden) there are still restrictions.

Russia is doing such an excellent job in Ukraine

Debt of course.

Time for some monetary help..............

Not sure I follow your numbers. House worth £300K, for you to be £40K better off after 4 years you need the house to fall by £80k? A 1% increase in interest rates somehow results in a 17% reduction in the amount you can borrow? How do you know this? Who is pricing a 25% fall in house prices over the next 4 years? Here's teh thing, you buy a house today instead of renting and those monthly payments are overwhelming a net zero wealth transfer. You are using savings to clear debt, each mortgage payment is mostly a payment to yourself. At 2% your interest is £4K year so after four years £16K versus 4 years renting at £10k/yr = £40k. Right there both interest and rent are net expenses so you're £26K better off if prices don't move. Perhaps you're well outside of the South East? There were some instances where prices fell very dramatically in 2008 but these tended to be newbuild vanity properties that were horrendously overpriced to start with.... well outside of the local pricing and they fell by significant amounts. That was the biggest recession in 80 years. Do you think this next recession, when it comes, will be bigger? The next General Election is due in two years time. Do you think, politically at least, it's acceptable to let things fall or do you think the Tories will throw everything they've got at ensuring prices stay level or go up to ensure an election win in 2024?

Things would have to be pretty bad before I gave up cheese.

It seems you think I'm throwing insults? I'm sorry if you feel that way. You are now arguing that real wages haven't increase but everyone just borrowed money to buy all their stuff instead? Actually, I am more than aware house prices are the result of the supply and demand of cheap and easy credit. You may, or may not, have seen my other posts arguing there's not a shortage of houses in the UK. It's an allocation issue. Back to the question. Have real incomes risen or fallen in the last 30 years?

How do you know this? Increasingly you are typing stuff that's a gut feel. That's fine. I've rented previously, actually my last landlord was a lovely guy with excellent reputation locally. Guess what? Rent increased each year. Could negotiate and it was minimal, but it went up. Guess what has happened to the interest on my mortgage debt (the renting from the bank bit) since taking out the mortgage? The reason for the debt is to buy a house. The reason for 35 years is this 'why would you pay it back early when you can borrow at 1%, deposit at 1.5% and watch inflation burn that debt at 8% a year. What's the reason for not doing that?

You're right. If rates go to 2% (they already are for mortgages) people will suddenly not need a place to live. It's magic! Do you think people can only afford to pay their mortgages at todays rates and were not stress tested by their mortgage provider? Social Just Warrior's assessment that millions will go bankrupt is simply untrue. Rates go to 2%, do you think you'll be better off with all your money in cash and paying rent? Perhaps you do.

Now you're making up my feelings. How exactly am I scared? It seems you think I'm expecting nothing adverse to happen over the next 5 years? You'd be an idiot to assume that. Here's the thing, I could lose my job tomorrow, not work for 3 years and still continue living as I do today from my savings because my housing costs are fixed, unlike being a tenant.

I lived in the 1990s. You've given nothing back to demonstrate any of your counter non-arguments. You refuse to accept real incomes rise over time. Probably why you'll be renting forever. If you're a grown up in the 1990s and have such a gift of foresight why don't you own a house?

Gas prices are down two thirds since end of Feb..... Those increases are short term only. Either the Russia/Ukraine war is settled and things get back to normal (or Putin dies and his successor comes out all apologetic) or other supplies will be linked up and on stream. I get what you're saying but it's not likely to be the case. Aside from inflation people have the option of trading down. Shop at Tesco not Waitrose, by own brand not premium, cut out alcohol etc.

Sadly it's been that way for the last 50 years. You might argue there was a very brief window in 2009, maybe early 1990s but that is it. Again, falling real value of the pound, rising real value of incomes......... You may be interested to know how many people went bankrupt in the last few years. to get into the millions (2M or higher as a plural) you'd need a 200 fold increase in applications. If things get so bad that a millions are about to go bankrupt I wonder what will happen to interest rates.......

You still haven't answered the question on real incomes. So....... what is it? What assumptions? The world not ending? It seems like the counter side of your argument must be that someone not buying would also be making a ton of assumptions about the future too? That's all people can do about the future though isn't it? So I guess in one sense anyone making any future plans is also just making assumptions. That's fine. Just assess the risk of those assumptions. Like the risk of sitting on your hands and waiting and seeing is: reduced potential mortgage term as you age rising real house prices falling real value of your deposit renting and supporting the BTL industry I'm sure I'll be just fine but I appreciate the nice wishes. I wish the same for you too. I'm trying to argue with you, I'm trying to help you.

I'm certainly laughing

No, they really wont. Millions will not go bankrupt. IRs wont hit 10% unless inflation is much, much higher and if that's the case the mortgage debt will be quickly eroded (just like the 1970s). Then there's the easy vote winning policies, funding for mortgages, MIRAS etc. You can jack interest rates while still printing money and giving relief to mortgage holders. Your 'prediction' is fantasy. The loser position will be non asset owning cash holding wannabe first time buyers, sadly.

Haha, I had a similar issue. Android version 8.0 or higher required.

See here. You can always move it if someone else has a better offer. https://www.chase.co.uk/gb/en/product/chase-saver-account/

Yup. Inflation bubbling at 6-8%. Even at 5% you're winning. If the best mortgage rate I could get when I come off my fixed term is 5% then my monthly payments would increase by about £600 (circa 60%). This ignores any over payments or additional payments I might make if this were the case to minimise that. However, this year's salary rise increased my take-home by more than £300 (or would have done had I not upped my pension contributions to ensure my total tax liability this year is lower than last years - screw the NI rise!). There are 4 more annual increases between now and my remortgage so I do not expect my mortgage increase in 4.5 years to set me going backwards in terms of real disposable income.

Chase bank are offering 1.5% on their 'app only' account. No min or max deposit and anytime withdrawals. That's actually already higher than my mortgage rate.

Yep, will also erode the debt piles of many over that time period too