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House Price Crash Forum

r thritis

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Everything posted by r thritis

  1. Would you have similar objections to the filing cabinet that holds your paper records being built overseas?
  2. There is a curry house near us that is owned and staffed exclusively by ... you've guessed it... Indians! It's outrageous. Bring back those British made popadoms I say.
  3. Any money pumped into the foot of the ladder goes straight into the developer's pocket. If there is additional money available in the form of shared ownership schemes, sales prices instantly adjust to swallow up the additional money. Gordon is an ignorant tit.
  4. I love that word 'renegotiate'. It carries the implication that you will be able to say to the lenders, "I'll tell you what, - you want 7 percent, how about I'll give you 3 percent?..."
  5. If you take these long period repayment loans to their logical conclusion though, you arrive at the interest only loan.
  6. Yes but... Where are you going to experience the better quality of life? In the palacial 700k property or in the dingy 300k terrace. Ok I exaggerate, but this is exactly the message put out on those property porn shows.
  7. Interesting article here about the exploitation by companies like Fairpack. http://www.moneyweek.com/file/20384/how-ch...y-ignorant.html Vulnerable people really need to be protected from this sort of exploitation. The industry really needs to be regulated to prevent people from being taken in by these schemes. I just hate the way that so many organisations are constantly seeking ways to rip you off. They are given free-reign to do this in the name of free enterprise - but this is just not a good enough reason to allow these con-artists to exploit people who are not financially savvy enough to understand. (Edit for typo)
  8. "Paul used to club fluffy animals with my leg." Heather Mills reveals exclusively.
  9. I hate premium rate numbers. I don't see why the world needs them. Invariably, they are a method by which the devious and unscrupulous can extract money from the vulnerable. This applies equally to the BBC's strictly dumb dancing (worst of the lot as it cynically maximises its profit by giving a tiny percentage to Children in need), and Ant and Dec's Celebrity bug-eating contest, as it does to some shisters in Belize. After the revolution, all premium rate numbers will be banned and all who profitted from them will be shot, starting with Simon Cowell.
  10. True - but even last time around, if you bought in 1990 it took about 10 years for "inflation to catch up". Some people just can't wait that long. As for "Negative equity wont trigger a house price crash". I think you have the cause and effect mixed up here....
  11. Yep - I was there last time around. Basically - the bank doesn't really have the visibility that you are in negative equity, so if you sell it is up to you to settle the outstanding mortgage. You have the alternative of simply handing them the keys (voluntary reposession) - and I think you can do this without having to go bankrupt. Presumably though your credit rating is affected if you do this. Personally, I was leaving the country when I sold up and even though I could have walked away, I chose to take out a loan from the same lender to cover the amount of the negative equity (about 10 grand). They are invariably happy to make this loan as it means they get their money back. Generally though, you are stuffed. You cant trade up as you would need a 120% mortgage (or whatever) to do so and suddenly, that nice lender who was being so generous by lending you 5 times your salary doesn't want to know. So you have to stay put, paying a huge mortgage that consumes most of your salary while you watch people around you buying places the same as yours for a much lower price. That BMW X5 that you bought on mew is now rusting in the drive and worth next to nothing, while that upstart next door drives a Merc SLK and holidays in the Caribbean every year - his mortgage is a fraction of yours. Ten miserable years later, your house is finally worth what you paid for it and you can finally move. The house you buy is now rocketing up in value. Some miserable people on an internet forum are predicting that prices may crash again, but this couldn't happen could it? Prices only ever go up.
  12. I returned to the UK 5 years ago after an extended period abroad. When I arrived back it was like being back on the prehistoric earth in the Douglas Adams hitchhiker books. In the book, the new residents of the planet had adopted the leaf as their unit of currency. It didn't matter to them that they didn't actually produce anything, they were all just immensely happy, because they had piles and piles of leaves and all felt immensely rich. However, they were starting to experience a bit of an inflation problem which they attempted to tackle by burning all the forests... When I got back to the UK, people were flogging their houses to each other at forever more and more ludicrous prices. Much of the manufacturing in the country had died out, but it didn't seem to matter. Everyone was very very rich as they now owned a house, the same house they had before, but now, a much more valuable house. They found that if they all kept telling each other that their house was now worth twice as much as last year, they could go out and borrow more and more money, making themselves richer and richer each year. It got to the point where more than 10% of the economy was funded by money aquired in this way. Funnily enough, neither the Chancellor nor the Bank of England seemed to notice anything funny was going on. Then one day, they started to have a bit of an inflation problem...
  13. Just watched it. The blind faith these people have in the housing market never fails to amaze me - its like watching members of a religious cult. When its pointed out that there is a chance that prices will fall, they seem to glaze over and repeat some sort of standard 'prices only ever go up' line. That amount of debt is staggering. To take on a loan of 5x your income to buy some grotty flat is unbelievable. Haven't they done the maths? I hope they are good friends because they have effectively made themselves cell-mates for the next decade.
  14. No you dont understand - the prediction is highly significant because it is the first forecast on whether prices will go up or down next year. It says so in the article.
  15. Actually - not true. Only the Bulls can be proved wrong (i.e. if there were to be a significant crash). If prices just to continue to rise, you can never be sure that the crash isn't just around the corner....
  16. Stamp duty threasholds should not be increased in line with house prices, just in line with the general cost of living / wages. If you choose to pay a ludicrous price for a house you also choose to pay the ludicrous amount of stamp duty that goes with it.
  17. Wehe - even I can do that one! It means that a large negative from last August has fallen out of the yoy calculation.
  18. Very valid and important point. Affordability is the reason we have got into the mess we're in now. Lenders and borrowers have confused low interest rates with cheap money, in fact you hear the 2 terms used interchangeably. What is important is the interest rate relative to wage inflation. The fundamental problem with loans is that they are divided up into equal repayments over the term (making adjustments now and then for variable interest rates). In times of high inflation, the payments start high but decrease rapidly from year to year in real terms. In times of low inflation, they start low but diminish more slowly. But under either scenario, you will end up paying pretty much the same in real terms over the life of the repayments. Unfortunately this 'low-start' effect has enabled people to borrow ludicrous amounts, because they can afford the monthly payment at the outset, and the illusion of cheap money. This huge injection of money into the economy is inflationary, leading to higher interest rates (this is where we are now) and the enevitable bust cycle as the economy dries up loans are defaulted, etc. The way to avoid the boom-bust cycle is to link monthly loan repayments to the current interest rate or the CPI, so they diminish by the same amount in real terms from year to year, regardless of whether we are in a high or low interest rate paradigm. This is the fundamental change Gordon Brown's successor must bring about if we really want to rid ourselves of boom-bust. GB himself will by then have been confined to the history books as the most incompetent chancellor in history.
  19. You didn't think there was anything strange about burning an effegy of the pope then?
  20. OK trumpet blowing time. It took three weeks for this prediction to come true! Thankyou Bradford and Bingley. http://observer.guardian.co.uk/cash/story/0,,1799997,00.html
  21. Is there any way the HIP could be avoided by the seller or EA advertising the property pre-hip, with some clever wording like "Coming to the market soon - 3-bed semi, etc etc, expected asking price £350,000" Get the idea? At what point in law is the property actually being offered for sale?
  22. I wonder.... You're right, the lender would be vulnerable in the short term, but if they could target this type of mortgage at say, young couples with a steady income, they may be able to make it pay. Lets hope not.
  23. As long as the lenders lend, the muppets will borrow. The interest only mortgage was a master stroke on their part, allowing the gullable to borrow astronomical amounts, and still make the monthly payments, whilst the lender creams off the profit into the forseeable future. Here's a prediction. It is just a matter of time now before one of the more creative lenders offers a 'Low start interest only mortgage'. It will load the interest repayments towards the end of the term, thereby increasing affordability at the start, allowing even more monsterous amounts to be lent. It will be dressed up as a measure to help first-time buyers 'get on the ladder'.
  24. It beggars belief that they would look to this sector to flog mortgages. I guess they've done the maths and figure that if they charge a certain rate and cover their ass with a suitable deposit, they can exploit this sector to deliver a profit. There's no consideration of the morality of doing this, i.e. the misery that will result from reposessions, lost deposits etc.
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