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Boom'n'Bust

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  1. http://www.theaustralian.news.com.au/story...9-25658,00.html Slide to negative equity Anthony Klan September 06, 2006 THE scourge of negative equity has spread to Brisbane as the property downturn continues to slug investors and the lower end of the housing market, but the Perth market continues to fire. According to Australia's largest mortgage broker, Australian Finance Group, falling property values in parts of Brisbane has led to an increase in the number of owners with mortgages bigger than the value of their homes. "In some of the outer Brisbane suburbs we are seeing valuations for house-and-land packages purchased mainly for investment purposes falling short of purchase prices," AFG executive director Malcolm Watkins said. AFG said some new construction projects in that state were being independently valued at 20 per cent below asking prices. "That's your first classic sign that things are slowing right off and people are becoming far more cautious," Mr Watkins said. Prices were also coming under pressure in parts of Melbourne with valuations of properties "in many cases showing no growth or declining values during the past 12 to 24 months". However, it is Sydney where prices have fallen the most, with the highest proportion of families facing the prospect of negative equity. "Many owner-occupiers, seeking to refinance their homes, are being disappointed by the lower-than-expected valuations being achieved," Mr Watkins said. "If larger numbers of owners are forced to sell, this will trigger even greater declines, affecting more property values." Unit developments at Green Square in Sydney's inner southwest, and outer northern suburbs such as Waitara and Hornsby, had been hardest hit by the downturn. Apartment values had fallen by as much as 20 per cent in Green Square, where developers were opting to rent out apartments rather than sell them for fear of further price falls. Properties at the lower end of the market were worst affected during the year, with values at the top end of market continuing to surge. AFG said the average Australian mortgage had grown to $306,783. Perth continued to rocket in the year to August, with average mortgages in Western Australia now the second highest in the country at $340,531. This is above both Queensland at $288,823, and Victoria at $283,717. Average mortgages in Western Australia were behind those in NSW, which averaged $377,068. Despite continued weakness in the market there had been a strong increase in the proportion of investors in the year to June. AFG said 31.6 per cent of borrowers in August were investors, up 23.4 per cent on August last year. Housing Industry of Australia chief economist Harley Dale said some of that increased activity had probably been fuelled by expectations of rising rents. "The rental market has been tight for some time now and that's starting to feed through to strong rental growth," Mr Dale said. "Also, a little bit of the shine has come off equity markets, so some people may be starting to feel there could be a switch back from stocks to the property market over the next two or three years." He said the total level of residential property investment was still about 12 per cent below the peak of the market in late 2003.
  2. Overvalued' housing market to cool next year http://investing.reuters.co.uk/news/articl...OUSING-POLL.xml
  3. hi there mate, I asked him and he said its Band B at the moment. This band values he house between £40k-£60k, which he's happy with as it keeps he c-tax down. But he's concerned that the new value maybe a lot higher as house prices have risen and if his house was valued at £130k, he'd be f**ked!!! Any advice?
  4. Hello, I need some advice for a friend who's bought a property a year ago. He purchased it for approximately £130,000, but all along his council tax has been low as his last council tax valuation in 1993 was only in the region of £40,000 - £60,000. His situation is that he has received a letter from council asking for permission to revalue his property from the outside, in order for them to calculate the help he can get with his rebate etc. But in my opinion its just so that they can raise his council tax band. My questions are:- 1. Can he decline permission to revalue the property? 2. Will they not pay him any rebate if he declines? 3. If he's okay to decline, then what good reason can he give as to why he's declining them? 4. Has anyone else been through the same situation and if so, what did you say? Thanks for your advice BooM-BusT!
  5. http://www.bloomberg.com/apps/news?pid=100...FuyKA0&refer=uk U.K. Mortgage Approvals Fall, Signaling Cooling Housing Market
  6. I might as well go to another forum, as no one seems to know the answers...bye
  7. some people don't bother as its the attitude "why waste money, when I know my job is safe" Anyway isn't this going a bit off-topic...couldn't someone help me answer the questions i asked?
  8. lol!!! Now I shouldn't be laughing..sorry..okay lets get serious mate...we are going off-topic here and i still need a few answers and would be grateful if anyone can help...here's the unanswered and a few more questions once again:- 1. If he put in 20k after 2yrs into his IO mortgage, and lets say that the interest rate at that time is still 4.79%, would this actually bring his mortgage payments down to approx £240pm or would they still remain at £320 for the entire term of his IO mortgage? 2. Once his 2yr fixed period expires, should he 1st pay of the 20k and then fix it again for a lengthier period (5yr or 10yr?) or do something different? 3. How does he bring his mortgage monthly's down quickly on an IO mortgage? 4. Will he be better off changing back to REPAYMENT after the 2yr IO fixed mortgage finishes? Thanks
  9. Thats not true mate..the DWP do pay the mortgage, but not for the first 10 months after you lose a job and here's a link from a law website:- http://www.compactlaw.co.uk/free_legal_inf...g/privhf13.html You may also be entitled to help from the DSS with payment of the mortgage interest if you are out of work or on a low income.
  10. Thank You for your fast reply guys!!! Its really appreciated!!! @ terrified - I'm sorry mate, but i think you misunderstood my question, which was that do DSS only help people struggling on REPAYMENT mortgages or do they help those who have taken out an INTEREST-ONLY mortgage too? He will be taking out cover for income protection as its not official about job losses. @ www - LOL! I'm sorry too mate, but i think you also misunderstood my question, which was that if he put in 20k after 2yrs into his IO mortgage, and lets say that the interest rate at that time is still 4.79%, would this actually bring his monthly's down to approx £240pm or would they still remain at £320 for the entire term of his IO mortgage? THANKS AGAIN!
  11. Hi there, A close friend of mine has taken out an Interest Only mortgage without thinking and has just been told by his collegue that the employer maybe laying quite a few people off. This of course has got him really worried and he's started to think about what is gonna happen to him if he lost his job in future. He broke down in tears as he couldn't cope with the thought if his home got repossessed. For Your Information: 1. He's bought a house for £100k just a few days ago (crap area, so prices here are cheap). 2. He has an interest-only £80k mortgage, fixed @ 4.79% for 2yrs after which it variably jumps to 6.79% for a period of 20yrs. 3. He has a lump sum of £20k ready, so that after 2yrs he can pay this to clear some of his mortgage to 60k 4. His monthly payment is approx £320 My questions relate to what sort of mortgage he has and whether he might be able to get help:- 1. First of all he wants to know is that since this is an IO mortgage and he says that lets assume the interest rate is constantly 4.79% for the next 20yrs, when he pays his 20k lump sum after two years (so that'll be 60k mortgage left), will the £320 monthly also go down to approx £240 or will it stay the same? 2. Secondly if he lost his job, he will need help from the DSS. He won't get any help for 9 months, but he's okay with that. He wants to know that do people with INTEREST-ONLY MORTGAGE get help at all from the DSS or is it only those with a REPAYMENT MORTGAGE? Many thanks for helping him! RiPPeR
  12. http://news.independent.co.uk/business/new...ticle484458.ece Housing bubble fears grow as prices hit record high
  13. http://money.guardian.co.uk/news_/story/0,,1775037,00.html Rate of house price inflation doubles in one month
  14. http://observer.guardian.co.uk/business/st...1774166,00.html Markets booming, but jobs disappear
  15. http://www.timesonline.co.uk/article/0,,2095-2168288,00.html 1,000 jobs under threat at Vauxhall’s Ellesmere Port plant
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