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House Price Crash Forum


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Everything posted by DrBob

  1. Check out the historical house prices at http://www.nationwide.co.uk/hpi/historical.htm. Look for "UK House Prices since 1952". In the crash of the early 90's, prices peaked in Q3 1989, reached their nadir in Q1 1993, and reattained their prior peak in Q1 1998. So, three and a half years to reach the nadir (ideally, you don't want to buy until then), and a total of 8 and a half years until they returned to their prior peak. House price crashes are very slow and painful!
  2. Has anyone noticed the posting frenzy on the MSE mortgages forum? Must be prompted by the IR rise. Here are some choice posts : Self Cert Mortgage needed. Bad Credit. http://forums.moneysavingexpert.com/showthread.html?t=498008 Can anyone recommend a mortgage company who may take me on please. I am a single parent and quite a big chunk of my incomings is from tax credits therefore I do need a self cert mortgage. I have arrangements on my credit cards and unfortunately due to my broker messing me around, I am now in arrears on my existing mortgage with Kensington. The broker I used offered me a fixed rate with repayments of £660 on 126K mortgage, that mortgage company wouldnot accept me and the second company went up to £710, they also rejected me and the third company is now £786, which is what I am currently paying on my standard variable rate with Kensington. I have got an arrangement in place with Kensington to pay my arrears back but I am desperate to get onto a fixed rate with someone. I cannot remortgage with Kensington as they do not remortgage on the same property, moving is not an option as I did that 12 months ago in the same circumstances. Has anyone got any ideas.....or a magic wand ! Many thanks. Adverse Credit Mortgage http://forums.moneysavingexpert.com/showthread.html?t=497244 Me and my partner are looking into to geting a mortgage for around £100K. The problem is I have a CCJ on my credit history which is 3 years old which I am still currently making repayments on. We were looking for a 100% mortgage but i think we realise now that we are not going to be able to get this due to my CCJ. We both have outstanding loans and credit cards totalling around £23,000. We earn around £38k a year combined Our combined outgoings per month at present is £1500. And our combined income at present is £2200-£2300. Is there any chance of use getting a mortgage of this value or any mortgage at all. Please advise me regarding remortgage http://forums.moneysavingexpert.com/showthread.html?t=497658 http://forums.moneysavingexpert.com/showthread.html?t=497658' rel="external nofollow">Our mortgage deal ended 3 month ago so I called up the bank and made a new agreament. We got a fixed rate for another 3 years. My husband now wants us to re-mortgage, take out an extra 20,000 to pay off debts. Our monthly debt payments are currently 466 pound and he says he rather increase our mortgage payment and clear the debts. Since our credit history is not the best at the moment I don't know who to contact regarding re-mortgage. My husband don't want to go to a independent advisor. He just want us to make some calls and sort it as soon as possible. We got our current mortgagee with Natwest. Some of our debts are also with Natwest, Also got a secured loan with a different company that we pay more in interest on than actually paying off. I don't know if it is worth us contacting the bank. They declined our request last year when we asked them, which I understand. But OH got a good income now and recently had a payrise as well. I'm hoping that I can get some good advise here, so I don't end up doing something stupid that we would regret.
  3. I ran some buy-to-let figures into Excel back in 2004 (in London). I could have afforded a small flat in a questionable area, but I wanted to make sure that the rent would cover mortgage interest in case I decided to go abroad. However I tried, I couldn't make it work unless house prices were 20-30% lower. That's when I decided not to buy. Credit to the ThisIsMoney poster for doing their calculations! I suspect many haven't.
  4. Shares predicted to break through 7,000 http://www.telegraph.co.uk/money/main.jhtm...cnshares109.xml Last Updated: 2:04am BST 09/07/2007 Financial experts expect the world's stock markets to break through to uncharted highs this year as a record $2,300bn (£1,150bn) wall of cash is reinvested in equities. In stark contrast to the increasingly bearish views of commentators, equity strategists at Lehman Brothers and JP Morgan are forecasting another unprecedented six to 12 months of deals and market outperformance. Ian Scott, Lehmans' global equity strategist, said: "We've never seen anything like this. There has been more money coming out than going into the market. There is more than enough liquidity to absorb current levels of issuance." " We think the market will take out the 2000 record highs, and we expect a lot of people to come into the market at that point ," he said, adding that the fundamentals this time are stronger, with "no sign of the exuberant retail investor" who propped up dotcom shares and "yields still attractive by historic standards". He added that there will be a "flight to quality" with "large caps leading the markets higher". I'd say the markets are enjoying the last hurrahs before a prolonged stock market crash. Remember that stock market falls seem to occur 6-12 months after the housing market peaks. The view of traders would be that this gives them 6-12 months to make some big profits (and boost their Christmas bonuses). If they can attract a host of 'retail investors' now, this will prop up valuations until the next stock market crash. And remember, professional traders can usually get out much quicker than retail investors can. I'd say we're in the 'greed' stage, moving towards 'delusion'.
  5. Fish ’n’ chip prices leap as shortages bite http://www.ft.com/cms/s/523a3aac-2d8b-11dc...00779fd2ac.html http://www.ft.com/cms/s/523a3aac-2d8b-11dc-939b-0000779fd2ac.html' rel="external nofollow">Last updated: July 8 2007 22:15 Fish ’n’ chip prices are soaring as shortages of potatoes and mushy peas, typically served with Britain’s traditional takeaway, add to increasing food-price inflation. The British Hospitality Association, the trade body for some 11,000 UK restaurants, said restaurants “across the board” had begun to raise menu prices. Bob Cotton, chief executive of the association, said: “Suddenly we’ve got food-price inflation.” Pea prices are expected to increase as the UK faces a 50,000 tonne pea shortage. Crops have been damaged by rain and farmers have also had problems operating harvesting machinery on waterlogged land. Last week Peter Brabeck, chairman of Nestlé, said in China that food prices were poised for a period of “significant and long-lasting” inflation because of demand from China and India and the use of crops for biofuels. He pointed out that rises in food prices reflected not only temporary factors but also long-term and structural changes to supply and demand. The price for top-quality bread-making wheat has increased dramatically during the past two years, rising by 75.3 per cent to £156.50 a tonne projected for the year to July 2008. Flood damage is also putting pressure on prices of animal feed such as feed wheat and soya. That could act to force up prices of poultry, beef and pork. The Food and Agriculture Organisation has forecasted that the growth of the biofuels industry could have the effect of driving up international food prices by between 20 and 50 per cent during the next decade. It's fortunate that the BoE see inflation falling back to 2% by the end of the year. Otherwise we might have needed a couple more interest rate hikes to >6%.
  6. Come on, RB, your next challenge is to get the poisons / mud analogy published on the Times or BBC News website
  7. I thought I'd provide you with some Saturday entertainment from the forum world. Enjoy!:
  8. Expert views: Where next for rates? http://www.thisismoney.co.uk/news/article....mp;in_page_id=2 5 July 2007, 12:34pm The Bank of England has hiked rates to a six-year high of 5.75%: Read the full report. The last time the cost of borrowing was so expensive, UK borrowers owed around £700bn - that figure has since doubled to nearly £1.4 trillion. So what will the impact be and where next for rates? Here is a round-up of views from City analysts, industry leaders and lenders... In summary, financial markets predict interest rates will rise to 6% in September - and many economists now believe there is a strong chance that rates will increase to 6.25% next spring, a rate not reached in the UK since 1998. All the expert predictions are rather boring (most guess at 6 to 6.25% - exactly what the markets are pricing in by year-end). However, I did like this graph of historical interest rates, showing just how low rates are at the moment:
  9. Have a look at this thread: http://www.housepricecrash.co.uk/forum/ind...showtopic=49989 I think that this graph gives a wonderful explanation of the critical role of herding in market bubbles:
  10. This sounds like a standard reply to me. They probably have a template of that letter on their desktop. Mind you, what can you expect when you write to the Bank of England about boiling frogs?
  11. It's a great idea, just think it would be very time consuming. How about just reporting the IPOD index on a weekly basis? This way, the charcol.co.uk website does all the searching for you. Should save quite a lot of time (at least until Charcol go bust)!
  12. Thought I'd better upload the image to HPC for posterity, just in case they delete it from the website completely!
  13. Good find! Do you know if these are brand new posts? I wonder how many BTLers will be happy to let 'DSS' into their precious Neff/Ikea homes? Suspect they won't have much choice if they can't find alternative tenants... And what about their property-owning neighbours who will have paid 250k for an 'executive' new-build flat to find that they now have council-tenant neighbours?
  14. Not very often (yet). We can lose a lot of income though. Hospital junior docs are the current ones having their out-of-hours payments cut right down, and some hospitals are trying to cut down consultants' hours too. The govt is tightening the screw for GPs: 0% pay rise this year, and they'll probably make GPs' targets much more difficult to meet (meaning they will lose income by failing to meet them). All in all (as a junior hospital doc) my income would not change at all over the next 3 years if I stayed in the UK. The seniority increment and 2% 'inflation' increment will be wiped out completely by the loss of out of hours supplements. I'm trying to persuade my colleagues not to buy property at the moment. Rising mortgage repayments + rising cost of living + completely flat income = misery. Amazing how many educated people still think house prices can only go up!
  15. There, there, you poor darling! I'm afraid he's rather like the lamb to the slaughter. Thrust into the post of chancellor at the onset of a giant credit crunch, and soon to suffer a painfully drawn-out house price crash, recession and sterling crisis. The funniest bit about his naive comment is that he chose to make it to the Financial Times!
  16. Oh really, darling? I hadn't considered that! (in best Blackadder IV voice)
  17. I'm in the 2% club, too! It must be because we're rotten parasites feeding off the decent hard-working public.
  18. 'Like a bond', eh? I've tried but failed to understand the 'financial wizardry' which conceals sub-prime mortgage loans taken out at the peak of the housing market within investment grade bonds. They dress it up as 'arbitrage', but those who put together CDOs etc are nothing more than a bunch of con artists: http://en.wikipedia.org/wiki/Con_artist A confidence trick, confidence game, or con for short (also known as a scam) is an attempt to intentionally mislead a person or persons (known as the mark) usually with the goal of financial or other gain.
  19. I think this is incorrect. Many recent BTLers are getting yields which are LESS than the current BoE interest rate (typical London yield approx 4%, interest rate 5.75%). Factor in service charges, voids and repair bills, and many less-than-savvy BTLers will already be subsidising their tenants. And this is in an era of rising interest rates (i.e. it is only going to get worse). Remember that the BoE is charged with controlling inflation (to target of 2%). Inflation is partly a function of the 'strength' of the economy, but as we import so many of our goods (and much of our energy), also depends on the strength of our currency and the costs of commodities. With China slowly revaluing the yen upwards, with the pound at an all-time high (and very little apparently holding it there), a drop in the pound might be all it takes to send inflation (and therefore interest rates) soaring. The BoE are 'stuck'. They have to keep pushing interest rates up to hold down inflation and hold up sterling. The cost of this will be major house price falls. Now ask yourself, how many recent BTLers are going to carry on subsidising their tenants while they struggle to pay their own mortgage, and while they watch the value of their 'asset' decline? The smart ones have sold already. Recent BTLers who try to hang on are in for a very rough time! PS: for those who bought their properties a long time ago and who still have a rental income which would comfortably cover all costs/voids/repairs etc. even after a further 2% rise in interest rates, there may be a reasonable case for riding the storm (although their time scale should be 10-15y before housing fully recovers).
  20. But this is a beautiful 18-bedroom 17th century mansion in 50 acres of grounds! Sorry, but I just can't get over the contrast with the Eastbourne Ikea showroom.
  21. I just had a look at the old MPC voting records (http://www.bankofengland.co.uk/monetarypolicy/mpcvoting.xls). David Blanchflower looks positively hawkish compared to his predecessor, Stephen Nickell (who voted for -0.25% for his last 6 consecutive votes, against the rest of the MPC).
  22. F*** me! Anyone else feel like getting a few people together to buy the mansion? Actually, forget about that - we could just get a joint mortgage and have a poky bedroom each in Eastbourne's 'little Chelsea'. After all, house prices in Britain only go up.
  23. I agree, and I think this index would give some reflection of credit tightening. I like the way it takes no account whatsoever of 'affordability' for the buyer - just what the mortgage provider will lend. This probably reflects the mindset of the aspiring FTB perfectly. So on 30.06.2007 the IPOD index is £133,655. Who's willing to update this each week?
  24. I just looked at this offer on their website: http://online.newcastle.co.uk/mortgage/index.htm 2.25% certainly is an eye-catching initial rate, but this is only until 30 June 2009 (i.e. probably only for 21 months by the time you complete) and is followed by a whopping 4-year extended tie in at the standard variable rate until 30 June 2013! Moreover, the early repayment charges are huge: as much as 7% of the outstanding balance if you try to get out in 2009.
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