misfit

I for one do not like it M

I could not agree more Market forces do not apply as defenders say trust in market forces but this is disengenuous as markets were deregulated in the late 90's and interest rates have been manipulated for the last 10 years which has helped to lead us down this road. Andrew Sentance said as much recently in a R4 interview. He is the only one voting for a rate rise at the moment. It is about time someone listened to him before it results into a front page headline shocker in months to come. I now feel like I need a drop of Talisker to celebrate the post of the day M

Typical VI spin by Boulger and how he can away with this sort of financial advice is frightening, as he is just trying to increase personal debt. I thought we were in an age of austerity Those in influencial positions should be forced to take care in what they say as it is people believing this sort of hype without thinking about how they are going to pay it back which led us into the recession. M

My tip would be to ignore all the housing programmes and take all the compromises you are willing to make such as on a main road or next to a train line, in an unfashionable area which may take a while to get to work but the chances are it will be these compromises which will mean you are paying a much fairer price than trying to "tick all your wish list boxes." This also means your time as a wage slave will be reduced compared to buying a nicer house in a quiet cul-de-sac in a sought after area with the possibility of stil having the mortgage post retirement. M

This echoes my own view point M

Hello Realist Bear I am not sure about 14% but Dr David Kuo from The Motley Fool believes interest rates could rise to 8% given the level of inflation in the economy. I do not think this is unrealistic given the RPI is approximately 5%. The CPI is over 3% which means bank interest rates should be between 4 and 5% if we were in a realistic economy so bearing this in mind I do not think 8% is unreasonable. The problem is we are not living in a realistic economy. We are living in one where a loan is 8% and savings approximately 2.75%. No wonder the banks are recording record profits. I know they have to go to the capital markets to borrow and there is a cost to this but the profit margin is significantly larger than it has been for a long time. Savers are being punished for their prudence, which seems unfair to me. For the time being it looks like UK Plc will be a net importer. If this happens then the B of E would talk down the value of sterling to keep it low though I am not sure it can keep a lid on inflation which looks to take off very soon with the UK growing at its fastest rate for 4 years. Best M

The last 5 minutes of the attached link: http://www.bbc.co.uk/iplayer/episode/b00tgz6f/On_the_Fringe_with_Stephen_K_Amos/ What makes him angry? - Not being able to get on the property ladder. It's the old peoples fault Best M

Well I think the politicians, and in particular Gordon Brown for his manoeuvres in 1997 with regards to deregulation, courting the City creating a new class, the Super Rich which helped to push up house prices and drive up stamp duty for the Government. This coupled with artificially low interest rates from 2001 onwards helped fuel this boom and defer a recession which should have happened in 2001. The side effects of this were that bankers started to borrow on so called affordability and this drove up the prices estate agents were charging. Some older people with little debt were then able to borrow to purchase BTL properties, borrow against these properties to purchase even more properties and the fact that there was no mechanism in place to stop this raping of scarce resources falls at the door of politicians. The comedian Andrew Lawrence does a very good routine about house price affordability and his anger is very evident. M

I don't normally agree with the bulls but I think this is good advice for those seeking to invest outside the banks' lowly rates Personally I missed out on NS&I as my bond from a previous year had not matured at the time. How frustrated I am now but that is the way it goes. M

No, so don't ask me out Joking aside but is gender relevant to this point M

Prices are as unaffordable in most of the Home Counties as they are in London so I do not think the above statement is useful. At the moment interest rates are at a record low but as soon as they start rising mortgages could rise to 6 - 7% within the next few years. The NS&I have recently withdrawn a lot of their savings products which matched inflation which is a possible indicator that the Govt. expect inflation to rise. A house is a medium to long term purchase which means if people do stretch themselves to get on the ladder now they could face serious problems within the next few years if inflation does start to rise. I am sure we have not forgotten only a few years ago when rates were low and people stretched themselves with a discounted mortgage. After 2 or 3 years the discounted rate falls away and once often has to find a further £300 - £400 a month which for most people can be a lot of money. The furture of interest rates is the key and there are arguments for the status quo and a rise. I do not know the answer but I do know that unless one can afford a mortgage with enough to spare to allow for any future increases buying now could be a dangerous decision. M

I could not agree more M

One can not decide to enter into a relationship because it saves money. There are other factors at play here and I think this is one decision where money is irrelevant. M

Agreed and don't bail out the car manufacturers either. If we misjudge the market no one is going to come in and bail out my company.

I am a doomster, a flat owning doomster but in my defence it is a cold, damp flat with thin walls and noisy neighbours. It is now worth the same amount I paid and I could not care less and actively support further percentage point falls. I believe this type of property is inkeeping with the old world view of ownership. This is in complete contrast to the types of properties expected by the debt ridden, a lovely 2 bed on a lovely high street with a Starbucks and Pizza express to quote Sarah Beeney at probably ex 120% mortgages. Whoever thought that was a good idea? Moral - Buy a property you can afford and not one to which you aspire. If not you deserve all that befalls you. Happy New Year M