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Jonnybegood

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Everything posted by Jonnybegood

  1. Bit naughty, should'nt you be telling him to get a Hetas installer to do the work or a building inspector. Could save your life......
  2. Back up and running. Closure cancelled, panic over
  3. http://financialadvice.co.uk/news/3/househ...ergy-bills.html So it seems just like petrol at the pumps, the moment these things get to a level where people simply cannot afford them they cut back on usage, a global drop in oil demand has led to prices tumbling, expect the same with Gas over the coming 12mths as companies compete to offload their supplies. People will get used to using less Gas and Electric just like many started to get on their bikes , share cars or simply walk to pick up the morning paper when oil prices rose to $140 a barrel. Only now are the price hikes starting to filter through to the consumer, people are more conscious of leaving lights on and items on standby at night. Instead of 20 degrees on the stat people are finding 19 degrees is just as warm when not walking around in shorts and T shirt but with a jumper on when its freezing outside. Another article from the same site talking about the chancellor taking legal action to get the energy companies to pass on wholesale price cuts. http://financialadvice.co.uk/news/3/househ...s-to-court.html
  4. I bought a TV from John Lewis last weekend for £899, 2.5% cut passed on would of saved me over £20. Now reading John Lewis terms of sale if the price drops within 28days of sale they will refund the difference, no small print regarding VAT just a fall in price within 28days. If this goes ahead and it is passed on to the customer, how many are going to be asking the question as above, it will cause havoc. The best thing they could of done would be to announce now an increase in VAT after christmas, at least that way everyone would pop out now and buy all they need before the increase comes into force. This could pay for a reduction in income tax, win win.....
  5. I still think that Flats are going to throw the figures, the ratio of new builds over the last 5 years has been largely new build flats and shoebox townhouses. At the end of the day people need to realise that flats are not going to fill the housing gap, just like brand new ford fiestas do not. A new Ford fiesta cost £8k brand new with 3 year warranty , 50MPG but still people go out and pay £8k plus for a second hand car that suits their needs better like a people carrier. If less people carriers had been built over the past 5 years compared to fiestas then I am sure demand for them would be constant over the long term despite the odd problem trying to raise finance to pay for them. There is still without doubt a shortage of good quality family housing and with the downturn possibly taking 3-4 years to fully play out, new housing is going to take a big hit and will knock back construction of new family housing by a few years. Next year will end similar to this year with mixed news affecting the monthly falls, falls of up to 18% inflation adjusted with 2010 and 2011 showing gains and falls MOM until things start to fully recover in 2012 with prices rises 3-4% above inflation. Price by Dec 09 will be no less than £140k, but once again flats lead the way will biggest falls as more people turn to houses as prices fall and turn their back on small shoe box properties. Example - If you live in a nice sought after area and a detached property today sells for £300k, then by Dec 09 I would expect it sell for between £260k - £270k An inner city flat today selling for £200k I would expect to be selling for £150k by Dec 09
  6. He is saying 40% fall from Nationwides £199k peak in 2007, a fall to £120k. However the LR figures peaked at £180k so taking that figure its likely that prices will fall 30-35%
  7. Jonnybegood

    Bridgend

    Quite right, I have seen price reductions recently. A quick read through the local property paper though and any half decent is still £150k plus. There is so much crap at under £150k, there are lots of older property in Bridgend that interior deco on most the decent property under £150k is awful. I do offer you the opportunity to have a look on Rightmove and find a decent property under £150k in a nice location that would house a family. Shoeboxes in Brackla are still fetching £120k plus. Here in Cowbridge prices on average have fallen 5%, i like to think of the place as being more immune than other places, however job losses will filter through one way or another. During the last recession of the 90s Cowbridge faired quite well as repossessions were kept to a minimum as many people in the town seemed to avoid the job cuts.
  8. I think you miss the point on a number of the points. Illegal , fraud ??? Desperate times require desperate measures, the rules and laws can be changed, was Lloyds TSB shown the green light to take HBOS by the government, in normal times this would not of been allowed to happen, however the government fully backed it. You mentioned the reasons for not putting the property for auction in the first statement, if the borrower is in neg equity and the bank put it to auction they may have to write down thousands against their balance sheets. Also property prices in general continue to fall, not good when your trying to sell to recover your lending. This is why renting out the properties is the better option for banks in falling markets, they restrict lending and keep prices high forcing many into rented accommodation and then when they relax lending prices rise and they sell the property at the top of the market. as he has done a deal for rent, why couldnt he have done a deal on the mortgage - Renting back is an option or last resort, many times the mortgage can be re jigged, it depends on the circumstances. F: why would anyone else bother to pay the mortgage, - Because many have lots of equity and able to meet their monthly repayments. This scheme would only be for those who have lost their jobs etc, BTL mortgages would be excluded.
  9. Banks renting out property is coming to a town near you. This has been talked about for quite some time and now has the governments blessing as a way of avoiding putting families on the street. It was recently touched upon when the government mentioned the rescue package for homeowners. This is a proposal I was shown recently Current property value £100k Outstanding mortgage £120k Consultation with borrower as to how they can repay the outstanding, all fails so last resort is repossession of the property. 1st option Lender puts the property to auction and sells for £80k, the borrower now has £40k still owing to the bank, interest here is either frozen or set at a very low rate. 2nd option Borrower hands over the property to the lender and they take possession and agree to rent the property to the borrower for a minimum agreed term with the option to buy the property back at a future date. 3rd option the lender takes possession of the property and puts it on the open market for rent at current going rates. Rentals will be managed by local EA and the banks own EA businesses. Should to a degree prevent further heavy falls in property prices as previously repossessed auction properties have led the way with price falls, it gives borrowers the option to stay in their home and not have to disrupt childrens schooling etc. It gives the banks and government a better image as they look to be helping people as best they can in difficult circumstances. Going forward once out of the downturn mortgages would then be extended for those who want to buy back into their property or the lender sells of the property in a rising market giving any of the difference back to the borrower which after interest charges etc will probably be very little if any.
  10. I agree with this but the figures I do not, average uk wage is currently £26k. A safe lending environment for the banks is often down to the deposit and then the multiples. i.e If you buy a £100k property on a 100% mortgage and earn £50k per annum then its only 2x income but you could lose your job within 6 months and the bank is stuck with a £100k property you have defaulted on. However if you earn £30k but put down a 20% deposit then you have a £80k mortgage and the bank 20% equity already for security and you lend at 2.5 x income. So I see lenders asking for deposits of between 15 - 25%, with 3.5x income plus second income. i.e £130k property - 20% deposit = £104k mortgage. 3.5X first income (£26k average wage) = £91k plus second income £12k = £103k mortgage. This is why the average price is going to fall in the region of 30% from peak of £180k.
  11. When comparing to the US be very careful as many states have seen little falls whilst others seen falls in the region of 50%, overall the falls there on average have been 30%. New York was still rising the last time I checked and Detroit was falling 40% plus. Here current figures suggest 15% falls on average, however dig a little deeper and you will see Flats / apartments have fallen by 18% plus whilst family homes 3/4 bed semi/detached property ranging from 8-12% on average. There will be bargains at auction and distressed sellers with rising unemployment however with government measures now being put in place to reduce repossession orders maybe we will have a leveling off once BTL second homes etc go to the wall. I agree with the OP that this will be dragged out over the next 5 years, with early signs of recovery around 2012 and normality returning towards 2013. Nominally falls are going to be 30% on good family housing stock with falls of upto 60% on BTL and auction repossessions as well as poorly located and built shoe box apartments. In real terms it means prices going back to 1999-2000 levels but in reality nominal falls will be those seen in 2002-03
  12. Shipping costs have plummeted in the last month, a large part of my brothers work is in the steel industry. The price of steel has fallen sharply over the last couple of months by around 50%, however at the same time freight costs for raw materials have also fallen in the region of 60-70%, this at the moment is what is keeping the steel industry here above water. He was telling me that 2 months ago you could not get a ship even if you paid 15% above cost, now they are knocking your door with 60% off prices within a couple of months. Crazy times
  13. The fall in house prices will be governed by level of income , level of employment , level of lending , cost of building. Take the first one, average wage is going to remain around £26k per annum Employment levels are an unknown at the moment, it depends on how badly the recession hits and how much employment is nationalised, i still see the NHS recruiting like there is no tomorrow. Lending will get tightened the days of 6x single income are well past but agin depending on the 2 above there will be nothing wrong in lending 3 - 3.5X single plus second income. The cost of building property is going to nose dive over the next couple of years as both land and materials prices collapse, however over the medium term I expect material costs , transport costs , machinery costs to increase in price as oil and other fuels return to their upward direction. The above are not going to create another boom but remove the idea of cheap cheap property in future, maybe the next couple of years will be the best opportunity to buy at relaistic prices
  14. Its clear all countries are starting to feel this financial crisis and no one country on its own can do enough to ease the problem. There have already been attempts at co ordinated action with interest cuts on the same day across Europe and the US. Where is this going to end? markets are in freefall across the globe and for many of the western countries debt plays a big role and will hinder any quick recovery. I had a thought last night that if it does get really really bad globally that this new world that has been spoken about will come to light, there is already talk of a different type of financial system. So could debt in a number of leading countries be frozen whilst everything else doubles , triples. I.e You currently earn £25k per annum You have a £100k mortgage A loaf of bread costs £1 New car £10k This becomes £50k per annum earnings The mortgage remains £100k The loaf of bread costs £2 New car £20k If this was repeated in a number of countries, i.e everything doubles would it be possible as a way of reducing debt Just a thought, if things got super bad I don't mean like inflation but simply your savings of £20k suddenly becomes £40k, for every £1 of old currency you trade in you get £2 in new currency.
  15. Got the same letter today from Swalec (Part of the same group) telling me that prices rose in August but as I am on a fixed rate till November 30th it does not affect me until then. Will be back in touch when that time comes and issue the new tariff.
  16. How quickly things can change direction, only 2 months ago they were talking £1k annual Gas bills around the corner. I have noticed the therm price falling over the past month to levels of mid 2007 and I think once the oil drop filters through its going to fall alot more, maybe back to 30p or so. No wonder they were so keen for everyone to fix their deals and get locked in for 2 years or more.
  17. Its a difficult balance to strike, there are many different situations where people find themselves being repossessed. Some through illness and loss of a long term job. The problem that the government are foreseeing and rightly so is that many hard working families may become repossessed through a downturn in the job market and rising food and energy costs. These families may have paid a number of years off the mortgage and even with maybe 40% equity currently, the housing market is dead and 40% slashed at auction may not attract any buyers because mortgages are difficult to get hold of. Another example FTB buys 3 years ago a £100k property puts down £30k deposit to leave a £70k loan @ £450pm. Mortgage has now gone onto SVR at £500 and homeowner loses job, can still afford the £500 mortgage but with all the other bills, energy, food etc cannot afford the £500pm. Now the FTB put down a good 30% deposit, bought a reasonable priced property and loses a job after 8 years. Trys to sell the property but no interest even with 20% slashed from the price...... I personally think this example should receive help, did not overstretch was in a secure job, put down a healthy deposit, offers property at 20% less to prevent being repossessed but market so bad there is no interest. Why should they be thrown on the street and in the process lose their 30% (£30k) deposit due to government and bank failure, which have now received bailout to save themselves, surely this in certain circumstances should be passed down to the homeowner.
  18. If there came a time when there was no such thing as mortgages and lending and the only way to buy a property was to pay cash then your average new build would cost around £20k. When I mean new build, it would literally be 4 walls and a roof and a hole in the corner for you know what. We would have the shanty towns like those of Brazil and many African countries. You would need massive wage deflation across the board otherwise those building property would be paid around £2 a hour to make it viable to sell for cash without a mortgage whilst the local copper gets paid £12 per hour and a loaf of bread costs £1. Must remember alot of the stuff we buy is now imported, this goes for many building materials also. The gap between rich and poor would widen
  19. I am in the same position with my offset, I was told that the money offsetting would be used to clear the mortgage. I do not pay off the mortgage, I wait for a nice second home to come up at the right price for cash. Preferably by the sea
  20. I also like offset mortgages, as a higher tax payer I am currently getting a rate of 8.5% on the savings part of the account and in times like these where banks are looking a little risky its nice to know that your savings will simply be used to cover the outstanding mortgage. Offsetting reduced my mortgage turn from 25 years to 12 years and now I only have 7 left to pay.
  21. Must be said the 25 year fixed deals that were floating about a year or so ago were in my eyes a superb deal, even with houses at the higher prices. I remember I think the woolwich or nationwide offering 4.8% fixed for 25 years with a £799 fee and 90% LTV, it had a 10 year tie in. If you think of house prices 30% less with a 7% rate with a 75% LTV and £999 arrangement fee and maybe having to switch providers for better deals a number of times over the course of the mortgage, then for the security etc those 25 year deals were spot on.
  22. Once the financial mess is cleared up expect to hear more about illegal debt. This I think will be the next stage in the economic recovery, because whats the point of saving all these banks and bending over backwards to help them using taxpayers money when after all they have been irresponsibly lending, have been unregulated, and everyday day more and more news coming to light about the greed of the bankers with no thought for the end result. These banks once stable are going to be held accountable, many will have been brought back from the brink and some even nationalised, expect to see deals done to wipe off large amounts of personal debt especially homeowner mortgages, its the only way I can see normality returning and avoiding much civil unrest and mass homelessness. If mortgages are reduced by ex percent then this will feed through to lower house prices, if you owe £100k mortgage and your property is only worth £70k you either stick it out without selling or you get repossessed, however with a mortgage of £70k you would be happy to sell for £70k. This will mean lower house prices everyone, less repossession and less debt overall. There will be losers but its the only way I see us getting out of this mess, once a percentage of the debt is cleared and new regulation comes into play the days of 5x mortgages will be a forgotten memory and everyone can move forward with controlled levels of lending, because at the moment with the amount of debt currently out there I cannot see it happening. The banks eventually will have to give something back for their reckless actions and the life lines using taxpayers money offered by the governments.
  23. Me and the wife stopped off tonight at the local for a quick half on the way home from a long weekend break, it was just after the rescue package in the US was voted down. Majority in the pub feel the banks should be left to go to the wall, many of these guys have their own businesses or self employed trades men. The biggest question being asked is why should taxpayers money be used to bail out banks that make ££££££ off the back of every individual, with charges, interest rates , arrangement fees etc. The moment they start to struggle everyone has to gather round and help them out, Why should we!! There were a small number in there who lost their businesses and homes back in the 70s / 90s, they have a bitter feeling against the banks, never forgetting them being quite ruthless in repossessing the property and business. One guy saying where was the government to bail me out back then, did they stop the banks taking away my Car and home, if anything the money should go to help those who have suffered because of non existent regulation of the banking sector instead of propping up a billion pound organisation help the man on the street for a change. I know the financial sector going under would effect every single person in some way or another but attitudes are changing, and some people are getting quite angry about all these bailouts. Thing is how do the government get out of this, they save the financial sector, and then repossessions go through the roof and people on the news seen on the street been forced out of their homes with no help from the banks or government. Its a recipe for a very ugly scene
  24. A FTB can easily pick up a property 20% less than back before the credit crunch. With an average FTB property priced at £115k back then, its going to be under £100k, with a 5% deposit it will be nearer £90k. I personally do not think this is too far off the mark of were the government want prices to fall, this is what its all about now. Accept there will be falls, and even bigger ones at auctions but keep them contained. 30%......and the market does not collapse. Yes there are FTB property over £200k but I can only go by average figures. Watching C4 news this evening had a big report on the US market, it seems the worst falls there are 50%, average 30% (new builds) and some areas have not even gone negative, New York city was one mentioned. LA the closer to the city the smaller the falls, out in the suburbs there have been much larger falls upto 26%, so the US does not seem as bad as some of the reports would lead you to believe.
  25. I am sure that the European commission will have something to say as well regarding the monopoly of the market, don't think Gordo will be able to by pass them. This is why Lloyds are the bargain here, I think they closed today under 240p a share. If the deal falls through there is at least 50% to be made on Lloyds, and they may get HBOS for even less.
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