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eric pebble

Severely Depressed Uk Mortgage Market Heralds Price Collapse.

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Severely depressed UK mortgage market heralds price collapse.

UK house prices will drop off the edge of a cliff if interest rates start to go up as a knock on effect of the growing euro zone financial crisis, and the lowest mortgage approvals in 20 years may already herald a price collapse.

Very good article: on the nail.

See here: - http://arabianmoney.net/banking-finance/2010/11/30/severely-depressed-uk-mortgage-market-heralds-price-collapse/

Edited by eric pebble

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Sky News, about an hour ago, were talking about how people were benefitting from lower mortgage repayments.

When they said what the averahe mortgage and I compared it to my rent I thought what a mug I am!

I think we have more chance of a heatwave tomorrow here in the UK than IRs rising in the UK in the next 5 years.

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I honestly don't know what will happen in five years time! :huh:

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I meant, I don't think IRs will rise for 5 years.

They have been so low for so long!

Still I still look at the blue chart on the front page! :huh:

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I meant, I don't think IRs will rise for 5 years.

In japan the base rate was 0.5 between 1995 and 2001.

Then in 2001 over a few months it was cut to 0.35%, then to 0.25% then to 0.1..

has been at 0.1% since 2001.

We could easily see another decade of near zero interest rates.

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Sky News, about an hour ago, were talking about how people were benefitting from lower mortgage repayments.

When they said what the averahe mortgage and I compared it to my rent I thought what a mug I am!

I think we have more chance of a heatwave tomorrow here in the UK than IRs rising in the UK in the next 5 years.

IIRC a MPC member said recently that they don't need to raise IR slowly and soon, to prevent inflation, or nip it in the bud. They can wait for as long as possible, allow some recovery, even some inflation, and then raise IR fast. I guestimate that this may happen between mid 2011 and mid 2012.

I'll rent for 2 or 3 years more. Or buy with a long term fixed, preferably 10 years fixed, with a very flexible, transferable mortgage - if they still exist.

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IIRC a MPC member said recently that they don't need to raise IR slowly and soon, to prevent inflation, or nip it in the bud. They can wait for as long as possible, allow some recovery, even some inflation, and then raise IR fast. I guestimate that this may happen between mid 2011 and mid 2012.

or immediately after the next general election

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or immediately after the next general election

They can only delay for a while, until inflation forces their hand. If it is above 4% (IMO) for more than a couple of months, then they will be forced to raise IR or they will lose credibility with the gilts market. And the BoE won't be able to do more QE and buy gilts if inflation is this high. The VAT increase from January may force their hand.

I know the BoE has been saying for a while that the VAT will have only a "temporary" effect, but that is a whole year. As the The Economist wrote this week, how do the BoE defines "temporary"?! Mervyn is already on the limit of credibility with Gilt buyers.

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They can only delay for a while, until inflation forces their hand. If it is above 4% (IMO) for more than a couple of months, then they will be forced to raise IR or they will lose credibility with the gilts market. And the BoE won't be able to do more QE and buy gilts if inflation is this high. The VAT increase from January may force their hand.

I know the BoE has been saying for a while that the VAT will have only a "temporary" effect, but that is a whole year. As the The Economist wrote this week, how do the BoE defines "temporary"?! Mervyn is already on the limit of credibility with Gilt buyers.

They'll let it go hyper before raising rates.

Remember the elites control all the land, means of production and transport, therefore once hyper kicks in everything belongs to them.

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Guest The Relaxation Suite

They'll let it go hyper before raising rates.

Remember the elites control all the land, means of production and transport, therefore once hyper kicks in everything belongs to them.

And a few months after that they're all hanging from lamp posts. No, interest rates will riser sooner than many think, but gradually and in tiny increments.

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And a few months after that they're all hanging from lamp posts. No, interest rates will riser sooner than many think, but gradually and in tiny increments.

I had assumed so too, but apparently not. I can't remember the source though. May Google it tomorrow.

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And a few months after that they're all hanging from lamp posts. No, interest rates will riser sooner than many think, but gradually and in tiny increments.

The army would shoot to kill to prevent such lynchings from happening. Look around you, do you see an AK47 or RPG in your home... Nope? The army has lots of guns and bombs. One massacre would kill off any chance of revolution. 1989 one blood bath shut the Chinese civvies up for decades. And they were having 20%+ inflation.

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Guest The Relaxation Suite

The army would shoot to kill to prevent such lynchings from happening. Look around you, do you see an AK47 or RPG in your home... Nope? The army has lots of guns and bombs. One massacre would kill off any chance of revolution. 1989 one blood bath shut the Chinese civvies up for decades. And they were having 20%+ inflation.

People in totalitarian states behave differently to people in liberal democracies. If there's a kick-off as I suggested above it will happen in the US first, and the British will simply copy them. Do remember that the US military has been comprehensively beaten by Afghan mountain tribesmen running a guerilla campaign. This would work just as successfully in Britain or America. The only safe place for those who have looted all this money will be on a Caribbean island, which is presumabl;y why Blair is trying to buy a house on one.

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People in totalitarian states behave differently to people in liberal democracies. If there's a kick-off as I suggested above it will happen in the US first, and the British will simply copy them. Do remember that the US military has been comprehensively beaten by Afghan mountain tribesmen running a guerilla campaign. This would work just as successfully in Britain or America. The only safe place for those who have looted all this money will be on a Caribbean island, which is presumabl;y why Blair is trying to buy a house on one.

oooh like in Red Dawn.....

Woooolveriiiiiines!

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They can only delay for a while, until inflation forces their hand. If it is above 4% (IMO) for more than a couple of months, then they will be forced to raise IR or they will lose credibility with the gilts market. And the BoE won't be able to do more QE and buy gilts if inflation is this high.

Haven't they been manipulating the inflation figures? And could continue to do so?

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Depressed mortgage market will do it, we don`t need rates up, rates up would be carnage but prices will drop anyway, and many will default once they realise no one can pay what they paid any more, and many more will have to sell for one reason or another and take what they can get. IMO owning property here is just not that appealing any more, unless it was really top end with land and very far from chavs, this really is becoming a big big mess.

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Depressed mortgage market will do it, we don`t need rates up, rates up would be carnage but prices will drop anyway, and many will default once they realise no one can pay what they paid any more, and many more will have to sell for one reason or another and take what they can get. IMO owning property here is just not that appealing any more, unless it was really top end with land and very far from chavs, this really is becoming a big big mess.

Why would people default when IRs are low and many of them are paying less for their mortgages now than we are paying in rent?

You can't default and walk away in the UK like you can in the US - the debt follows you.

I agree that owning property here in the UK is less and less attractive.

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  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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