Jump to content
House Price Crash Forum
Realistbear

How The Government Plans To Continue Propping Up H P I

Recommended Posts

http://blogs.telegraph.co.uk/finance/ianmcowie/100009080/why-losing-your-job-need-not-mean-losing-your-home/

But the Building Societies Association (BSA) predicts there will be no repeat of the 1990s housing slump because the State now provides much more help for homebuyers who lose their jobs.
Adrian Coles, head of the Building Societies Association (BSA), said there were four reasons homebuyers are less vulnerable than they were in 1991 when 78,000 properties were seized by lenders.
Substantially lower mortgage costs, higher State benefits for homebuyers
and better advice on debt management for borrowers and lenders mean the market is safer today than it was 20 years ago – despite house prices having soared since then.
Even a cut in the rate of income support for mortgage interest – reduced from a fixed rate of 6.08 per cent to 3.63 per cent in October – should not offset improved help for homebuyers and lower costs since then.
Mr Coles said: “Interest rates peaked at 15.4 per cent in 1990 but many lenders’ standard variable rate is now 5 per cent or lower. For example, Nationwide – Britain’s biggest building society – has an SVR of 2.5 per cent.
Income support for mortgage interest was increased last year so that it can cover mortgages of up to £200,000 rather than the previous maximum limit of £100,000
and homebuyers need only wait 13 weeks for help rather than the previous minimum of 39 weeks.
“There is also much wider access to free and independent debt advice. For example, the National Debt Line used to have just 10 or 15 people answering the phones, there are more than 100.
Finally, there is much improved lender forbearance
.

It does appear that the government are pulling out all the stops to keep HPI on track to deny the nation lower house prices and a healthier economy in the LONG TERM. Short term thinking lives on......................................

Share this post


Link to post
Share on other sites

http://blogs.telegraph.co.uk/finance/ianmcowie/100009080/why-losing-your-job-need-not-mean-losing-your-home/

But the Building Societies Association (BSA) predicts there will be no repeat of the 1990s housing slump because the State now provides much more help for homebuyers who lose their jobs.
Adrian Coles, head of the Building Societies Association (BSA), said there were four reasons homebuyers are less vulnerable than they were in 1991 when 78,000 properties were seized by lenders.
Substantially lower mortgage costs, higher State benefits for homebuyers
and better advice on debt management for borrowers and lenders mean the market is safer today than it was 20 years ago – despite house prices having soared since then.
Even a cut in the rate of income support for mortgage interest – reduced from a fixed rate of 6.08 per cent to 3.63 per cent in October – should not offset improved help for homebuyers and lower costs since then.
Mr Coles said: “Interest rates peaked at 15.4 per cent in 1990 but many lenders’ standard variable rate is now 5 per cent or lower. For example, Nationwide – Britain’s biggest building society – has an SVR of 2.5 per cent.
Income support for mortgage interest was increased last year so that it can cover mortgages of up to £200,000 rather than the previous maximum limit of £100,000
and homebuyers need only wait 13 weeks for help rather than the previous minimum of 39 weeks.
“There is also much wider access to free and independent debt advice. For example, the National Debt Line used to have just 10 or 15 people answering the phones, there are more than 100.
Finally, there is much improved lender forbearance
.

It does appear that the government are pulling out all the stops to keep HPI on track to deny the nation lower house prices and a healthier economy in the LONG TERM. Short term thinking lives on......................................

Old, old news

Share this post


Link to post
Share on other sites

I'd wait until the government states its policy - earlier this year it was understood the 200k limit would be reduced to the original 100k.

And there is no way the drop from 6% to 3.5% won't impact affordability.

Share this post


Link to post
Share on other sites

We knew it was coming...

What the prudent need to do is tell the government to go fook themselves by converting all their money into something other that this lousy rotten fiat that keeps being devalued to keep assholes in houses they can ill afford.

Share this post


Link to post
Share on other sites
Income support for mortgage interest was increased last year so that it can cover mortgages of up to £200,000 rather than the previous maximum limit of £100,000 and homebuyers need only wait 13 weeks for help rather than the previous minimum of 39 weeks

As I've pointed out on this site more times than I care to remember, in the early nineties the SMI scheme was far more generous than that in place currently. There was NO wait of 39 weeks, or even 13 weeks, NO capital limit whatsoever, not £100k or £200k or anything else, and NO time limit on claims. Didn't stop a massive crash though.

There seems to be collective amnesia about this. Surely I'm not the only one who remembers it?!

Share this post


Link to post
Share on other sites

As I've pointed out on this site more times than I care to remember, in the early nineties the SMI scheme was far more generous than that in place currently. There was NO wait of 39 weeks, or even 13 weeks, NO capital limit whatsoever, not £100k or £200k or anything else, and NO time limit on claims. Didn't stop a massive crash though.

There seems to be collective amnesia about this. Surely I'm not the only one who remembers it?!

The reason the newspapers keep bringing it up is because they survey people and find out over 80% have forgotten about what happened in the last crash. Some are too young to remember or too young to have been interested. Was watching a holocaust related thing last night (Band of Brothers part 9) and I think it is a good idea to remind people of the horrors that were commited before so that we think twice about doing it again. In this case the government ought to learn they can't beat the market and high house prices are NOT GOOD fora nhyone other than banksters.

Its a bit of refresher to remind us lot that the government stilll has an anti-HPC policy in place.

Share this post


Link to post
Share on other sites

As I've pointed out on this site more times than I care to remember, in the early nineties the SMI scheme was far more generous than that in place currently. There was NO wait of 39 weeks, or even 13 weeks, NO capital limit whatsoever, not £100k or £200k or anything else, and NO time limit on claims. Didn't stop a massive crash though.

There seems to be collective amnesia about this. Surely I'm not the only one who remembers it?!

Hey, what's with the lack of hysteria!

This government MUST want HPI to continue because they haven't come out and said to the (majority homeowning) electorate they want them to fall :ph34r:

So SMI has been halved and is not being extended beyond two years, and the SLS is not being extended, and CGT has increased and HB is being reduced etc. etc. Don't you get it - this is all a cunning double bluff by a government who want to maintain rampant HPI at all costs....

Share this post


Link to post
Share on other sites

It does appear that the government are pulling out all the stops to keep HPI on track to deny the nation lower house prices and a healthier economy in the LONG TERM. Short term thinking lives on......................................

I don't think that "they" actually want or are trying to create much further "HPI" (House Price Inflation).

They are just trying to stave off a sudden and serious collapse of the housing market.

This is not as simple as "thats because they are VIs", although this is a big part of it.

Unfortunately, a sudden big crash in house prices would inevitably result in a general "nightmare scenario" for the rest of the economy.

Suddenly loads of banks would be revealed as being insolvent with the security for their loans being insufficient, you'd get bank runs, total drying up of any lending (not just mortgages) which would mean loads more businesses running out of cash and going broke, more unemployed, even those who still had jobs would batten down the hatches and stop spending on ANYTHING not essential, which in turn would cause more job losses etc etc.

People on here (some of them) wish for a neatly contained and yet major collapse in house prices that conveniently leaves everything else, like their jobs, and the economy generally, pretty much untouched.

I think that this is like asking the US Air Force to carry out a "surgical strike" with no "collateral damage".

Can't be done.

Share this post


Link to post
Share on other sites

I don't think that "they" actually want or are trying to create much further "HPI" (House Price Inflation).

They are just trying to stave off a sudden and serious collapse of the housing market.

This is not as simple as "thats because they are VIs", although this is a big part of it.

Unfortunately, a sudden big crash in house prices would inevitably result in a general "nightmare scenario" for the rest of the economy.

Suddenly loads of banks would be revealed as being insolvent with the security for their loans being insufficient, you'd get bank runs, total drying up of any lending (not just mortgages) which would mean loads more businesses running out of cash and going broke, more unemployed, even those who still had jobs would batten down the hatches and stop spending on ANYTHING not essential, which in turn would cause more job losses etc etc.

People on here (some of them) wish for a neatly contained and yet major collapse in house prices that conveniently leaves everything else, like their jobs, and the economy generally, pretty much untouched.

I think that this is like asking the US Air Force to carry out a "surgical strike" with no "collateral damage".

Can't be done.

Past caring. If your alternative is rescuing and protecting every bank and 'important' business which needs a bail out, QE upon QE, I'd rather lose all my savings than play that skanky protectioist game which is unfair and leading to ever worse problems, than buy an overvalued house now. The savings I've put away towards a house are considerable too. Could start over from the ruins with a level playing field, providing debtors too had to honour their mortgage debts. We'd see some rapid growth again too as everything was restructured from allowing the crash. The impulse for that outcome must be even stronger for an increasing number of people hoping to buy a house in their mid and late 20s out of university, with little savings and fewer good job prospects.

Share this post


Link to post
Share on other sites

Past caring. If your alternative is rescuing and protecting every bank and 'important' business which needs a bail out, QE upon QE, I'd rather lose all my savings than play that skanky protectioist game which is unfair and leading to ever worse problems, than buy an overvalued house now. The savings I've put away towards a house are considerable too. Could start over from the ruins with a level playing field, providing debtors too had to honour their mortgage debts. We'd see some rapid growth again too as everything was restructured from allowing the crash. The impulse for that outcome must be even stronger for an increasing number of people hoping to buy a house in their mid and late 20s out of university, with little savings and fewer good job prospects.

If there is a really serious economic collapse, are these people likely to:

(1) have steady jobs

(2) be able to borrow money

(3) even want to buy a house in those circumstances

?

I think that prices will slowly fall, and inflation will gradually unwind people's debts.

Unless things to really go titts-up!

Edited by kingsgate

Share this post


Link to post
Share on other sites

I don't think that "they" actually want or are trying to create much further "HPI" (House Price Inflation).

They are just trying to stave off a sudden and serious collapse of the housing market.

This is not as simple as "thats because they are VIs", although this is a big part of it.

Unfortunately, a sudden big crash in house prices would inevitably result in a general "nightmare scenario" for the rest of the economy.

Suddenly loads of banks would be revealed as being insolvent with the security for their loans being insufficient, you'd get bank runs, total drying up of any lending (not just mortgages) which would mean loads more businesses running out of cash and going broke, more unemployed, even those who still had jobs would batten down the hatches and stop spending on ANYTHING not essential, which in turn would cause more job losses etc etc.

People on here (some of them) wish for a neatly contained and yet major collapse in house prices that conveniently leaves everything else, like their jobs, and the economy generally, pretty much untouched.

I think that this is like asking the US Air Force to carry out a "surgical strike" with no "collateral damage".

Can't be done.

Sums the situation up very well. Unwinding this mess it pretty tricky. It could all fall down at any moment.

Ironically, there is a good chance that those with real assets, such as a house, and a big debt, might end up being the ones that are the biggest winners if they cant unwind this mess in an orderly fashion.

Share this post


Link to post
Share on other sites

But the Building Societies Association (BSA) predicts there will be no repeat of the 1990s housing slump because the State now provides taxpayer is being forced to provide much more help for homebuyers who lose their jobs.

Share this post


Link to post
Share on other sites

I don't think that "they" actually want or are trying to create much further "HPI" (House Price Inflation).

They are just trying to stave off a sudden and serious collapse of the housing market.

This is not as simple as "thats because they are VIs", although this is a big part of it.

Unfortunately, a sudden big crash in house prices would inevitably result in a general "nightmare scenario" for the rest of the economy.

Suddenly loads of banks would be revealed as being insolvent with the security for their loans being insufficient, you'd get bank runs, total drying up of any lending (not just mortgages) which would mean loads more businesses running out of cash and going broke, more unemployed, even those who still had jobs would batten down the hatches and stop spending on ANYTHING not essential, which in turn would cause more job losses etc etc.

People on here (some of them) wish for a neatly contained and yet major collapse in house prices that conveniently leaves everything else, like their jobs, and the economy generally, pretty much untouched.

I think that this is like asking the US Air Force to carry out a "surgical strike" with no "collateral damage".

Can't be done.

When the banks are revealed as empty shells to the general public (who will then loose all confidence in the current monetary system outing the corrupt bankers anyway) they will go back under due to full on housing crash as their assets depreciate again with massive defaults on mortgage payments.

Britain then becomes the catalyst to bring down World banking systems again coz of defaults and the knock-on effects on the other empty shell banks (illegally operating themselves) as credible, fully funded agencies.

Edited by erranta

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.