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Imf Backs Ltv Cap To Prevent Housing Bubbles

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http://www.telegraph.co.uk/finance/economics/houseprices/8433264/IMF-backs-LTV-cap-to-prevent-housing-bubbles.html

In a study of housing booms and busts and the damage they inflict on growth, the IMF argued for limits on LTV ratios and debt service-to-income ratios as "useful prudential tools to dampen credit and hence house price growth".

Britain is considering such measures as part of the so-called "macro-prudential toolkit" the regulator will wield to deflate a housing bubble before it bursts. The move would prevent lenders offering 125pc loans, as Northern Rock infamously did before its collapse.

"Higher LTV ratios are associated with higher house price and credit growth over time," the report said.

Critics fear the policy would hurt first-time buyers, but the IMF suggested remedies. "Mortgages that do not meet the strict LTV limit could, for example, still be made available to those borrowers who agree to purchase adequate mortgage insurance," it said. "Alternatively, bank supervisors would need to assign higher capital risk weights for non-conforming mortgages."

Critics as in VI's? High LTV won't hurt first-time buyers but it will hurt all of those with over priced houses as they'll have to reduce asking prices.

If you can't afford to save a deposit you can't afford to buy.

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I read that last bit as.......

Critics say such measures will save the few remaining financialy reckless first time buyers from their own stupidity in the short term, and benefit the whole economy in the long term. Those who benefit will do so at the expense of vested interest groups such as housebuilders and the banks.

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If the IMF can implement such a policy it will kill our biggest industry stone dead.

HPI is the British economy. We have nothing in place to replace the service industry that feeds it. The opportunity to kill the beast is still with us but we can see the banks starting to stretch the LTVs again to keep the monster alive.

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If the IMF can implement such a policy it will kill our biggest industry stone dead.

HPI is the British economy. We have nothing in place to replace the service industry that feeds it. The opportunity to kill the beast is still with us but we can see the banks starting to stretch the LTVs again to keep the monster alive.

Would you dance on the grave of HPi?

What can we replace it with?

We could become a safe haven for dictators escaping their countries after rebellions...

We could educate every student who wants to come here.

We could become a giant tourist park for people to come and point at the "do not feed the proles" signs

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BREAKING:

http://uk.reuters.com/article/2011/04/07/Ray-Boulgers-Head-Explodes-LDE7360M220110407

Ray Boulgers head exploded this morning, covering his wife and Móben kitchen in an evil, tarry substance. His body was found still clutching a report from the IMF proposing sensible changes to his industry. It is understood that his inner vested interest over-heated and escaped through his bodies weakest point.

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  • 312 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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