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The Days Of 'having It All' Are Over........

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The warnings are now coming thick and fast. This one (abridged version) is from todays Telegraph.......

The days when you could have it all are over

(Filed: 27/10/2005)

You can believe Government statistics when they're bad. Yesterday the Department for Constitutional Affairs, which has responsibility for the courts, released figures showing that the number of home repossession orders has risen 66 per cent on the same quarter last year. ..........................

Why has this happened? Part of the explanation lies in the expiry of cheap fixed-rate mortgages. Two years ago, the Britannia Building Society offered a fixed rate of 3.24 per cent; now it has reverted to the standard variable rate of 6.1 per cent, causing disaster for bad planners and the unlucky. .....................

But the real explanation lies not in passing changes to the mortgage markets or the law. 20,000 people are in danger of losing their homes because they represent the trailing edge of a desperate national phenomenon: consumer debt. There are 66 million credit cards in existence, more than one for every man, woman and child in the country. On these and other forms of credit (including mortgages) we collectively owe each other more than £1 trillion...........................

The explanation for mass consumer debt, of course, is cheap money. For years we have enjoyed low interest rates, as inflationary pressures in the economy were tamed by the supply-side reforms of the 1980s. Now those reforms are under threat, as the channels of the economy become choked with taxation, regulation, and bureaucracy. Public sector inflation is running at around five per cent. With oil prices so high, a rate rise may be the only way to see off inflation - but it would devastate thousands of families.

The lenders who, with their glossy brochures and invisible small print, induce us to take out all this credit, insist that the repossession figures are nothing to worry about. They point out that only a tiny proportion of mortgagees are in arrears. Yet as an economist quoted in our news pages today points out, before the great credit crunch of the early 1990s, the repossession order figures turned out to be a better guide to the coming calamity than the state of arrears.

A repossession order represents the final warning for a homeowner. Yesterday's figures might serve the same purpose for the economy as a whole, for its supervisor, Gordon Brown, and for those reckless borrowers - us.


and another one here.......


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  • 337 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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