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Help To Buy Damp Squid?


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If you're a good credit risk (as you likely are if you saved the 15% yourself while also paying rent), you might consider option 4: a 95% mortgage outside HTB, which might come at an intermediate rate.

I will be considering those, thanks, and obviously the better the rate the happier i'll be.

I was just trying to demonstrate to those that see no value in it that HTB2 could have a use. If you're only copping the high rates for a couple of years before remortgaging in a stronger position it may be worth considering if you can make it work for you.

Different locations have different housing pressures and different people have different needs and priorities, life is complex, there is no one size fits all solution.

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I'll offer up a case study for discussion. I'm considering H2B2 despite the punitive rates when i have other (albeit limited) options.

There's a house i want to buy, it needs a bit of work to be what i want it to be. I've been waiting for a good time to buy for about 2 years now. Assume i'm going for a 2 year fix with the intention of remortgaging after that. (...)

2015 Q4, most probable scenario: It is almost certain that interest rates will be higher than now, and with higher rates house prices will probably be lower than now. If so, by then you'll have very little equity (if at all), and be in serious trouble having to re-mortgage. IMHO a 2 year fix is a gamble with odds against you, and your family. You and your family will be much, much safer as tenants - with large savings. We have been renting for many years, have more savings than you, and we've even stopped calling it "a deposit", as we are not planning to buy any time soon - as we are in the SE, and prices here are still stupid. Sounds like you are in the SW, and IMHO prices there are bubbly too. The safest option is to stay out of these huge, gigantic leveraged bets.

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At what point does it become a reckless gamble rather than George's fault?

The recklessness of the gamble is precisely what George is covering up- by distorting the primary price signal of those risks which are the deposit requirements demanded by the lenders.

The sole intent of Help to Buy is to create an illusion of affordability that will last long enough to win an election.

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HTB isn't about money its about risk, and unfortunately its going through the private banking sector who are somewhat adept about dispersing their risk and keeping profit. Taxpayers will feel this one day, but not yet. I'd like to think the public aren't stupid enough to try and pile in again, but when you listen to people talk about it.. no they really are.

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2015 Q4, most probable scenario: It is almost certain that interest rates will be higher than now, and with higher rates house prices will probably be lower than now. If so, by then you'll have very little equity (if at all), and be in serious trouble having to re-mortgage. IMHO a 2 year fix is a gamble with odds against you, and your family. You and your family will be much, much safer as tenants - with large savings. We have been renting for many years, have more savings than you, and we've even stopped calling it "a deposit", as we are not planning to buy any time soon - as we are in the SE, and prices here are still stupid. Sounds like you are in the SW, and IMHO prices there are bubbly too. The safest option is to stay out of these huge, gigantic leveraged bets.

That's definitely a risk and i think it's a gamble i think i'm be willing to take at the moment. I've been hoping for a correction to be able to buy at a more sensible price but it's not really happened here in the SW.

The govt has proven they will do everything in their power to sustain ridiculous property prices, they've propped the banks, the big builders, rigged the stock market and the interest rates, turned the BOE into their lapdog to do their bidding. I just don't think they'll let it go now after everything they've chucked at it. It's becoming increasingly obvious that without housing there is no economy

There's always the chance that they'll lose control entirely but it seems to me that the knife edge we were teetering on has widened to the point where there's a bit of room to manoeuvre.

The flip side of that possibility is that in 2 years the market has risen 10% and i'm less able to buy. The reason i like the 2 year fix is that i reckon they'll hold it together at least that long. After the election we may have a new government but i suspect we'll have more of the same policies.

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.

The govt has proven they will do everything in their power to sustain ridiculous property prices, they've propped the banks, the big builders, rigged the stock market and the interest rates, turned the BOE into their lapdog to do their bidding. I just don't think they'll let it go now after everything they've chucked at it. It's becoming increasingly obvious that without housing there is no economy

Wrong. With housing there is no economy. All the stuff government has thrown at high house prices has creared a crash in living standards which now has little scope for further crashing without social unrest, unless you see the future as average house prices =£500k and the majority of people using food banks.

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Where's Zammo when he's needed? People's ability to willingly screw themselves is what allows Osborne to get away with this- secret hopes of HPI, strong wage rises and ZIRP in perpetuity. At what point does it become a reckless gamble rather than George's fault? Anyone who splashes £235k via HTB on a house they can rent for £875pcm down my way either has very exceptional needs or isn't thinking straight. Simple as that.

zammo.jpg

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From some reports it appears that the general public mostly perceive the help to buy schemes as free money. When they find out it isn't, and actually just a scheme that may well put them in fanatical peril at more expense, I doubt the scheme will get the take up the government bandied about, what was it, 5 million lol

HTB1 hasn't been massive has it?

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From some reports it appears that the general public mostly perceive the help to buy schemes as free money. When they find out it isn't, and actually just a scheme that may well put them in fanatical peril at more expense, I doubt the scheme will get the take up the government bandied about, what was it, 5 million lol

HTB1 hasn't been massive has it?

Maybe it's enough to perpetuate the myths about prices only ever going up and when people rush out to find that prices outside of London an the SE haven't really changed since 2004/2006 , they consider the alternatives and decide to jump in, given the promises of low IRs and full on media ramp with a dash of fear that next year might be too late etc. Job done as most believe prices are rising even if actual selling prices are not. The illusion continues... the average UK house price will probably be maintained above 160k, by gov't schemes or outright currency devaluation (printing).

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Bottom line with HTB is the number of pent up demanders who can only buy via HTB1. Their requirements are being met by this scheme as suspiciously few comments about rejections seem to be around. How long it takes for the numbers to drop off should be a good indication of how much sustainable demand there is.

HTB2 is much different and I expect the use of the scheme may be more discretionary, eg people who could buy regardless making a decision about whether to use it or not.

Application numbers are what we need, combined with FTB applications outwith the scheme.

Edited by The B.L.T.
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That's definitely a risk and i think it's a gamble i think i'm be willing to take at the moment. I've been hoping for a correction to be able to buy at a more sensible price but it's not really happened here in the SW.

The govt has proven they will do everything in their power to sustain ridiculous property prices, they've propped the banks, the big builders, rigged the stock market and the interest rates, turned the BOE into their lapdog to do their bidding. I just don't think they'll let it go now after everything they've chucked at it. It's becoming increasingly obvious that without housing there is no economy

There's always the chance that they'll lose control entirely but it seems to me that the knife edge we were teetering on has widened to the point where there's a bit of room to manoeuvre.

The flip side of that possibility is that in 2 years the market has risen 10% and i'm less able to buy. The reason i like the 2 year fix is that i reckon they'll hold it together at least that long. After the election we may have a new government but i suspect we'll have more of the same policies.

Now you sound like a troll again.

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From some reports it appears that the general public mostly perceive the help to buy schemes as free money. When they find out it isn't, and actually just a scheme that may well put them in fanatical peril at more expense, I doubt the scheme will get the take up the government bandied about, what was it, 5 million lol

HTB1 hasn't been massive has it?

Help to buy 1 amassed 10,000 sales in the first 4 months. Doesn't sound a lot but that's 20-25% of new build supply. Builders loving it.

Holy grail will be ftbs using htb2 to buy existing houses so the movers can use HTB1 on higher priced new builds. Taking HTB1 share of new build sales even higher. Stated aim is to encourage building but historically the feedback mechanism is increased price not increased supply.

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Help to buy 1 amassed 10,000 sales in the first 4 months. Doesn't sound a lot but that's 20-25% of new build supply. Builders loving it.

Holy grail will be ftbs using htb2 to buy existing houses so the movers can use HTB1 on higher priced new builds. Taking HTB1 share of new build sales even higher. Stated aim is to encourage building but historically the feedback mechanism is increased price not increased supply.

reservations....they are very careful to point to HTB1 as reservations...not sales.

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I will be considering those, thanks, and obviously the better the rate the happier i'll be.

I was just trying to demonstrate to those that see no value in it that HTB2 could have a use. If you're only copping the high rates for a couple of years before remortgaging in a stronger position it may be worth considering if you can make it work for you.

Different locations have different housing pressures and different people have different needs and priorities, life is complex, there is no one size fits all solution.

Troll from first post on thread. 2 years ago was better time to buy than now. Just spreading FUD on basis of missing the boat.

+1

Definite troll. Maybe a down on his luck mortgage broker struggling with a big IO mortgage on a crap flat, (possible negative equity).

I love the idea of servicing 5% as "high rates" for someone with a 95% mortgage in this economy. Funny stuff. Still good to be reminded that life is complex; it's so easy to forget...

Anyway, don't feed the trolls.

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very interesting post from Honest EA over on anecdotals

http://www.housepricecrash.co.uk/forum/index.php?showtopic=193387&view=findpost&p=909414637

well worth a few minutes of your time

Thanks. That is very interesting.

Sounds like, as a fair few on here have hypothesized, that HTB2 has simply brought about a large increase in activity earlier this year from people who wanted to get in "before HTB2 starts and prices go up".

Now HTB2 is up and running and people realize it is not very attractive nor allows them to afford what they thought it would, things could actually get interesting over the winter months.

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  • 433 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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