Bland Unsight Posted March 1, 2014 Share Posted March 1, 2014 (edited) Screen grab from a youtube advert from the Money Advice Service that I saw yesterday on youtube (obviously), thought I would share. For those who don't know the Money Advice Service are, as per their website Background The Money Advice Service was set up as an independent body with responsibility for improving people’s money management in April 2010. We were initially known as the Consumer Financial Education Body, the name used in the Financial Services Act 2010 which sets out our statutory objectives. These are to: enhance the understanding and knowledge of members of the public of financial matters (including the UK financial system); and enhance the ability of members of the public to manage their own financial affairs. Our statutory functions include, but are not limited to: promoting awareness of the benefits of financial planning; promoting awareness of the financial advantages and disadvantages in relation to the supply of particular kinds of goods or services; promoting awareness of the benefits and risks associated with different kinds of financial dealing, which includes informing the Financial Conduct Authority and other bodies of those benefits and risks; publishing educational materials or the carrying out of other educational activities; and providing information and advice to members of the public. We launched as the Money Advice Service in April 2011 once our online, telephone and UK-wide face-to-face advice services were in place. In April 2012 we took on additional responsibility for funding and improving the quality, consistency and availability of debt advice. Our statutory functions in relation to debt advice, as set out in the Financial Services Act 2012, are to: assist members of the public with the management of debt; work with other organisations which provide debt services, with a view to improving: the availability to the public of those services; the quality of the services provided; and consistency in the services available, in the way in which they are provided and in the advice given. Source: https://www.moneyadviceservice.org.uk/en/static/background Here's the advert Edited March 1, 2014 by ChairmanOfTheBored Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted March 1, 2014 Share Posted March 1, 2014 (edited) Pity they're reinforcing the idea that buying in the current market is sensible as long as you're aware of all the associated household bills: "Living in a new home should be amazing ... So, before you buy, keep nasty surprises to a minimum by planning for all your ongoing costs" They failed to mention the risks of negative equity or give any warning about the future perils of interest rate rises. If 1 in 5 FTBs are already regretting their purchases how many more will do so when rates rise or prices fall? Even if the BoE manages to put rate rises off for years it's highly unlikely that there won't be significant rises within the lifetime of most FTB mortgages, just as it's unlikely that current overinflated prices will be maintained over the same period without massive (and so far unforthcoming) wage inflation. Both these issues represent far greater financial risk than having forgotten to allocate money for utilities, repairs or council tax. Whatever MAs position in relation to the likelihood of these risks actually manifesting they should be advising people that they exist in potentia. Edited March 1, 2014 by Lo-fi Quote Link to comment Share on other sites More sharing options...
fleabag Posted March 2, 2014 Share Posted March 2, 2014 Thought people might find this article as interesting as I did:- https://www.moneyadviceservice.org.uk/en/news/too-many-first-time-buyers-blow-their-home-buying-budgets-14022014?utm_source=d-outb&utm_medium=content&utm_term=ntwk&utm_content=d-hot-topics-mortgages&utm_campaign=d-outbrain Quote Link to comment Share on other sites More sharing options...
Bland Unsight Posted March 2, 2014 Author Share Posted March 2, 2014 Thought people might find this article as interesting as I did:- https://www.moneyadviceservice.org.uk/en/news/too-many-first-time-buyers-blow-their-home-buying-budgets-14022014?utm_source=d-outb&utm_medium=content&utm_term=ntwk&utm_content=d-hot-topics-mortgages&utm_campaign=d-outbrain Mods: May I be so bold as to propose that this thread is merged with this one, presently on the second page? fleabag - I found it interesting but my thread didn't exactly rock the socks off the hpc massive. I think that it's one of those funny things where organisations set up and provided with budgets in the immediate wake of the financial crisis are now 'off message' as we appear to be adopting a strategy of pretending that these house prices and the massive debts that back them aren't bonkers. You could argue it's picking winners and that the winners that have been picked are the banks and the builders. Hence, whereas you have a small de facto arm of government, like the Money Advice Service, spending money trying to wake people up to the fact that a massive mortgage is no picnic at the self-same time that you have Osborne and Cameron pimping debt via Help to Buy that may be very tricky to service is we run into another decent recession at a time when the Bank of England's ability to hold interest rates at rock bottom is impaired by external factors. Hey ho. Quote Link to comment Share on other sites More sharing options...
underscored Posted March 2, 2014 Share Posted March 2, 2014 Mods: May I be so bold as to propose that this thread is merged with this one, presently on the second page? fleabag - I found it interesting but my thread didn't exactly rock the socks off the hpc massive. I think that it's one of those funny things where organisations set up and provided with budgets in the immediate wake of the financial crisis are now 'off message' as we appear to be adopting a strategy of pretending that these house prices and the massive debts that back them aren't bonkers. You could argue it's picking winners and that the winners that have been picked are the banks and the builders. Hence, whereas you have a small de facto arm of government, like the Money Advice Service, spending money trying to wake people up to the fact that a massive mortgage is no picnic at the self-same time that you have Osborne and Cameron pimping debt via Help to Buy that may be very tricky to service is we run into another decent recession at a time when the Bank of England's ability to hold interest rates at rock bottom is impaired by external factors. Hey ho. It's like a slow motion car crash. Quote Link to comment Share on other sites More sharing options...
Bland Unsight Posted March 2, 2014 Author Share Posted March 2, 2014 It's like a slow motion car crash. That's the magic of low interest rates. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted March 2, 2014 Share Posted March 2, 2014 Thought people might find this article as interesting as I did:- https://www.moneyadv...aign=d-outbrain It is interesting, but again the possibility of negative equity and rising interest rates are conspicuous in their absence. Quote Link to comment Share on other sites More sharing options...
tomandlu Posted March 2, 2014 Share Posted March 2, 2014 It's like a slow motion car crash. I know. Truly horrible. Some of the passengers deserve what's coming to them, and some don't. In any event, the whole sorry saga, from beginning to end, is a disgrace. Quote Link to comment Share on other sites More sharing options...
SNACR Posted March 3, 2014 Share Posted March 3, 2014 I know. Truly horrible. Some of the passengers deserve what's coming to them, and some don't. In any event, the whole sorry saga, from beginning to end, is a disgrace. What really annoys me is that rather than a proper reset being permitted in 2008, five years and counting, of prudent people's lives have been squandered in Zombieland. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 3, 2014 Share Posted March 3, 2014 Thought people might find this article as interesting as I did:- https://www.moneyadviceservice.org.uk/en/news/too-many-first-time-buyers-blow-their-home-buying-budgets-14022014?utm_source=d-outb&utm_medium=content&utm_term=ntwk&utm_content=d-hot-topics-mortgages&utm_campaign=d-outbrain Lots of worthwhile information, still think many are walking into buying with their eyes closed......easy for people to say stretch yourselves, we are now living in different times than our parents, wages are not rising in pace with living costs, today there are so many extra costs and things to buy and to think about that were not there that long ago......buying a home is a long-term commitment that can tie you in for many years, get it wrong and it can set you back years.....buyer beware. Quote Link to comment Share on other sites More sharing options...
Venger Posted March 3, 2014 Share Posted March 3, 2014 I know. Truly horrible. Some of the passengers deserve what's coming to them, and some don't. In any event, the whole sorry saga, from beginning to end, is a disgrace. Deserves got nothing to do with it. You're either on the right side of the equation or you are not. Many here haven't deserved to be outbid for 10 years and more. Did they deserve that? All the energy on searching out for some 'heart-breaking' cases of some over-indebted 'nice' people who "just wanted a home" with big mortgage or not realising incomes can change, is a hindrance to correction. Quote Link to comment Share on other sites More sharing options...
@contradevian Posted March 3, 2014 Share Posted March 3, 2014 A decision to buy a home shouldn't be like this. Like betting it all on black. Quote Link to comment Share on other sites More sharing options...
19 year mortgage 8itch Posted March 3, 2014 Share Posted March 3, 2014 A decision to buy a home shouldn't be like this. Like betting it all on black. You still have the choice not to bet. Funny how so few people choose the no win/no lose situation. Quote Link to comment Share on other sites More sharing options...
Venger Posted March 3, 2014 Share Posted March 3, 2014 A decision to buy a home shouldn't be like this. Like betting it all on black. Well some of us haven't bought, and still saving. It's a decision not to buy, at such high prices, for many of us. People aren't forced to buy. If there were fewer buyers it would put pressure on house prices. If buyers want to bet and expose themselves to the market, in buying, that's their decision. Buyers have free-will. They have all the same access to market information as anyone else. They may just not want to spend any time doing same level of deep research as others do/have done - as they have important lives to lead, and entitled to ownership. Buyers are still buying, with transactions going up, and overall HPI up a lot too, year-on-year. Paying higher prices. No sympathy required. It's not like we've even had the slightest real softening in prices at all, just even more HPI (in my area anyway), yet everyone's primed for sobbing for the buyers. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 3, 2014 Share Posted March 3, 2014 A decision to buy a home shouldn't be like this. Like betting it all on black. ....not that bad, what it is is part of a long-term plan, no easy get quick rich, speculative trading, buy it spend a couple of grand and make a few thousand more in six months time......a house is a home not an investment, that can take years to achieve. Quote Link to comment Share on other sites More sharing options...
Eddie_George Posted March 3, 2014 Share Posted March 3, 2014 It's like a slow motion car crash. All the money pumped into housing, the stock market and tech firms around the world will evaporate in an instant. So much malinvestment. The next crash will make 2007-2008 seem like a walk in the park. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted March 3, 2014 Share Posted March 3, 2014 Well some of us haven't bought, and still saving. It's a decision not to buy, at such high prices, for many of us. People aren't forced to buy. If there were fewer buyers it would put pressure on house prices. If buyers want to bet and expose themselves to the market, in buying, that's their decision. Buyers have free-will. They have all the same access to market information as anyone else. They may just not want to spend any time doing same level of deep research as others do/have done - as they have important lives to lead, and entitled to ownership. Buyers are still buying, with transactions going up, and overall HPI up a lot too, year-on-year. Paying higher prices. No sympathy required. It's not like we've even had the slightest real softening in prices at all, just even more HPI (in my area anyway), yet everyone's primed for sobbing for the buyers. Contemporary culture seems to pre-dispose people to deny personal responsibility or culpability for anything, I suppose they expect a trickle down version of privatise the profits socialise the losses? Anecdotally the amount of whining that I've listened to in person over the "bad luck" of poor outcomes born of personal choices is really rather astounding, as is the level of vitriol expressed when any sense of cause and effect is injected into the conversation. This seems to be born out by the mainstream media's recent parade of angry flooded householders who very rarely acknowledged that they had made a personal choice to live on a floodplain and that noone was forcing them them to live there. Aside from the endless attempts to blame this on the environment agency and government response choice comments were along the general lines of (from memory) "we're not even on the flood plain but we still got flooded" (then you're on the flood plain), "flooding insurance is just a postcode lottery" (so nothing to do with being on a flood plain then?), "we can't even see the river so how could we know that we might get flooded?" (because you're on the same level as the river bank and it's only a row of houses away?), "insurance companies should buy enough equipment to dry out everyone's houses at the same time" (because that would clearly be commercially viable). Delusional Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted March 3, 2014 Share Posted March 3, 2014 All the money pumped into housing, the stock market and tech firms around the world will evaporate in an instant. So much malinvestment. The next crash will make 2007-2008 seem like a walk in the park. The other question is will the associated debt evaporate just as quickly? I'd hope not given the moral hazard involved but I really don't know how likely a debt amnesty would be in the circumstances. Quote Link to comment Share on other sites More sharing options...
R K Posted March 3, 2014 Share Posted March 3, 2014 Fast motion car crash. Slow motion reflation. Quote Link to comment Share on other sites More sharing options...
tomandlu Posted March 3, 2014 Share Posted March 3, 2014 Well some of us haven't bought, and still saving. It's a decision not to buy, at such high prices, for many of us. People aren't forced to buy. If there were fewer buyers it would put pressure on house prices. If buyers want to bet and expose themselves to the market, in buying, that's their decision. Buyers have free-will. They have all the same access to market information as anyone else. They may just not want to spend any time doing same level of deep research as others do/have done - as they have important lives to lead, and entitled to ownership. Buyers are still buying, with transactions going up, and overall HPI up a lot too, year-on-year. Paying higher prices. No sympathy required. It's not like we've even had the slightest real softening in prices at all, just even more HPI (in my area anyway), yet everyone's primed for sobbing for the buyers. And yet you still (afaict) support the idea that house-prices should be governed by nothing but market-forces, with no limit on the amount of debt that people can take on or that banks can extend. I get why you would want this (assuming I've not misconstrued your position), but it flies in the face of reality, which is that market-forces will continue to be only one factor at play, and the other factors do not behave in such a logical fashion. After 15 years of this nonsense, there are no real winners, and nor can there be - from the over-indebted to those that held back and watched their savings eaten away by inflation or their assets subject to a precarious market - we've all been shafted. Great - there are some goodies and baddies - but, personally, that gives me little comfort. Quote Link to comment Share on other sites More sharing options...
Venger Posted March 3, 2014 Share Posted March 3, 2014 (edited) And yet you still (afaict) support the idea that house-prices should be governed by nothing but market-forces, with no limit on the amount of debt that people can take on or that banks can extend. I get why you would want this (assuming I've not misconstrued your position), but it flies in the face of reality, which is that market-forces will continue to be only one factor at play, and the other factors do not behave in such a logical fashion. After 15 years of this nonsense, there are no real winners, and nor can there be - from the over-indebted to those that held back and watched their savings eaten away by inflation or their assets subject to a precarious market - we've all been shafted. Great - there are some goodies and baddies - but, personally, that gives me little comfort. There have been winners. Buyers have been big winners in all but the most deprived of areas. Their homes being worth a lot more than they paid for them. For years in all the areas I track, we're still seeing big flips here. Even what looks like flip-on-flip. (Flipper flips at higher price to new flipper). And buyers have been paying the higher prices. It doesn't matter why they have, they have, and it's their choice. Forgive them when they pay 2-3 what I think they're worth and what some senior positioned younger hopeful buyers in my family think they're worth? NO. It's not even like the manic values are bringing out much by way of inventory to market, owners complacent to the HPI and manic values their homes are worth, as prices go higher even still, and I keep hearing your position about the sadness for the buyers. Many buyers are enthusiastic buyers. No doubt you could point to those who can't trade up on their first purchase starter homes, but I can show you a recent case of a buyer who wants HPI on her newbuild flat to 'win' in the market (vs renters). They can see for a profit most places. It's not my fault even the Money Advice Service say this, which is in the minds of millions of other people too (especially older people pushing the same idea). Benefits of owning your home If your home increases in value you can use that equity to help you afford a bigger home or to fund a more comfortable retirement if you downsize. So many of your posts are laced with sympathy for buyers, yet I'm just seeing buyers set higher prices in the market. Yes; I'm happy to allow market forces to play out and all the hidden drags that come with market interventions and malinvestment take their toll in other ways, eventually causing big weaknesses to manifest themselves in the market (I hope). If basic opportunity has been taken away from me because of the reckless malinvestment of others (including buyers at ever higher stupid prices), then I can hope for more balanced market situation for the young of the future, rather than constant sympathy protect the VI buyer HPI who did no wrong paying ever higher prices out of their own free-will. Good post Lo-fi. Totally agree. Edited March 3, 2014 by Venger Quote Link to comment Share on other sites More sharing options...
tomandlu Posted March 3, 2014 Share Posted March 3, 2014 (edited) There have been winners. Buyers have been big winners in all but the most deprived of areas. Their homes being worth a lot more than they paid for them. But the point your missing that I tried to make is that you seem to want more of this - a heavily-financialised housing market in a non-free-market economy (you can tell it isn't a free-market because it's real life). Please stop being distracted by my 'sympathy' - it extends little further than 'poor sods, oh well'. BTW... Benefits of owning your home If your home increases in value you can use that equity to help you afford a bigger home or to fund a more comfortable retirement if you downsize. Did they really say this? FFS... as the yanks say, do the maths... Edited March 3, 2014 by tomandlu Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted March 3, 2014 Share Posted March 3, 2014 And yet you still (afaict) support the idea that house-prices should be governed by nothing but market-forces, with no limit on the amount of debt that people can take on or that banks can extend. I get why you would want this (assuming I've not misconstrued your position), but it flies in the face of reality, which is that market-forces will continue to be only one factor at play, and the other factors do not behave in such a logical fashion. If government subsidisation of the financial sector and the entire concept of "too big to fail" was removed the banks would soon learn to reduce credit levels to more sensible levels. Equally if the housing market was allowed to drop and forebearance on arrears was severely limited people would start to think more carefully about how much debt they were taking on. It would probably take quite a few repossessions plus the odd bank going bust to send the message home so that the remainder no longer held out any illusions of further bail outs, but at some point self-preservation would have to kick in and we would all be better off in the long run. Purists might disagree but I don't think an unregulated market and a free market are the same thing. Without sufficient regulation cartels, corporate lawyers, special interest groups, lobbyists and politicians quickly make the market anything but free. But it must be possible to create a regulatory framework purely designed to prevent this kind of co-opting and attain as close as is possible to free market operation in a real world setting, much as we currently have laws against slavery that do not in-and-of-themselves impinge on the freedom of the labour market. Quote Link to comment Share on other sites More sharing options...
underscored Posted March 3, 2014 Share Posted March 3, 2014 There have been winners. Buyers have been big winners in all but the most deprived of areas. Their homes being worth a lot more than they paid for them. For years in all the areas I track, we're still seeing big flips here. Even what looks like flip-on-flip. (Flipper flips at higher price to new flipper). And buyers have been paying the higher prices. It doesn't matter why they have, they have, and it's their choice. Forgive them when they pay 2-3 what I think they're worth and what some senior positioned younger hopeful buyers in my family think they're worth? NO. It's not even like the manic values are bringing out much by way of inventory to market, owners complacent to the HPI and manic values their homes are worth, as prices go higher even still, and I keep hearing your position about the sadness for the buyers. Many buyers are enthusiastic buyers. No doubt you could point to those who can't trade up on their first purchase starter homes, but I can show you a recent case of a buyer who wants HPI on her newbuild flat to 'win' in the market (vs renters). They can see for a profit most places. It's not my fault even the Money Advice Service say this, which is in the minds of millions of other people too (especially older people pushing the same idea). So many of your posts are laced with sympathy for buyers, yet I'm just seeing buyers set higher prices in the market. Yes; I'm happy to allow market forces to play out and all the hidden drags that come with market interventions and malinvestment take their toll in other ways, eventually causing big weaknesses to manifest themselves in the market (I hope). If basic opportunity has been taken away from me because of the reckless malinvestment of others (including buyers at ever higher stupid prices), then I can hope for more balanced market situation for the young of the future, rather than constant sympathy protect the VI buyer HPI who did no wrong paying ever higher prices out of their own free-will. Good post Lo-fi. Totally agree. There are definite winners. Not by the sweat of their brow... In fact some pig-ignorant risk takers... Quote Link to comment Share on other sites More sharing options...
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