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Article On Ftb`s

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There is an article in the observer saying FTB`s are entering the housing market in droves.

It states that applications for mortgages from FTB`s rose from 10% to 20% in december.

Do you think this could help prolong the high prices in the UK?

I think its the low interest rates that are attracting FTB`s

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There is an article in the observer saying FTB`s are entering the housing market in droves.

It states that applications for mortgages from FTB`s rose from 10% to 20% in december.

Do you think this could help prolong the high prices in the UK?

I think its the low interest rates that are attracting FTB`s

LINK

I think we'll see some increases in prices in the next couple of months. We keep hearing reports of sales picking up in December and January, and a lot of the houses I was keeping an eye on Rightmove have sold, so I'm bracing myself for a barrage of bullish smugness in the press.

However, the amount of properties that seem to have gone on sale since the new year seems to be enormous, so I think the 'recovery' will be short-lived.

My girlfriend texted me today to tell me that she saw a 3 bedroom town house in Cardiff Bay advertised for more than £500k. As far as I'm concerned, things like that are proof, if ever it was needed, that this is a speculative bubble rather than long-term shift in value of property.

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There is an article in the observer saying FTB`s are entering the housing market in droves.

It states that applications for mortgages from FTB`s rose from 10% to 20% in december.

Do you think this could help prolong the high prices in the UK?

I think its the low interest rates that are attracting FTB`s

LINK

I think there been a few FTB who have stayed back from buying in 2005.

Saw in the press that market prices looked, stable, they've decided it's not going to crash, an so are buying now.

Thing is, they can't afford to buy, so Mum & Dad are helping out re-mogaging their own home... etc.

This will keep the market going for some time.

Once the FTBs with Rich Mums & Dads have finished, there will be no more FTBs coming into the market....

If I'm correct, looking for a strangely high number of morgages to actual sales. (M&D's new morgage & FTBs new morgage for 1 sale), within the stats for the first quarter of 2006.

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I think there been a few FTB who have stayed back from buying in 2005.

Saw in the press that market prices looked, stable, they've decided it's not going to crash, an so are buying now.

Thing is, they can't afford to buy, so Mum & Dad are helping out re-mogaging their own home... etc.

This will keep the market going for some time.

Once the FTBs with Rich Mums & Dads have finished, there will be no more FTBs coming into the market....

If I'm correct, looking for a strangely high number of morgages to actual sales. (M&D's new morgage & FTBs new morgage for 1 sale), within the stats for the first quarter of 2006.

I'd LOVE to believe that the 'Two-mortgages-for-one-house' mechanism you describe explains the unseasonally high number of house-purchase mortgages reported by the BoE recently. BUT, I think that even if Mum & Dad are helping the litle 'uns out financially, they would probably be doing it by MEWing off of their own property and merely extending an existing mortgage, not creating a new one.

Alas, I cannot come up with another explanation for the recently bullish figures & observations, other than houses ARE selling. Where's the money coming from? God knows!

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Hmmmm, interesting.

Maybe a FTB isn't what they appear.

I am renting (I'm a STR due to relocation) and have just been approved for a mortgage.

The way the Mortgage Broker was talking, it seems I am being seen as a First Time Buyer.

Maybe some of these FTB's are actually STR's???????

All I know is, if FTB 's couldn't afford to buy 1-2 years ago when prices were lower and interest rates were lower, how can they be able afford to buy now, as both prices and interest rates have gone up.

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I am renting (I'm a STR due to relocation) and have just been approved for a mortgage.

Did you apply for a mortgage, or were you approved anyway? A couple of posters have recently commented that they were approved for a mortgage without applying, I wonder if this is commonplace?

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Let's not get carried away by a supposed increase in FTB numbers.

If you focus on month on month changes you are always going to see large variations, if you don't report falls in the previous month but make headlines when they recover the month after then you can generate "good news". Selective reporting does not make a change in the market.

You have to look at these figures over longer timespans, quarterly at least.

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Hrm, if many of these mortgage brokers are part of EA groups then what's to stop them accidentally ticking the wrong box? Even the CML admit that at least 20% of those classified as FTB'ers are actually "returners" buying with money from previous property.

Melanie Bien, associate director at independent broker Savills Private Finance, suggests you 'think creatively'. For example, if you are attracted to a first-time buyer deal because you can't afford the fees on standard mortgages, consider adding them to the loan. Most lenders will allow this, although you will pay interest on the fee.

Did you read that? Dear lord, next they will be actively encouraging people to knock over old lady's for their handbags or dealing a little crack on the side!

Opps, they have :-

The message is clear: save, beg or borrow for a bigger deposit and you will have more to spend on furniture and entertaining friends in your new home.

I believe the accept phrase is steal, beg or borrow!

Edited by BuyingBear

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Just had another thought.

Maybe the actual number of FTB's is roughly the same.

But, the number of of other applicants has dropped, e.g BTL's has dropped.

Therefore, FTB's make up a bigger %, even though, physically there is still the same amount.

If they gave it to us in actual numbers of FTB's and not percentages, then you would get the true picture.

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It states that applications for mortgages from FTB`s rose from 10% to 20% in december.

Thats nothing. Postings on housepricecrash.co.uk from heresjohnny show a 100% increase over the course of the last hour. (Sources refuse to comment that it is only the second posting of the day and therefore does not indicate a significant change in market conditions)

Saying that I know a couple of people who are feeling "relieved" to have got on the ladder "while they still could" so people are always going to be buying. I suppose if the number of people re-mortgaging or BTLing reduces then as a proportion FTB will increase.

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Did you apply for a mortgage, or were you approved anyway? A couple of posters have recently commented that they were approved for a mortgage without applying, I wonder if this is commonplace?

We "applied". The Mortgage Advisor came round one evening. We didn't fill out any forms though. I gave him a spread sheet of all our income/expenses etc, and he came back a few days later and said we could borrow upto 110K.

We are a bit of an unconventional case - not lie to buy, just creative accounting :)

For more insight see my recent post on the thread "Should I buy a Housing Association Flat."

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Thing is, they can't afford to buy, so Mum & Dad are helping out re-mogaging their own home... etc.

This will keep the market going for some time.

I know several people whos mum and dad have helped out one up to 100K. That's alot of help and a lot of life savings to disappear when the market goes pop.

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The strictest definition of a FTB is some-one whose name has not appeared on a mortgage title deed before.

I believe it was the CML saying FTB had reached a low at about 7% within the past couple of weeks: if this has shot up to 20% I would be surprised.

There are sadly I suspect ignorant FTB fuelled by media headlines and 'rent is dead money' who are still buying. They have not looked into property much, have no conception that it might be over-valued, and certainly have never heard of the Greater fool Theory of investing. Others are impatient. Others think 'Spring is in the air. I want a house. Let's go to the estate agents...'

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While I agree about the definition of what a real FTB is, I suspect that for many of these statistics the term simply means someone buying without currently owning. So there will be some STR's mixed in there too. I think we are seeing a slight dead cat bounce. I'll admit I could be wrong and what I see worries me slightly. But we're not where I expected it to be.

I thought we'd see a bigger fall in the last half of 2005 and I thought this period would be flat. However, my opinion of a long term slide in prices is unchanged. This is because the factors which led me to believe prices were out of kilter are still present. Indeed, seeing the possibility of rises at this point of he cycle leads me to believe the falls will eventually be harder.

Edited by Portent

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There is an article in the observer saying FTB`s are entering the housing market in droves.

It states that applications for mortgages from FTB`s rose from 10% to 20% in december.

Do you think this could help prolong the high prices in the UK?

I think its the low interest rates that are attracting FTB`s

LINK

I think that while we HPCers like to think we're the enlightened few, there are actually quite a few people with money in their pockets, ready at some point in the next year or two to plough that cash into property.

While I know lots of debt monkeys I also know just as many dillegent savers. Even the property porn TV shows have many a FTB with a decent deposit. I think some of this spare cash needs to be ploughed into housing creating the final spike before we see a serious longer term adjustment.

It could happen this spring with panic buying by people in their 30's who are plopping themselves that they might miss another boat. Who knows. Like a few others I'm bracing myself for some bullish news over the next few months. Money supply up, mortage lending up, house prices up, interest rates likey to fall 0.25% in the next month or two, bullish VI spin, confidence returning amongst the proles all points to a short term upward trend. I reckon there are a few more fools who need to buy.

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Statisstics again, when there are less of the btl brigade then ftb's will comparitively be higher but not neccessarily in numbers in fact they may be down.

Keep your guard up people, as they show no references with figures to my knowledge.

Edited by crash test dummy

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The headline of this article is "Danger lurks for first time buyers"

The first line of this article is "If recent reports are to be believed...."

Secondly, an increase of 100% in mortgage applications is not the same thing as and increase of 100% in mortgages granted. And its even further away from a 100% increase in the value of loans given.

Above all this though is proof positive (IMO) that a HPC is underway.

Consider this - if 20% of the market for mortgages are FTBs who are the other 80%?

1 - Speculators?

If 80% of the mortgage market is going to speculators then either a ) there are very few mortgage applications being made or B ) we are about to see the mother-of-all speculative bubbles.

2 Or people trading-up?

Assuming that 1 mortgage = 1 house we can assume that a fair portion of that 80% have properties to sell.

Thus, a reduction in prices is inevitable. Only 20% buying in at the bottom and, say, 40% trying to sell at the top?

3 Re-mortgages?

If this is the case then the mortgage market is fairly stagnant, with banks essentially "swapping" money between themselves and dressing it up as "activity".

Any takers?

Edited by needle

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I think that while we HPCers like to think we're the enlightened few, there are actually quite a few people with money in their pockets, ready at some point in the next year or two to plough that cash into property.

While I know lots of debt monkeys I also know just as many dillegent savers. Even the property porn TV shows have many a FTB with a decent deposit. I think some of this spare cash needs to be ploughed into housing creating the final spike before we see a serious longer term adjustment.

It could happen this spring with panic buying by people in their 30's who are plopping themselves that they might miss another boat. Who knows. Like a few others I'm bracing myself for some bullish news over the next few months. Money supply up, mortage lending up, house prices up, interest rates likey to fall 0.25% in the next month or two, bullish VI spin, confidence returning amongst the proles all points to a short term upward trend. I reckon there are a few more fools who need to buy.

I tend to agree with you about all the reasons for a surge in HPI in the next few months. I'm no longer convinced however that there will be a "serious longer term adjustment". I think, annoying though it is, we may be seeing a soft landing. It may just be that people are prepared to spend the money, in which case it doesn't matter how much we'd all like houses to cost.

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I think, annoying though it is, we may be seeing a soft landing. It may just be that people are prepared to spend the money, in which case it doesn't matter how much we'd all like houses to cost.

I think, annoying though it is, that you are being swayed by the VI spin.

I don't accept the argument that people are willing to spend the money, quite simply they can't spend what they don't have. House prices are certain to return to trend values, the only argument is over the time span.

The recent spin over increases in FTB's look like the start of the real crash to me, with VI's searching for any good news to try to delay the inevitable. They may be able to trick some new money into the market but the won't change the long term path.

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I think, annoying though it is, that you are being swayed by the VI spin.

I don't accept the argument that people are willing to spend the money, quite simply they can't spend what they don't have. House prices are certain to return to trend values, the only argument is over the time span.

The recent spin over increases in FTB's look like the start of the real crash to me, with VI's searching for any good news to try to delay the inevitable. They may be able to trick some new money into the market but the won't change the long term path.

Well, I sincerely hope you are right. But I start 2006 with far less belief that we are headed for a crash than I have been recently. I don't think we are going to see a boom, but I'm rapidly losing confidence that prices will actually fall significantly. I hope I'm wrong, and I may well be. But that's the way I'm starting to see it. Could just be a phase.....

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  • 302 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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