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First Time Buyers - 10 Year High


Slimline
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Quite simply, we seem to have a population who will buy anything they can at any price they borrow. Rationality has long gone from the market

 

I can't really blame them, I'm almost sure the government would start wars if it would bump a few % points to HPI each year

 

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38 minutes ago, doomed said:

A friend has recently bought with a 35 year mortgage that was heavily pushed by mortgage advisor.

Takes him right up to 70. Beyond ridiculous.

How much the property? The property debt? How much the income/incomes?

Edited by winkie
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5 minutes ago, winkie said:

How much the property? How much the income/incomes?

Property just over 300k and he earns enough to be higher rate tax payer with partner working part time. Also they put enough down to get decent rate.

This is up North also so average wages will be something pathetic.

Edited by doomed
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2 minutes ago, doomed said:

Property just over 300k and he earns enough to be higher rate tax payer with partner working part time. Also they put enough down to get decent rate.

This is up North also so average wages will be something pathetic.

Well if the monthly repayments allow sufficient to cover other bills and living costs can't see a problem.....it is a challenge managing money when not used to doing it, a lot of satisfaction.... often renting somewhere will be as expensive as a mortgage or higher anyway, and a cash no risk deposit loses money sitting in a savings account, it still might lose in a property but over time most likely will not .....it doesn't have to take 35 years, if things get better can overpay to reduce term..... amazing how much a few pounds overpayment will save on overall interest paid and will shorten the length of the mortgage......;)

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12 minutes ago, zugzwang said:

Too bad the £140bn TFS subsidy has to be repaid over the next four years.

Theres a catch!??

I know a couple whove overstretched for a htb loan.

They hate the estate they live in now - sh1thole, bad neighbours.

Neithers i come hs gone up in the last 5 years. They face a 25% uptick in houding costs.

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9 minutes ago, spyguy said:

Theres a catch!??

I know a couple whove overstretched for a htb loan.

They hate the estate they live in now - sh1thole, bad neighbours.

Neithers i come hs gone up in the last 5 years. They face a 25% uptick in houding costs.

"There's smart money. There's dumb money. And there's money that's so moronic it practically screams for court-ordered sterilisation."

Bill Bonner.

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Thing is, anyone with excel can see how 'cheap' a 35 year mortgage is.

You get about £50 month less for an extra 10 years of repayment. Insane.

I always recommend getting a mortgage that allows overpayment. More so, as irs are ticking up.

Just overpaying 10% more a month can save 1000s.

Theres no miras now, debt is not subbed.

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55 minutes ago, spyguy said:

Thing is, anyone with excel can see how 'cheap' a 35 year mortgage is.

You get about £50 month less for an extra 10 years of repayment. Insane.

I always recommend getting a mortgage that allows overpayment. More so, as irs are ticking up.

Just overpaying 10% more a month can save 1000s.

Theres no miras now, debt is not subbed.

Given that these mortgages are running (way) beyond the age at which you can get hold of your pension, and also current interest rates, it actually makes much more sense to chuck as much money into your pension as possible, not only getting (probably) a much higher rate of return (tax free) than the mortgage rate, but also getting tax free contributions - maybe another 40%. Then pay off with the tax free lump sum at 55.

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1 minute ago, mattyboy1973 said:

Given that these mortgages are running (way) beyond the age at which you can get hold of your pension, and also current interest rates, it actually makes much more sense to chuck as much money into your pension as possible, not only getting (probably) a much higher rate of return (tax free) than the mortgage rate, but also getting tax free contributions - maybe another 40%. Then pay off with the tax free lump sum at 55.

Wooh there with your percentages Poindexter.

Ive borrowed 200k to buy a 3 bed executive apartment in Scunthorpe. Can i get more than 4 EEers per bedroom.....

My gut feeling is that low leverage i.e 60% ltv, 3 lte borrowing will remain lowish - less than 5%. Ive a 10 year fix at well sub 2% but its less than my salary i.e 0.8 lte.

Mortgages for the more leveraged are either going to be painfully high 7%+ Or non existent. I doubt a househol with an income less than 30K will get a mortgage more than 40k.

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21 minutes ago, mattyboy1973 said:

Given that these mortgages are running (way) beyond the age at which you can get hold of your pension, and also current interest rates, it actually makes much more sense to chuck as much money into your pension as possible, not only getting (probably) a much higher rate of return (tax free) than the mortgage rate, but also getting tax free contributions - maybe another 40%. Then pay off with the tax free lump sum at 55.

That is another viable, hopefully alternative........ repayment mortgage with a tax free lump sum option, get out free of debt.;)

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Is the highest FTB levels just a symptom of the BTL crackdown? 

So suddenly FTB who have been saving for years become the new marginal buyers, but also a short term resource to be used up pretty quickly

soon those long term savers will be spent and the next marginal buyer will be the typical low earning small deposit FTB again. 

just by MMR restrictions prices will fall to meet the new lower buying level. 

 

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2 hours ago, spyguy said:

Theres a catch!??

I know a couple whove overstretched for a htb loan.

They hate the estate they live in now - sh1thole, bad neighbours.

Neithers i come hs gone up in the last 5 years. They face a 25% uptick in houding costs.

At least they have a roof over their heads.

I mentioned this on the Aberdeen thread already. A friend of a friend bought a HTB+BOMAD newbuild straight out of university. Everything was going great until she was made redundant and had to move to Edinburgh where she now rents. She currently can't sell the Aberdeen flat and getting consent to let on a HTB mortgage is apparently very difficult.

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1 hour ago, jiltedjen said:

Is the highest FTB levels just a symptom of the BTL crackdown? 

So suddenly FTB who have been saving for years become the new marginal buyers, but also a short term resource to be used up pretty quickly

soon those long term savers will be spent and the next marginal buyer will be the typical low earning small deposit FTB again. 

just by MMR restrictions prices will fall to meet the new lower buying level. 

 

FTB are only one who can afford to move. Usually into ex BTL. 

The rest of market is dead.

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49 minutes ago, GreenDevil said:

FTB are only one who can afford to move. Usually into ex BTL. 

The rest of market is dead.

A bit.

Owner occ are too old to move.

Btler have no access to finance.

Ftb have always provided the liquidity, until btl loons out bufpd them.

Edited by spyguy
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29 minutes ago, spyguy said:

.

Owner occ are too old to move.

 

This seems true.

In my parents leafy nice suburb of Liverpool, where 3 bed semis still seem to go for north of £250k, all but the odd one of the aforesaid 3+ bed semis are in the position that the owners are approaching the position of no longer having the physical ability to maintain the spatious gardens. It's all oldies and no kids. When they've got to that level of decrepitude then of course they're way too old to move house. That's your housing crisis right there.

Edited by Si1
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5 hours ago, spyguy said:

I always recommend getting a mortgage that allows overpayment. More so, as irs are ticking up.

Just overpaying 10% more a month can save 1000s.

Or you could not overpay and use the money to generate a more healthy return on a decent tracker ETF. 

Overpaying now is the low risk option but not the optimal option if you're interested in paying your house off sooner.

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1 hour ago, Si1 said:

This seems true.

In my parents leafy nice suburb of Liverpool, where 3 bed semis still seem to go for north of £250k, all but the odd one of the aforesaid 3+ bed semis are in the position that the owners are approaching the position of no longer having the physical ability to maintain the spatious gardens. It's all oldies and no kids. When they've got to that level of decrepitude then of course they're way too old to move house. That's your housing crisis right there.

yep

I was looking at rightmove at Wroxham.

There is a very nice road there call the avenue with an even nicer road called beech road off it.

Its a very desirable place the main houses on the avenue are in 1/4-1/3 acre plots with a minimum 3 bedrooms very nice.

out of the hundred or so houses on that road 60% have no mortgage.............and only 5 have over 3 people living in them.

Literal family paradise dozens of [email protected]+ houses and pretty much no kids at all.

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5 hours ago, jiltedjen said:

Is the highest FTB levels just a symptom of the BTL crackdown? 

So suddenly FTB who have been saving for years become the new marginal buyers, but also a short term resource to be used up pretty quickly

Exactly, already said by me months ago.  Problem is there are not enough FTB to sustain the market as-is, let alone replace all those BTLer that have stopped buying and started seller, they become net negative to the figures that upset buy/sell power balance.

A symptom of lenders taking way more interest in FTB because their BTL market is dead.

A symptom of the only good news that can be reported is that FTB are at the highest level since yesterday.  Ignoring the larger picture of the levels being no where near the 40 year average FTB level.

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