Sour Mash Posted June 17, 2020 Share Posted June 17, 2020 27 minutes ago, blackhole said: The government cannot magic up millions of jobs, though. What good will all this intervention be, if there's simply not the confidence in the job market? TBC: Sept onwards. Mortgages are denominated in pounds sterling. The government can, and will, and will have no choice but to, magic these up in massive amounts to fund all sorts of things. Bad news for people with savings, pretty good news for people with asset (property in this case) and debt against said assets. Quote Link to comment Share on other sites More sharing options...
PalmerEldritch Posted June 17, 2020 Share Posted June 17, 2020 8 minutes ago, Speed1987 said: Aren't most banks deep into property though? If the property market fails, doesn't that mean they fail also... In raw capitalism, they'd be ******ed, but the government always bail them out, somehow. The banks have been stress tested by a 30% hpc since the GFC. They’ll be fine but the idiots who have over stretched their selves this last 10 years will be in big trouble. F**k them. Quote Link to comment Share on other sites More sharing options...
Speed1987 Posted June 17, 2020 Share Posted June 17, 2020 3 minutes ago, PalmerEldritch said: The banks have been stress tested by a 30% hpc since the GFC. They’ll be fine but the idiots who have over stretched their selves this last 10 years will be in big trouble. F**k them. Yea possibly, but that's not all of us. I went for somthing sensible for my first purchase, I'll jump up the ladder later. Possibly after this, if a significant crash occurs. Quote Link to comment Share on other sites More sharing options...
blackhole Posted June 17, 2020 Share Posted June 17, 2020 (edited) 8 minutes ago, Sour Mash said: Mortgages are denominated in pounds sterling. The government can, and will, and will have no choice but to, magic these up in massive amounts to fund all sorts of things. Bad news for people with savings, pretty good news for people with asset (property in this case) and debt against said assets. Would it not make more sense, realistically, to spend that money on infrastructure programmes that could lead to actual growth, not zombie economy++ ? They do have a choice. Just want to point out that it appears everyone thinks the gov will default to "saving heavily indebted mortgage types". You really think so? ... Edited June 17, 2020 by blackhole Quote Link to comment Share on other sites More sharing options...
blackhole Posted June 17, 2020 Share Posted June 17, 2020 (edited) 21 minutes ago, Speed1987 said: Aren't most banks deep into property though? If the property market fails, doesn't that mean they fail also... In raw capitalism, they'd be ******ed, but the government always bail them out, somehow. Lehman brothers hit the wall hard. It's happened before. As did northern rock. Edited June 17, 2020 by blackhole Quote Link to comment Share on other sites More sharing options...
xxxx Posted June 17, 2020 Share Posted June 17, 2020 14 minutes ago, blackhole said: Lehman brothers hit the wall hard. It's happened before. As did northern rock. This happened two weeks ago: Britain’s lenders are being asked by the Bank of England to give details on their expected losses on loans due to the coronavirus crisis as the sector is braced for a wave of borrower defaults. They are prepared for all the default/repossessions coming. They will not be saved. They have supported enough already. They realise what a sh@tshow this will be. I think a couple of banks will go under with mortgage defaults. Quote Link to comment Share on other sites More sharing options...
Switch625 Posted June 17, 2020 Share Posted June 17, 2020 5 hours ago, HovelinHove said: Your last point is why any optimism in the market at the moment is ill founded. Most chains have an FTB at the bottom, but also if I am reading this correctly, anyone moving up the chain must have at least a 15% deposit. If they can’t an over inflated price for their 500 sq ft apartment they bought on HTB 4 years ago, then they won’t be moving up. This will be a slow burn as anyone who is not forced to sell will be allowed to stay put, but forced sellers will lead the charge down. September is when things will really kick off, maybe October. +1 Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted June 17, 2020 Share Posted June 17, 2020 47 minutes ago, blackhole said: Would it not make more sense, realistically, to spend that money on infrastructure programmes that could lead to actual growth, not zombie economy++ ? They do have a choice. Just want to point out that it appears everyone thinks the gov will default to "saving heavily indebted mortgage types". You really think so? ... The mortgage market is THE major private sector credit pump and how most newly created 'money' (ie. bank credit) makes it into the pockets of the consumer. It's imperative to economic policy to keep it going. On top of that, should there be a HPC the bankers stand to lose a lot of money and we can't have that now. Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted June 17, 2020 Share Posted June 17, 2020 55 minutes ago, PalmerEldritch said: The banks have been stress tested by a 30% hpc since the GFC. They’ll be fine but the idiots who have over stretched their selves this last 10 years will be in big trouble. F**k them. If you believe they actually passed such a stress test fairly, I've got some land in Florida to sell you. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted June 17, 2020 Share Posted June 17, 2020 1 hour ago, Speed1987 said: Plenty of inflation, to erode debt. I think that's more realistic. Yes. And what comes with higher inflation? Rates... Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted June 17, 2020 Share Posted June 17, 2020 1 hour ago, whynow said: Looks like i’ll Be out of the housing market and saving for another 2 years to get to that 15% -unless they reverse this decision or house prices plummet. But perhaps it’s all just as well! I believe, in 2 years, you will realise how lucky you are. Quote Link to comment Share on other sites More sharing options...
sPinwheel Posted June 17, 2020 Share Posted June 17, 2020 18 minutes ago, Killer Bunny said: I believe, in 2 years, you will realise how lucky you are. I think you have said that for 2 decades. Keep hoping. Quote Link to comment Share on other sites More sharing options...
Drummer Posted June 17, 2020 Share Posted June 17, 2020 41 minutes ago, Killer Bunny said: I believe, in 2 years, you will realise how lucky you are. I thought the time was now? Changed your mind? Houses are being snapped up all over the place. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted June 17, 2020 Share Posted June 17, 2020 (edited) Spinwheel, I think you are somewhat right and somewhat wrong. No question I was wrongly early from early 2000s. Then right from 2006 to 2012. Then HTB came, when I immediately said prices will now rise for a few years. Then I turned bearish again, medium to long terms. Read I Told You thread. And who cares whether I’m right or wrong? We will all make decisions for ourselves based on what we expect. I’ve laid out what I expect in ITY. Edited June 17, 2020 by Killer Bunny Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted June 17, 2020 Share Posted June 17, 2020 4 minutes ago, Drummer said: I thought the time was now? Changed your mind? Houses are being snapped up all over the place. Crap interpretation of what I said and have been saying. Quote Link to comment Share on other sites More sharing options...
sPinwheel Posted June 17, 2020 Share Posted June 17, 2020 3 minutes ago, Drummer said: I thought the time was now? Changed your mind? Houses are being snapped up all over the place. Oh it's different this time. Quote Link to comment Share on other sites More sharing options...
zugzwang Posted June 17, 2020 Share Posted June 17, 2020 4 minutes ago, Killer Bunny said: I think you are somewhat right and somewhat wrong. No question I was wrongly early from early 2000s. Then right from 2006 to 2012. Then HTB when I said prices will now rise for a few years. Then I turned bearish again, medium to long terms. Read I Told You thread. And who cares whether I’m right or wrong? We will all make decisions for ourselves based on what we expect. I’ve laid out what I expect in ITY. https://wonderopolis.org/wonder/why-are-they-called-flip-flops Quote Link to comment Share on other sites More sharing options...
sPinwheel Posted June 17, 2020 Share Posted June 17, 2020 7 minutes ago, zugzwang said: https://wonderopolis.org/wonder/why-are-they-called-flip-flops Be fair. Flip-flopping is a great strategy for always being right. Quote Link to comment Share on other sites More sharing options...
HovelinHove Posted June 18, 2020 Share Posted June 18, 2020 VI trolls out in force last night I see! I am seeing properties moving when they are well priced, and I wouldn’t be completely surprised if we see an increase in prices in a couple of the monthly figures because some people are so dumb they cannot see what is coming or have no choice but to buy. My gardener, who is getting out of his flat because his BTL owner is selling up, has been convinced by an estate agent that prices will go up, so he is offering 10% off a property he likes. There’s a reason he’s a gardener. Quote Link to comment Share on other sites More sharing options...
Locke Posted June 18, 2020 Share Posted June 18, 2020 10 hours ago, Speed1987 said: Surely they'll want the best price for any property they inherit It's free money innit? Quote Link to comment Share on other sites More sharing options...
stuckmojo Posted June 18, 2020 Share Posted June 18, 2020 13 hours ago, xxxx said: They are certainly not going to tell the truth. Will scare off the few remaining buyers. Some people are unaffected by this and can still pay stupid money. With low transaction numbers the averages are massively distorted. This is where spivs pick up the narrative that the market is on fire and prices are up. Interestingly I saw 2 houses I had been tracking for a while come back to market after being SSTC and that's in a very affluent and sought after area of the North. If that buckles, good luck with the rest. Quote Link to comment Share on other sites More sharing options...
spyguy Posted June 18, 2020 Share Posted June 18, 2020 11 hours ago, Sour Mash said: The mortgage market is THE major private sector credit pump and how most newly created 'money' (ie. bank credit) makes it into the pockets of the consumer. It's imperative to economic policy to keep it going. On top of that, should there be a HPC the bankers stand to lose a lot of money and we can't have that now. Its not really. BoE prints some money, which goes out to banks then to the mortgage. The mortgage borrowers pays the bank, the bank pays the BoE. The credit is destroyed. However, bar EAs and builders and buyers, little of that cash goes to the wealth creating economy. This is the problem with the UKs banking system - banks are too lazy to develop roper wealth creating enterprises, choosing to only lend against property, most of which is 2nd+ hand. You are *not* going to create a wealthy economy selling houses to each other. Quote Link to comment Share on other sites More sharing options...
spyguy Posted June 18, 2020 Share Posted June 18, 2020 10 hours ago, Killer Bunny said: Yes. And what comes with higher inflation? Rates... Barely half of it - higher public pension costs. Its hard to inflate your way out of a mess when a large part of that mess is index linked. Quote Link to comment Share on other sites More sharing options...
PeanutButter Posted June 18, 2020 Share Posted June 18, 2020 Lots of estate inheritances coming into the pipeline over next few months. Lots of FTB who’ve been sitting at home saving money from not commuting etc. And the whole thing has drummed it into people’s minds that life is precious. Time is finite. Live your life now. I’m not convinced 15% will stop that many. Quote Link to comment Share on other sites More sharing options...
24gray24 Posted June 18, 2020 Share Posted June 18, 2020 Yes, being locked out of the housing market while you save another 10%deposit (impossible with jobs disappearing) is going to save you from the debt spiral. There's nothing like watching your LTV going down from 50% to 40%to30% to make you realise that making money from houses is a mug's game. Enjoy being solvent in a one bedroom flat. It's better than the alternative of realising you're paying twice in interest while the value goes down the plug hole Quote Link to comment Share on other sites More sharing options...
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