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What's really driving house prices? COVID in Australia may prove a point!


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4 hours ago, dugsbody said:

Only small number of people will be on SVR paying 5% today and back then. Most are on fixed or on base tracker + some small percent. And most importantly, sale prices are not conducted using SVR. I'd go as far as saying every new buyer will be taking a fixed rate.

7% and 2% is pretty accurate.

 

Approximately one third of mortgagors were on an SVR in 2010. Many of these so-called 'mortgage prisoners' are still paying interest at 4-5%.

Not that the Tory boys care!

 

https://www.moneysavingexpert.com/news/2021/04/commons-vote-mortgage-prisoners-/

Conservative MPs have struck down a proposed amendment to the Financial Services Bill, which would have seen interest rates capped for certain mortgage prisoners.

The amendment to the Financial Services Bill, which had been suggested by the All-Party Parliamentary Group on Mortgage Prisoners (APPG), would have brought in a cap on the standard variable rate (SVR) of interest for mortgage prisoners in 'closed books' - ie, those borrowing from a firm which no longer lends to new customers. The proposed cap was no more than 2% above the Bank of England base rate (currently 0.1%)

 

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2 hours ago, scottbeard said:

I'm not sure what the point you're making here is?

My point is simply: if you build more houses then - all other things being equal - the cost of renting will fall.

Obviously a whole variety of different factors will have contributed to the position in that area to which your anecdote relates.  I'm not trying to pretend that building houses is the only influence on the market, but it seems odd that people appear to be disputing one of the most fundamental principles of pricing any commodity, namely that increasing supply reduces price.

Who is disputing that? Perhaps you can quote some lines from posts, otherwise it seems you are arguing a strawman.

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2 hours ago, zugzwang said:

Approximately one third of mortgagors were on an SVR in 2010. Many of these so-called 'mortgage prisoners' are still paying interest at 4-5%.

I think your figures are being morphed and cherry-picked to suit your argument so I'll just let you get on with it.

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