Nationwide New Rates - Just out

[scottbeard]

9 minutes ago, TerryBoi said:

Rates will be a LOT lower between now and 10 years dude.

If not then we're talking the end of the world as we know it.

That's a good thing, not the problem you make it sound like.

We need to leave this world of low interest rates and insane house prices behind, and move back to the normal situation of 4% IRs, 6% mortgage rates, affordable house prices.

This is great news for the economy, even though it's a disaster for those with a big mortgage 😮

[henry the king]

3 minutes ago, TerryBoi said:

True, no easy paths here.

But at least as renters they have choices.

Downgrade. Move in with parents etc.

The mortgage is gonna be like a rope around their neck at best.

At worst a job loss during a down turn, and its game over.

They are so so screwed.

ALREADY 5-6% rates. ALREADY.

Will be higher soon. And loads of people come of fixed rates in June/July as they all bought summer 2021 due to the stamp duty holiday innit. Houses can only ever go up innit.

Someone who bought at 1.5% rates then on 300k mortgages. They paid £1200/month. At 5.5% (and it will go higher so this is VERY generous). They will pay £1800/month.

Even now they have to find £600/month more...O yeh...and petrol is up. Food is up. Bills are up. 

Crashy

Crashy

[Huggy]

Bear food is incredibly moreish don't you think 🤤

Such a shame it'll take months to feed through to the headline numbers. NW might even post 0.00% growth for a couple of months (coupled with a monthly prior month adj of -5% of course), it'll be that bad.

[henry the king]

3 minutes ago, Nomadd said:

Three excellent candidates for an HPC tee shirt.

😄😄😄

The markets are doing Bailey's job for him.

They had enough waiting and just said "screw it, we will do it then". And Bailey is just sat there like a rabbit in the headlights

Edited September 27, 2022 by henry the king

[henry the king]

2 minutes ago, Huggy said:

Bear food is incredibly moreish don't you think 🤤

Such a shame it'll take months to feed through to the headline numbers. NW might even post 0.00% growth for a couple of months (coupled with a monthly prior month adj of -5% of course), it'll be that bad.

Prices might fall in the next data anyway. Mortgages have gone up even before this. I am fairly confident in that but I won't say it for sure because then I get people saying "You said it would go down in October and it didn't till November!". 

Sentiment and financial conditions flipped early August. Sentiment was decimated in late september. 

Edited September 27, 2022 by henry the king

[winkie]

2 minutes ago, Ah-so said:

That tends to be the way. And then they moan about it for years afterwards. 

Yes......10 years at those rates is a long time to regret doing it........got to get inflation down to get rates down......or more money printing that is what has created inflation, lots of cheap money = HIP....

 

[debtslave]

FTB's are screwed. Guess this means more people trying to rent as rents now cheaper than owning atm.

 

 

[TerryBoi]

4 minutes ago, scottbeard said:

That's a good thing, not the problem you make it sound like.

We need to leave this world of low interest rates and insane house prices behind, and move back to the normal situation of 4% IRs, 6% mortgage rates, affordable house prices.

This is great news for the economy, even though it's a disaster for those with a big mortgage 😮

Yes, I can see the positives. A reasonable price for capital will reduce misallocation and in the long-run and improve inflation as investments move into more productive endeavors. We can tamp down the speculative madness and reduce inequality.

BUT the negatives are significant too. An overall increase in unemployment as marginally productive workers are dropped and cut-backs in government spending as GDP falls. What's gonna hurt people more to the average blue collar guy in the street? Inflation or a job loss, speculative home prices or benefit cuts.

Its not clear to me are the trade-offs worth it.

[Maghull Mike]

Market to BOE

Screw you guys!

 

[dances with sheeple]

6 minutes ago, scottbeard said:

That's a good thing, not the problem you make it sound like.

We need to leave this world of low interest rates and insane house prices behind, and move back to the normal situation of 4% IRs, 6% mortgage rates, affordable house prices.

This is great news for the economy, even though it's a disaster for those with a big mortgage 😮

Yes, but that isn`t going to happen smoothly now is it, there are too many negative factors going on all at once?

Th fallout from this will be massive for the debt laden UK sheeple.

[TheResponsibleHouseBuyer]

We still need 1 piece to fall in this massive mess to complete the chain.

Mega job losses.

If people keep their jobs, they can adapt. Unemployment going up is like a cancer spreading through the heart of the UK economy.

It would also amplify the mini-budget gamble / failures on low taxes. No one working, no businesses = no tax 

[dances with sheeple]

10 minutes ago, henry the king said:

They are so so screwed.

ALREADY 5-6% rates. ALREADY.

Will be higher soon. And loads of people come of fixed rates in June/July as they all bought summer 2021 due to the stamp duty holiday innit. Houses can only ever go up innit.

Someone who bought at 1.5% rates then on 300k mortgages. They paid £1200/month. At 5.5% (and it will go higher so this is VERY generous). They will pay £1800/month.

Even now they have to find £600/month more...O yeh...and petrol is up. Food is up. Bills are up. 

Crashy

Crashy

Average couple who both work and keep their jobs can find £600 a month, they might have to get cheaper phone deals, cancel the gym, and God Forbid! the bling car monthly payments, but most will hang on In their overpriced debt boxes I think, sad existence though having all that debt round your neck for basic shelter?

[dances with sheeple]

2 minutes ago, TheResponsibleHouseBuyer said:

We still need 1 piece to fall in this massive mess to complete the chain.

Mega job losses.

If people keep their jobs, they can adapt. Unemployment going up is like a cancer spreading through the heart of the UK economy.

It would also amplify the mini-budget gamble / failures on low taxes. No one working, no businesses = no tax 

LOL, that would be funny, can`t see Truss and Co. being around long TBH.

[henry the king]

3 minutes ago, dances with sheeple said:

Average couple who both work and keep their jobs can find £600 a month, they might have to get cheaper phone deals, cancel the gym, and God Forbid! the bling car monthly payments, but most will hang on In their overpriced debt boxes I think, sad existence though having all that debt round your neck for basic shelter?

1, There will be a huge recession anyway, and a huge recession in particular in the UK if everyone does this and cuts back

2, This is based on a BEST CASE scenario where mortgage rates literally don't go up between now and July. What are the chances of that? Basically zero. 

If mortgage rates get to 7.5-8% (probable) then then need £2200-2300. So an extra £1k/month. 

[TerryBoi]

3 minutes ago, dances with sheeple said:

Average couple who both work and keep their jobs can find £600 a month, they might have to get cheaper phone deals, cancel the gym, and God Forbid! the bling car monthly payments, but most will hang on In their overpriced debt boxes I think, sad existence though having all that debt round your neck for basic shelter?

Another option is a few hand-jobs every weekend behind Kings Cross.

I remember back in 1994 the going rate was 15 GBP for a "cheeky HJ" behind the station.

[Quicken]

19 minutes ago, Nomadd said:

Three excellent candidates for an HPC tee shirt.

I prefer "Hope is not a strategy", Nomura.

[TheResponsibleHouseBuyer]

1 minute ago, dances with sheeple said:

LOL, that would be funny, can`t see Truss and Co. being around long TBH.

That would be a bloody disaster. 

Can you imagine no money for the NHS, Police [insert emergency services], Binmen etc.

Dont know how much lower we can go, I think worst case is we become Turkey. Even worse Venezuela?

[FivePoundLatte]

That's an insane jump. Our 5 year <60% LTV is now substantially higher (was 1.22% a year ago, it's now 5.44% if I'm reading that right?)

[NoHPCinTheUK]

Just now, henry the king said:

1, There will be a huge recession anyway, and a huge recession in particular in the UK if everyone does this and cuts back

2, This is based on a BEST CASE scenario where mortgage rates literally don't go up between now and July. What are the chances of that? Basically zero. 

If mortgage rates get to 7.5-8% (probable) then then need £2200-2300. So an extra £1k/month. 

Inflation will stay above 10% for a while. Mortgage rates will be at 12% by next year. The FED want inflation to go back to 2% and it can only happen with IRs higher than inflation. 

[Nomadd]

4 minutes ago, henry the king said:

If mortgage rates get to 7.5-8% (probable) then then need £2200-2300. So an extra £1k/month. 

And to put that into perspective, a person on £50k would then need to earn £67k just to stand still. Add in food, energy, travel and everything else going up in price, then that's more like £80k - again, just to stand still. Shocking, isn't it.

I wonder if those rejoicing on here about their 5% pay rises a few months back feel quite so smug now..? 

[Glental]

It doesn’t look too bad if you have decent LTV and can fix for 5-10 years

edit: it’s quite a jump actually. They haven’t update their online calculator 

Edited September 27, 2022 by Glental

[Extreme_biker0]

4 minutes ago, Nomadd said:

And to put that into perspective, a person on £50k would then need to earn £67k just to stand still. Add in food, energy, travel and everything else going up in price, then that's more like £80k - again, just to stand still

You would need to be on 72k to take home £1,000/month more than someone on 50k.

That's assuming no children.  If you have 2 kids then child benefit gets taken back off you in that bracket so add another 2k so 74k.

Just to stand still.

[GenZ]

Isn't 5% more normal, if you look at the historical data.  you can see 5% is the low to mid point.   People most of budgeted for an Increase in rates.   0.5% was an emergency  rate. 

I'm on a term, always seemed crazy people not going  on long term fix when rates were so low.  Some people just don't listen 

[Nomadd]

16 minutes ago, Extreme_biker0 said:

If you have 2 kids then child benefit gets taken back off you in that bracket so add another 2k so 74k.

Just to stand still.

So basically you need a near 50% pay rise to stand still.

And that still doesn't take into account the additional extra costs for a family at a time of rising food, energy, travel, etc. bills.

[henry the king]

38 minutes ago, Nomadd said:

And to put that into perspective, a person on £50k would then need to earn £67k just to stand still. Add in food, energy, travel and everything else going up in price, then that's more like £80k - again, just to stand still. Shocking, isn't it.

I wonder if those rejoicing on here about their 5% pay rises a few months back feel quite so smug now..? 

That is presuming they got a 1.5% mortgage. Some got cheaper. In September 2021 they were offering 0.87% mortgages