Lenelby Posted August 12, 2023 Share Posted August 12, 2023 Scheme encouraged people to buy property now beyond their means, say critics https://www.telegraph.co.uk/business/2023/08/12/help-buy-scheme-first-time-buyers-downsize/ “Since buying, they have added two cars, two kids, loans and credit cards to their lives, and on top of this the Help to Buy interest payments are kicking in.” Worth a read. It’s a long article. I don’t know if someone else can paste a link that’s not paywalled for those without a subscription. Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 12, 2023 Share Posted August 12, 2023 https://12ft.io/proxy?q=https%3A%2F%2Fwww.telegraph.co.uk%2Fbusiness%2F2023%2F08%2F12%2Fhelp-buy-scheme-first-time-buyers-downsize%2F Quote Link to comment Share on other sites More sharing options...
70PC Posted August 12, 2023 Share Posted August 12, 2023 19 minutes ago, Lenelby said: Scheme encouraged people to buy property now beyond their means, say critics https://www.telegraph.co.uk/business/2023/08/12/help-buy-scheme-first-time-buyers-downsize/ “Since buying, they have added two cars, two kids, loans and credit cards to their lives, and on top of this the Help to Buy interest payments are kicking in.” Worth a read. It’s a long article. I don’t know if someone else can paste a link that’s not paywalled for those without a subscription. From the article: "Lenders are offering an enormous package of support, which includes letting homeowners make a temporary switch to interest-only payments or extending their mortgage terms....... The forbearance measures will perhaps stop an immediate crisis, but one way or another households have to be able to afford their mortgages and to repay them." Support, fobearance? No. Lenders make more money from these measures. Quote Link to comment Share on other sites More sharing options...
sta100 Posted August 12, 2023 Share Posted August 12, 2023 (edited) The htb loan has a much lower rate than a mortgage so in theory they should be better placed. This is the problem with lending to people who couldn't afford to buy in the first place, they simply loaded up on more debt because the message given was don't worry about borrowing even if you can't afford it cos the government will step in. There's no way around people not being able to afford property other than a decrease in prices. Edited August 12, 2023 by sta100 Quote Link to comment Share on other sites More sharing options...
Roman Roady Posted August 12, 2023 Share Posted August 12, 2023 Just think, all that money being spent on the boat people that could go to help these poor young HTB victims...must be galling. Quote Link to comment Share on other sites More sharing options...
andrewwk Posted August 12, 2023 Share Posted August 12, 2023 3 hours ago, Lenelby said: Scheme encouraged people to buy property now beyond their means, say critics https://www.telegraph.co.uk/business/2023/08/12/help-buy-scheme-first-time-buyers-downsize/ “Since buying, they have added two cars, two kids, loans and credit cards to their lives, and on top of this the Help to Buy interest payments are kicking in.” Worth a read. It’s a long article. I don’t know if someone else can paste a link that’s not paywalled for those without a subscription. I thought that was the whole point of it. Quote Link to comment Share on other sites More sharing options...
Dyson Fury Posted August 12, 2023 Share Posted August 12, 2023 Quote Landlords are struggling too, says Mulheirn. Buy-to-let mortgages are excluded from the mortgage charter, under which struggling borrowers are entitled to support from banks, and the majority of landlords are on interest-only deals, which will see much bigger proportionate increases in costs. 😁 Quote Link to comment Share on other sites More sharing options...
Dyson Fury Posted August 12, 2023 Share Posted August 12, 2023 Quote Under the scheme, which closed in March, buyers could purchase a new build home with a 5pc deposit and a 20pc Government-backed equity loan, or 40pc for those buying in London. This loan was interest-free for the first five years. After that, interest is charged at 1.75pc – a rate which then increases by a measure linked to inflation. I can't believe that was the intention of the legislation. But 1.75 pc is the specified rate. It probably seemed quite high when the scheme was drawn up. But now this is far lower than normal rates and there is a positive disincentive to paying it off. And taxpayers continue to fund cheap loans. Surely it would have been more sensible to specify "Base Rate plus 1%" or something similar? Quote Link to comment Share on other sites More sharing options...
bushblairandbrown Posted August 12, 2023 Share Posted August 12, 2023 5 hours ago, sta100 said: There's no way around people not being able to afford property other than a decrease in prices. It’s just so obvious it’s depressing Quote Link to comment Share on other sites More sharing options...
cdd Posted August 12, 2023 Share Posted August 12, 2023 "I'm from the government, and I'm here to help". Quote Link to comment Share on other sites More sharing options...
Lenelby Posted August 12, 2023 Author Share Posted August 12, 2023 The best comment I saw on this article. HtB was cynically introduced to help the large construction companies, not the hapless purchasers. These companies donate large sums to certain political parties whereas young struggling couples do not (other than through ruinous levels of taxation, of course). The governing classes couldn't care less; they have their funds and the companies have their profits. Where will they look next to extract even more from the pockets of us all? That's the question. And almost all of the replies called for net zero, heat pumps, CBDCs etc. You just know it. Quote Link to comment Share on other sites More sharing options...
Insane Posted August 12, 2023 Share Posted August 12, 2023 5 hours ago, Roman Roady said: Just think, all that money being spent on the boat people that could go to help these poor young HTB victims...must be galling. It is galling that tax payers money is being spent on either. Quote Link to comment Share on other sites More sharing options...
no_dependent4663 Posted August 13, 2023 Share Posted August 13, 2023 16 hours ago, Lenelby said: they have added two cars, two kids, loans and credit cards to their lives, HTB isn't the problem. Quote Link to comment Share on other sites More sharing options...
Dames Posted August 13, 2023 Share Posted August 13, 2023 18 hours ago, Lenelby said: “Since buying, they have added two cars, two kids, loans and credit cards to their lives, and on top of this the Help to Buy interest payments are kicking in.” A workmate I know , couldn't make the balloon payment recently. Hand the car back ? No , rolled it over to a new >£30k car . Mortgage soon to be increasing by around 35% too. 🤷 D Quote Link to comment Share on other sites More sharing options...
regprentice Posted August 13, 2023 Share Posted August 13, 2023 35 minutes ago, Dames said: A workmate I know , couldn't make the balloon payment recently. Hand the car back ? No , rolled it over to a new >£30k car . Mortgage soon to be increasing by around 35% too. 🤷 D lots of people find themselves in this position. The problem they have is that car prices have run well in excess of inflation and now people are borrowing to buy something they dont realise they can no longer afford. The car companies are a lot like the house builders ... they've jacked up prices and used finance to mask the true "up front" cost of their product yet they're facing a growing tide of default driven by their unrealistic "guaranteed future values" on lease deals that will bust some of them. Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 13, 2023 Share Posted August 13, 2023 (edited) 1 hour ago, regprentice said: lots of people find themselves in this position. The problem they have is that car prices have run well in excess of inflation and now people are borrowing to buy something they dont realise they can no longer afford. The car companies are a lot like the house builders ... they've jacked up prices and used finance to mask the true "up front" cost of their product yet they're facing a growing tide of default driven by their unrealistic "guaranteed future values" on lease deals that will bust some of them. Haven't we had swell-flation in cars? The latest Ford Ka is bigger than early Fiestas. A modern Focus estate is the same size as a Volvo estate from 30 years ago. The latest suburban SUVs can seat as many as a small minibus could in decades past. They're used as runabouts. And of course all that extra steel and engineering costs money. Edited August 13, 2023 by Si1 Quote Link to comment Share on other sites More sharing options...
nero120 Posted August 13, 2023 Share Posted August 13, 2023 2 hours ago, Dames said: A workmate I know , couldn't make the balloon payment recently. Hand the car back ? No , rolled it over to a new >£30k car . Mortgage soon to be increasing by around 35% too. 🤷 D That time is coming to an end quick sharp. Company insolvencies are on the rise and eventually it will hit the car companies. Gov can't back bail outs whilst inflation is prevalent. Watch this space. Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 13, 2023 Share Posted August 13, 2023 2 hours ago, Dames said: A workmate I know , couldn't make the balloon payment recently. Hand the car back ? No , rolled it over to a new >£30k car . Mortgage soon to be increasing by around 35% too. 🤷 D F#ck Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 13, 2023 Share Posted August 13, 2023 10 minutes ago, nero120 said: That time is coming to an end quick sharp. Company insolvencies are on the rise and eventually it will hit the car companies. Gov can't back bail outs whilst inflation is prevalent. Watch this space. Yeah we argue like cats and dogs here but we probably have more in common with each other than these tedious debt junkies f#cktards Quote Link to comment Share on other sites More sharing options...
24gray24 Posted August 13, 2023 Share Posted August 13, 2023 17 hours ago, Dyson Fury said: I can't believe that was the intention of the legislation. But 1.75 pc is the specified rate. It probably seemed quite high when the scheme was drawn up. But now this is far lower than normal rates and there is a positive disincentive to paying it off. And taxpayers continue to fund cheap loans. Surely it would have been more sensible to specify "Base Rate plus 1%" or something similar? How does 1.75% work if it's increasing in line with 10% inflation? Does that mean it doubles every 7 years? Quote Link to comment Share on other sites More sharing options...
nero120 Posted August 13, 2023 Share Posted August 13, 2023 10 minutes ago, Si1 said: Yeah we argue like cats and dogs here but we probably have more in common with each other than these tedious debt junkies f#cktards Absolutely brother! Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 13, 2023 Share Posted August 13, 2023 (edited) 41 minutes ago, 24gray24 said: How does 1.75% work if it's increasing in line with 10% inflation? Does that mean it doubles every 7 years? 1.75% 1.92% 2.11% 2.32% (Up 10% each time) So yeah it does Edited August 13, 2023 by Si1 Quote Link to comment Share on other sites More sharing options...
Blobsy Posted August 13, 2023 Share Posted August 13, 2023 HTB = a comi-tragedy. Quote Link to comment Share on other sites More sharing options...
regprentice Posted August 13, 2023 Share Posted August 13, 2023 2 hours ago, Si1 said: Haven't we had swell-flation in cars? The latest Ford Ka is bigger than early Fiestas. A modern Focus estate is the same size as a Volvo estate from 30 years ago. The latest suburban SUVs can seat as many as a small minibus could in decades past. They're used as runabouts. And of course all that extra steel and engineering costs money. On the one hand thats true ..and that really annoys me because ive a parking space that is 4.2 meters deep and car lengths for family cars are getting bigger than that size. But on the other hand some models haven't changed dimensions in 7-9 years, only getting a cosmetic facelift, and their price still goes up. Quote Link to comment Share on other sites More sharing options...
Si1 Posted August 13, 2023 Share Posted August 13, 2023 1 hour ago, Blobsy said: HTB = a comi-tragedy. Absolutely . In every way. So many victims. Quote Link to comment Share on other sites More sharing options...
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