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You can analyse this til the cows come home but

its so so simple

over indebted btl numpties combined with self cert "lie to buy", IR rates go up they go bust property prices collapse

There end of story

and before you get there first

Marina

Imupnorth

ignorantsteve

you can all ****** off

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You can analyse this til the cows come home but

its so so simple

over indebted btl numpties combined with self cert "lie to buy", IR rates go up they go bust property prices collapse

There end of story

and before you get there first

Marina

Imupnorth

ignorantsteve

you can all ****** off

Calm down, mate. Open the window in that office of yours...it's way too stuffy. ;)

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So it looks like you've turned too ITYS!!!!

A while back, getting bears to agree that what would cause a crash is much higher IR's. "NO" - you all screamed, it'll go without any help at all, no trigger is needed blah blah blah.

It's nice to see you all finally realising that a trigger is needed. Luckily the MPC are also aware of that trigger & wouldn't like the finger pointed at them down the track after kicking off a recession. Unlike back in the good old days when IR's were set by politicians.

So isn't it about time that you acknowledged that I TOLD YOOOOOOOUUUUUU SO!!!!

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£ down against the $ and Euro

I wonder whats goner happen next?

or for any bulls still left in the world dont worry

"its different this time"

:lol::lol::lol::lol::lol::lol::lol::lol: :lol

TTRTR

ah my old adversary

its OK everything will be fine mummy GB wont let that nasty IR bogey man hurt you .

Thats what you and Gordon think, unfortunately there are far greater forces at work

you can't beat the market the longer you try the more it will eat you up

IR are going up wether its this year or 5 years from now and the sheeple will still have a humungous debt that they cant service.

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You can analyse this til the cows come home but

its so so simple

over indebted btl numpties combined with self cert "lie to buy", IR rates go up they go bust property prices collapse

There end of story

If IRs go up then rents will go up too. Look back to the last crash if you don't believe me.

What are you going to do if the BTLs put up the rent when rates go up? Move out and buy a house?

Unless rates get slowly hiked to something like 7% over the next three years there won't be anything significant in the way of nominal falls (7% rates would start to hurt recent homebuyers).

Edited by Without_a_Paddle

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What plant are you on prices tared to fall at 4.75% in my view the rates only need to go to 5% before a big correction

And by the way how are BTLers going to put up rents when they cant find tenants?

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An interesting point.

If rents go up as easily as you suggest TTRTR then i suggest the following may happen:

Tenants refuse increase - many of which will be on a fixed term at a fixed price and will move out after this

House stands empty - landlord has to concede nobody is going to pay more for a box that he paid too much for, just because his costs have gone up

I'd imagine there would be a flow of people from properties where the landlord is trying to increase rent, to those where they've already tried and failed.

Other people, as i would be inclined to do, would just move back in with parents for a while.

If landlords didn't concede that people wouldn't pay more - which lets face it is very likely - then they would be left with void periods - and who is then going to pay the bank?

Obviously this is all suggestion, but is a possible scenario and could risk toppling the house of cards.

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So it looks like you've turned too ITYS!!!!

A while back, getting bears to agree that what would cause a crash is much higher IR's. "NO" - you all screamed, it'll go without any help at all, no trigger is needed blah blah blah.

It's nice to see you all finally realising that a trigger is needed. Luckily the MPC are also aware of that trigger & wouldn't like the finger pointed at them down the track after kicking off a recession. Unlike back in the good old days when IR's were set by politicians.

So isn't it about time that you acknowledged that I TOLD YOOOOOOOUUUUUU SO!!!!

The UK, unfortunately, follows the US like stupid younger brother. US IR going up, so won't be long now.

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What plant are you on prices tared to fall at 4.75% in my view the rates only need to go to 5% before a big correction

If rates go up slowly to 7% over three years, a 150k repayment loan will go up by £200pm.

This is spread over 3 years.

A typical joint income for a couple is £2500pm takehome.

Add 3.5% wage inflation per year on this and you get an extra £270pm in wages.

This is mostly taken up in the cost of living, but it's going to offset the pain of higher rates a bit. However, it would cause nominal falls in prices as I previously stated.

A sudden hike to 5% rates would stop the market dead IMO and you would get stagnation with some nominal falls in parts of the UK. (but an £840pm repayment mortgage would only go up £42pm)

And by the way how are BTLers going to put up rents when they cant find tenants?

You are basically implying there are too many houses if BTLs are sat with empty properties.

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You can analyse this til the cows come home but

its so so simple

over indebted btl numpties combined with self cert "lie to buy", IR rates go up they go bust property prices collapse

There end of story

and before you get there first

Marina

Imupnorth

ignorantsteve

you can all ****** off

Oh go on then, as you mentioned me by name !

I'm even going to try and find some common ground - yes you are right that if IRs go up too high, then a lot of people will get their fingers burnt. I have no problem with this, neither have any of the bulls from what I can see.

The issue is around whether IRs are going to rise to the level that will cause the damage to get a HPC going and then keep it going for a period of a few years.

I am happy to accept that a HPC would take several years to pan, I am also happy to accept that if you get a 10% reduction over a year, then this is a sign it is crashing. If it keeps going for a further year or two then we will have indeed had our price crash.

But and this is the big but, IRs are not going to rise this year, and highly unlikely into next year as well. So if the status quo remains, then the current pricing levels are likely to remain. Stagnation, yes, slight rises, yes, slight falls possible, but no HPC crash on the horizon.

So, why won't IRs rise or at least enough to cause a problem ?

The economy is finely balanced, its output growth is running near to trend and CPI is bang on target - no reason to do anything then based on current performance.

IRs are rising slowly around the world, but if we put ours up, then you start to slow the economy which we don't need. If the £ drifts down against other currencies, then this will tend to stimulate exports and make imports more expensive. So, our exporters do better and people import less. Balance of payments improve and £ tends to strengthen.

Improved exports tends to rebalance the economy away from being consumption driven - which is a good thing.

What kind of reduction in £ against a basket of currencies needs to happen in order to significantly increase inflation - my answer is quite considerable well over 10% reduction - i.e. £ needs to drop to below $1.60 and E1.3 simultaneously. It needs to happen quickly and be sustained.

Now, in a world where there is still considerable deflation in prices going on due to cheap labour and improve technology and efficiency, then this will tend to reduce the impact of the £ dropping.

So lets move onto oil, the price is remaining high (i thought it might drop a bit by now, but hey even I'm wrong), and it could well move higher. If it does, it feeds through to inflation eventually - I'm sure that without this CPI would be even lower than 2%. Oil is a global phenomenen that we cannot control and effects all countries in the world - but increasing IRs just acts as a double whammy and would bring on a recession, so you don't raise IRs to control oil prices. As it effects the world, your competitive position globally is not altered, you just have to ride this one out.

I have no doubt that we are starting to see the effect of peak oil and the end of cheap energy globally, economies and individuals will have to change their budgets over the coming years to cope. And yes, before you jump in too quickly, I accept that this will tend to depress house prices in the long term. However, the effect is long term and is not going to impact house prices in the next few years to any noticeable effect.

Should the economy weaken, as all you bears are convinced it will, then why would you increase IRs ? - well you just wouldn't would you. A weakening economy, is likely to have a reducing impact on inflation.

So to summarise, whilst I accept that there forces at work which 'may' lead to reducing house prices, I do not believe that they are of sufficient magnitude to have a profound effect. Because the economy is finely balanced (which is how it should be) then a slight nudge on the IR tiller is all that is needed to control the economy. A slight nudge, is not a sufficient trigger to cause a HPC.

For a HPC you need a big external, uncontrollable shock, and I don't see where this is coming from.

Short term, prices will stay where they are - say for the next two years is the most I could forecast. Long term, i.e. 25 years out, I see a very slow, grinding down process in relative house prices compared to say energy costs and % of take home pay. + also the effects of demographics should not be ignored.

So a HPC in the next few years - not a snowballs can in hell of one !

All in my personal opinion of course !

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An interesting point.

If rents go up as easily as you suggest TTRTR then i suggest the following may happen:

Tenants refuse increase - many of which will be on a fixed term at a fixed price and will move out after this

House stands empty - landlord has to concede nobody is going to pay more for a box that he paid too much for, just because his costs have gone up

I'd imagine there would be a flow of people from properties where the landlord is trying to increase rent, to those where they've already tried and failed.

Other people, as i would be inclined to do, would just move back in with parents for a while.

If landlords didn't concede that people wouldn't pay more - which lets face it is very likely - then they would be left with void periods - and who is then going to pay the bank?

Obviously this is all suggestion, but is a possible scenario and could risk toppling the house of cards.

Do you realise ho many people have posted this theory?

I call it the tenant shuffle. If they won't pay more here, they'll pay more there. It's all in the mind, raising rents by stealth means your incoming tenans had no idea what the outgoing tenants were paying.

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good point, and i accept you may be able to put rent up by stealth - but would you be able to put it up enough?

although i suppose most people don't do like i do and track rental prices and sale prices - i know how much all the houses in the area were up for last time and so this gives me an indication of the most someone was paying to live in that house if they paid as advertised. therefore, if i spotted a house readvertised at a massive increase, i would know.

i suppose we're going back to how stupid people are and how much they will pay for somewhere to live - in which case i accept people are idiots - therefore you win!

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Spot the deliberate mistake.

If the £ drifts down against other currencies, then this will tend to stimulate exports and make imports more expensive. So, our exporters do better and people import less. Balance of payments improve and £ tends to strengthen.

Mind boggling.

For a HPC you need a big external, uncontrollable shock, and I don't see where this is coming from.

Spotted another one

Edited by ?...!

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Over analysis again from Im up north

Look can we all get something straight

US rates uo UK will follow please please take a look at the 50 year US/UK IR graph, apart from a few blips that didnt last long we are alway 1% - 2% higher that the states.

Watch and learn

BTW £150K 7% base rate £200 a month extra im not sure about that maybe someone else can do the math

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Over analysis again from Im up north

Look can we all get something straight

US rates uo UK will follow please please take a look at the 50 year US/UK IR graph, apart from a few blips that didnt last long we are alway 1% - 2% higher that the states.

Watch and learn

BTW £150K 7% base rate £200 a month extra im not sure about that maybe someone else can do the math

I guess you are too simple to follow a decent explanation, there is no hope for you old boy. I somehow think you'll be renting all your life based on your understanding of economics.

Oh and to keep it simple ..... past performance is no guide to future performance. Don't bank on UK IRs following US IRs.

BTW, you need to follow your own advice - watch and learn - have you learnt anything about why house prices aren't crashing.

You just can't help some people.

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You can analyse this til the cows come home but

its so so simple

over indebted btl numpties combined with self cert "lie to buy", IR rates go up they go bust property prices collapse

There end of story

and before you get there first

Marina

Imupnorth

ignorantsteve

you can all ****** off

Well said. Prices are insane - and it seems people just don't want to accept that. It will take them a long time to realise - in the meantime - people will just be living miserable lives in hugely over-priced sh*tholes. Simple. It would be better to row a boat over the seas - and just camp on an island. Ha ha!

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Over analysis again from Im up north

Look can we all get something straight

US rates uo UK will follow please please take a look at the 50 year US/UK IR graph, apart from a few blips that didnt last long we are alway 1% - 2% higher that the states.

Watch and learn

BTW £150K 7% base rate £200 a month extra im not sure about that maybe someone else can do the math

I quickly did it in my head and rounded it. The actual figure is an extra £226pm on a repayment loan.

(comparing 4.5% to 7%)

Do you think rates are headed to 7% in the next 3 years?

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BTW £150K 7% base rate £200 a month extra im not sure about that maybe someone else can do the math

Sounds about right to me although I make a hike from 4.5% to 7% an increase of ~220pcm.

Also ignores things like fuel and energy bills climbing faster than a Mig 25 on missile lock. (see how many Mig 25 references I can get in today)

Edited by ?...!

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People who bought in 99/00/01 got cheap prices with low rates, some are fixed whatever, they dont have much to pay out even if rates goto 7% or 10%.

people who bought in 03/04/05 around 75% of them have fixed rate mortgages for long term periods.

I honestly think what people are expecting to happen will be very different to what does actully happen.

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So it looks like you've turned too ITYS!!!!

A while back, getting bears to agree that what would cause a crash is much higher IR's. "NO" - you all screamed, it'll go without any help at all, no trigger is needed blah blah blah.

It's nice to see you all finally realising that a trigger is needed. Luckily the MPC are also aware of that trigger & wouldn't like the finger pointed at them down the track after kicking off a recession. Unlike back in the good old days when IR's were set by politicians.

So isn't it about time that you acknowledged that I TOLD YOOOOOOOUUUUUU SO!!!!

buddy... prices dropping where I am..

Unless you read the BBC..

But if the BBC told you that a Mars bar was £0.70 and you were in the shop buying one for £0.45...

Which would you believe that you were paying..

HPC under way

People who bought in 99/00/01 got cheap prices with low rates, some are fixed whatever, they dont have much to pay out even if rates goto 7% or 10%.

people who bought in 03/04/05 around 75% of them have fixed rate mortgages for long term periods.

I honestly think what people are expecting to happen will be very different to what does actully happen.

2 years is the average fixed term taken out then..

:)

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Do you realise ho many people have posted this theory?

I call it the tenant shuffle. If they won't pay more here, they'll pay more there. It's all in the mind, raising rents by stealth means your incoming tenans had no idea what the outgoing tenants were paying.

Why not shuffle them now then? Do it now while you get the full benefit of the increased monthly rent, rather than wait until your costs go up. Why not? Explain please.

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  • 302 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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