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dpg50000

Richer My Ar$e.....

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I know I'm preaching to the converted here, but need to let some steam off....

http://money.uk.msn.com/MyMoney/Insight/Sp...cumentid=461365

This really makes my blood boil. Notice how it's spun as home owners richer to the tune of £40,000.

I notice they make no attempt to split the figures, ie show how much of the increase is a notional increase in House prices. No-one is richer with HPI (unless they manage to sell up) - they simply have easier access to £40K more of debt, via MEW, that has to be paid back. THAT DOES NOT MAKE THEM RICHER!

I'm a homeowner. Do I feel any richer? No way! Can I get up in a morning, log onto my bank account online and see an extra £40K in there? Of course not!

This £40K (or the HPI component of it) is only notional, unless they sell.

I'm reminded of a colleague at work who bought a way overpriced flat in a poor area a few years back. Last summer he told me he was going to sell and move to a detached house. He told me how much he paid for his flat, and what it had been valued at. I wished him good luck at getting the frankly ludicrous price (didn't tell him it was ludicrous - he is a friend), and hinted he may have overpaid in the first place so might have to take a loss.

Colleagues response was on the lines of "I could sell it tomorrow and make a £15K profit". This £15K was the difference between his buying price and his ASKING price. It conveniently ignored mortgage payments made thus far, conveyancing fees etc,etc. Needless to say, in the last year he's had 2 viewings and no offers despite his confident assertion last summer. He may well be notionally £15K richer, but he can't get his hands on it without MEW, so he's actually £15K poorer than he though he was. I suspect a lot of people will find this out over the next few years.

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I know I'm preaching to the converted here, but need to let some steam off....

http://money.uk.msn.com/MyMoney/Insight/Sp...cumentid=461365

This really makes my blood boil. Notice how it's spun as home owners richer to the tune of £40,000.

I notice they make no attempt to split the figures, ie show how much of the increase is a notional increase in House prices. No-one is richer with HPI (unless they manage to sell up) - they simply have easier access to £40K more of debt, via MEW, that has to be paid back. THAT DOES NOT MAKE THEM RICHER!

I'm a homeowner. Do I feel any richer? No way! Can I get up in a morning, log onto my bank account online and see an extra £40K in there? Of course not!

This £40K (or the HPI component of it) is only notional, unless they sell.

I'm reminded of a colleague at work who bought a way overpriced flat in a poor area a few years back. Last summer he told me he was going to sell and move to a detached house. He told me how much he paid for his flat, and what it had been valued at. I wished him good luck at getting the frankly ludicrous price (didn't tell him it was ludicrous - he is a friend), and hinted he may have overpaid in the first place so might have to take a loss.

Colleagues response was on the lines of "I could sell it tomorrow and make a £15K profit". This £15K was the difference between his buying price and his ASKING price. It conveniently ignored mortgage payments made thus far, conveyancing fees etc,etc. Needless to say, in the last year he's had 2 viewings and no offers despite his confident assertion last summer. He may well be notionally £15K richer, but he can't get his hands on it without MEW, so he's actually £15K poorer than he though he was. I suspect a lot of people will find this out over the next few years.

I'm sat on 40 grand of equity thats of no poxing use to me at all! I can't use this money as a deposit to buy bigger because the mortgage would be hugely unaffordable! The only way I could make use of this forty grand is to sell up and move into a tee-pee!

Labour are a bunch of trained liars!!

http://www.blairwatch.co.uk/taxonomy/term/...c213eed9834028d

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Hi,

Richer means that you maybe can go and buy a car or a holiday home and PAY for it. It is not really the same thing as gaining access to borrowed money that then you have to worry about paying back and run the risk of losing the roof over your head if you can't. If you sell that property and make more money than you paid + costs, that has made you wealthier. If you are recieving a fine stream of income that over a period of time gives you an alternative source of liquid funds invested, like bank cash, gold, shares, etc., that has made you wealthier. An IOU from Gordon Brown doesn't count unless you can cash it in.

Edited by boom_and_bust

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It's a bit silly comparing if you are ricjer this year compared to last. Most people will be as they earn an income. That income goes somewhere, either paying off debt or into savings. The real question is am I richer than someone 1 year younger than me!

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  • 301 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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