Jump to content
House Price Crash Forum
Sign in to follow this  
hedi

Credit Crunch

Recommended Posts

the housing market is not complicated. very few people can afford to buy without a loan, therefore the price of a property is the amount a lender will lend against it. amongst all the hullabaloo of the .25 pct ir rise, is the bad debt situation. the banks have been posting their profits, which are huge, but they are posting their worldwide profits. if you look closely, a larger than acceptable share of bad debts is comming from the uk. as a result that banks will rein in their lending, causing a crunch, without excessive ir rises.

the banks do not like writing off peoples debts and if more and more people chose the new lab option of absolving themselves of debt, the banks will simply stop lending money so vigourously. the result will be a decline in consumer spending, and as our economy runs on spending who knows what that will do.

ps. i have always found it a bit odd that consumer spending is a large part of gdp, im not quite sure what production is going on, but in this consumer country of ours, if the spending slows down we are in for a rocky ride.

Share this post


Link to post
Share on other sites

the housing market is not complicated. very few people can afford to buy without a loan, therefore the price of a property is the amount a lender will lend against it. amongst all the hullabaloo of the .25 pct ir rise, is the bad debt situation. the banks have been posting their profits, which are huge, but they are posting their worldwide profits. if you look closely, a larger than acceptable share of bad debts is comming from the uk. as a result that banks will rein in their lending, causing a crunch, without excessive ir rises.

the banks do not like writing off peoples debts and if more and more people chose the new lab option of absolving themselves of debt, the banks will simply stop lending money so vigourously. the result will be a decline in consumer spending, and as our economy runs on spending who knows what that will do.

ps. i have always found it a bit odd that consumer spending is a large part of gdp, im not quite sure what production is going on, but in this consumer country of ours, if the spending slows down we are in for a rocky ride.

In the future, will it be only those with A1 credit ratings that get the best deals? The rest will pay through the pocket both in interest rates and borrowing power. Who knows? :unsure:

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.