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Realistbear

The Scotsman Warns On Dangers Off Inflating House Prices

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http://business.scotsman.com/finance.cfm?id=1144542006

A LEADING Scottish debt expert is warning of the hidden cost of surging house prices.
Recent figures show average property prices have risen by 12 per cent in Edinburgh, but Peter Dean of Carrington Dean warned debt was helping fuel the boom.
It is estimated that 40 per cent of mortgage transactions are remortgages, many of which are for debt consolidation.
Mr Dean said: "In effect, you are financing your lifestyle through the equity in your home."

Sums up what is behind the biggest asset bubble of all time: DEBT. The only miracle is that it has lasted this long.

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It is estimated that 40 per cent of mortgage transactions are remortgages, many of which are for debt consolidation.

And most of which are because there is a range of products that have a short term shelf life where they are competitive, so you change at the end of the period.

most remortgages are not to pay for a plasma, an ipod and an X5, they are because the borrower was about to go onto a SVR at somewhere in the high 6odd%, and can remortgage at under 5%......

Of course some people are doing that, but there is no evidence (in that article) to say so - pure soundbite. I have just remortgaged - took the balance down by 10% at the same time and took a 0.5% cheaper deal than I could have got today and 2.7% less than my old lender's SVR.....

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When was the last time it was cheaper to be on the best fixed rate compared with the best variable rate? In the last five years I can't believe you would have been better off on a fixed rate.

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Consolidation is also used to plug the gap between people wages and rising prices - borrowing to live in a high inflation enviroment - but they don't even realise it

Inflation is so incidious - hence why GB/BOE have allowed it to rise, keep IR low and keep them in power...

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When was the last time it was cheaper to be on the best fixed rate compared with the best variable rate? In the last five years I can't believe you would have been better off on a fixed rate.

June 1 - because I see a fix as cheaper over the next X years - which it is already pointing towards being - given that my fix is 0.4 under base........ - I took a fixed last time too - under base rate within 6 weeks and stayed there for the fixed term.

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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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