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Why hasn't it happened. If interest rates at 4.75 back in 2005 slowed the market

why haven't interest rates at 5.5% had any effect. What happened in 2005 which caused the market to slow, just before the

fateful rate cut in August.

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It hasn't happened yet because we are in the 'buy at any cost' or 'before it goes any higher' phase. People panic as they see interest rates increasing and think they need to buy now and fix their rate (suckers) before they're priced out. It's just simple basic psychology (fear/greed). What happened in 2005 was that the housing market wobbled and the MPC got the jitters and cut, it's not so easy to do that now though.

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Why hasn't it happened. If interest rates at 4.75 back in 2005 slowed the market

why haven't interest rates at 5.5% had any effect. What happened in 2005 which caused the market to slow, just before the

fateful rate cut in August.

In my view a crash the being kept at bay by reckless lending. Yesterday I posted a link to another site where one individual had been offered £5-£15 million to build up a BTL portfolio. Still, chickens do come home to roost in the end.

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I think when we have IR's at 6% in August, people will sh*t their pants.

We'll see some (Mr) Brown action then. :lol:

Surely, many people are now expecting rate rises?

Does it really take actual rate rises for people to soil themselves?

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Why hasn't it happened. If interest rates at 4.75 back in 2005 slowed the market

why haven't interest rates at 5.5% had any effect. What happened in 2005 which caused the market to slow, just before the

fateful rate cut in August.

People have taken out fixed rate deals. Those that took fixed rate deals in August 2005 will have a shock this August when they come off it and are subject to tracker mortgages.

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I think when we have IR's at 6% in August, people will sh*t their pants.

We'll see some (Mr) Brown action then. :lol:

nice one :lol::lol:

not long before the sheeple start sh*tting it big time. Its not happened yet but it will.

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Guest d23
People have taken out fixed rate deals. Those that took fixed rate deals in August 2005 will have a shock this August when they come off it and are subject to tracker mortgages.

average fixed deal in august 2005 was 5.12%

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here's a crazy thought, maybe there is a lot of misinformation on this site which leads people to think one thing when actually the opposite is true. Huuuuge HPI is not going to go on for ever. But there is still some way to go. You'd prob understand beter if you took a more balanced view. I suggest widening your reading.

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maybe there is a lot of misinformation on this site which leads people to think one thing when actually the opposite is true

There is!

948 trolling posts from you alone in the last year <_<

Ole! :P

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here's a crazy thought, maybe there is a lot of misinformation on this site which leads people to think one thing when actually the opposite is true. Huuuuge HPI is not going to go on for ever. But there is still some way to go. You'd prob understand beter if you took a more balanced view. I suggest widening your reading.

Would you buy at today's prices given the (mis)information you have heard so far? Would you feel any more nervous that you might be buying at the peak?

Would you weigh into your decision what is happening in the credit markets, and the US and Irish house markets?

Those factors, to me, are what has materially changed the relevance of this site from its more speculative years (from what I can tell having joined only in the last year of course).

Am genuinely interest in your response, cheers.

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I guess prices would be stable by now if it weren't for BTL. First time buyers are on strike, or perhaps it's fairer to say they've been locked out- numbers halved in the past decade.

Face it- increased home ownership is a thing of the past, renting from the state is still in decline, private renting on the increase, albeit at not that bad rents these days.

Not a problem for some ,but when you're in your 30's and want to have kids etc, you have a right to be unhappy if you can't afford a decent house. So, vote for a government that will build you a nice, cheap, subsidised house for rent- like the one your parents bought for a song from Thatcher.

Maybe Broon will make this a policy and we'll be into a 1950's style competition of which government can build the most social housing.

Then again, maybe not.....

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Would you buy at today's prices given the (mis)information you have heard so far?

If I wanted to make a quick buck and was prepared to take a risk (there is always a risk involved when investing big sums of money to make big profits), then I would look to buy a property in London in poor condition, do it up and sell it. If I can turn this around in 6 months the odds are that I will make money - not only due to the fact that the market is rising rapidly, but also the state of the improved state of the property would net me a bigger sale price. In London, at least, HPI has plenty of steam left in it.

If I wanted to buy a home to live in and was putting my life on hold for a crash, I would buy now as it just isnt worth wasting all those years hoping for something that may not happen.

If I wanted to invest long term (BTL perhaps), then I would not buy now; even in London.

There are too many people in the Government and in high positions who have vested interests in ensuring that HPI continues. The PM included. Do you honestly believe that the Government will not do all it can to prevent a HPC? Just as they stopped the HPC in 2005, so they will stop it if it looks like happening again.

The only circumstance that I feel a "crash" can happen (15%+ reduction in prices) is if we go through a recession. If this happens then people simply wont have the money to sustain the rampant HPI.

Orbital is right in that if you want to get a balanced view, you cannot base things purely on what you read on this site. This site is very bearish towards property and many have lost all sense of realism.

My own belief is that we will see YoY negative figures in Sept 2008. London will continue to be positive, but the rest of the country will go negative.

Too much pessimism and not enough reaslim on this site.

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People have taken out fixed rate deals. Those that took fixed rate deals in August 2005 will have a shock this August when they come off it and are subject to tracker mortgages.

This is something to look forward to , everything else gone up in the last 2 years , average wage rises in those 2 years lagging well behind inflation ..........the SQUEEEEEEEZE is on :)

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Guest d23
This is something to look forward to , everything else gone up in the last 2 years , average wage rises in those 2 years lagging well behind inflation ..........the SQUEEEEEEEZE is on :)

fixed deals don't seem to have gone up as much as they should have done tho; average fixed deal 2 years ago was 5.12 and average in april was 5.5%

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fixed deals don't seem to have gone up as much as they should have done tho; average fixed deal 2 years ago was 5.12 and average in april was 5.5%

yes, but the fees have gone way up

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