Monday, Jul 03, 2006

Is shared equity the future for the first time buyer?

TimesOnline: House share solution to rising prices

Devoid of independent thought BTL evangelist Clare Francis is again spoon fed comments from a panel of property professionals; Mark Clarke, chief executive of Advantage (Lender), Ray Boulger (Lender), Richard Donnell (HomeTrack), Fionnuala Earley (Nationwide), Alex Solomon (Rightmove) and for good measure a non-VI gets his sentence worth, Vince Cable, the Liberal Democrat shadow chancellor, said: "With 2m households living on a financial knife-edge and a further 500,000 households already with serious financial problems, any rise in interest rates could spell financial disaster." There needs to be greater access to free independent advice and a crackdown on irresponsible lending.

Posted by denzil @ 09:44 AM (635 views)
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12 Comments

1. tyrellcorporation said...

Mmmm. The government will be taking a stake in private housing which will be sold at the pinnacle of risk, ie, at the top of a massive boom cycle - I am effectively being forced to shoulder that risk through my taxes!!!

I am already ultimately paying for the national debt addiction through higher bank charges...where will it all end?!?

Bastards!!!

Monday, July 3, 2006 09:58AM Report Comment
 

2. D'oh said...

A friend of mine once summarised it thus: "The British public are a crop to be harvested every 15 years or so." I laughed at the time, but there is so much truth in that statement.

I simply cannot believe that any responsible government could think that this was a good idea...actually, to not put the scuppers on the recent lending practices of the banks is criminal negligence. Incompetence or venality?!

Monday, July 3, 2006 10:37AM Report Comment
 

3. inbreda said...

There are so many things in this article to make me angry!!!!!

Why do banks bother calculating income multiples, and constraints on BTL mortgages (e.g. rent paymnts must make up 130% of mortgage payments) if they are then going to relax the criteria as soon as someone fails to meet it?!?!?!?!?!?!?!

"Advantage uses an affordability model " ...Bully for Advantage. They are trying to sell a mortgage product based on shared ownership - i.e. to people who CANNOT AFFORD TO BUY A HOUSE!!!!! Who needs an affordability model when the clues in the title??

This kind of product could push prices higher still - and what then? Relax lending criteria further? Idiots.

Monday, July 3, 2006 11:01AM Report Comment
 

4. denzil said...

>>There are so many things in this article to make me angry!!!!!
Me too!
One thing I took from the article was what a complete and utter mess the property market is in. Affordability was being manipulated by offering higher multiples and longer terms and now it's being manipulated farther still be allowing people to buy part of a house because there's a cats chance in hell that they will ever be able to afford a whole one.



Monday, July 3, 2006 11:22AM Report Comment
 

5. Doomwatch said...

Wasn't there talk of shared ownership "products" prior to the last crash ?

Monday, July 3, 2006 12:24PM Report Comment
 

6. jason said...

"However, with the latest Bank of England figures revealing that mortgage debt has broken through the 3 trillion barrier"

Mortgage debt went through the 1 trillion barrier. It shows their incompetance if they can't get simple things like that right.

Monday, July 3, 2006 01:02PM Report Comment
 

7. bidin'matime said...

What beggars belief is that no one will countenance any possibility of prices falling the whole thing, from lenders, to government to buyers, is based on the assumption that prices can only rise! But what sickens me most is that those who do know the risks that they are taking with other peoples money will earn fat bonuses from the scheme and walk away unscathed when it all turns pear-shaped.

Monday, July 3, 2006 01:31PM Report Comment
 

8. harold said...

"The British public are a crop to be harvested every 15 years or so."

D'oh, indeed - any suggestions on where the produce is being taken, anyone?

Monday, July 3, 2006 02:07PM Report Comment
 

9. D'oh said...

Harold, a tax haven/ferrari dealership near you. lol. I saw a very interesting graph a week ago (sorry, cannot find the link) which showed the net flow of interest payments to sections of the German public. Population was divided into 10 evenly sized groups of increasing income. Only the top 20% of the population had net positive income from interest (I presume interest paid - interest earned...don't ask me for the exact definitions as I only caught the graph out of the corner of my eye). Of course the top 10% took the lions share. I must admit that I was a little shocked by just how extreme the flow of wealth from the bottom 80% to the top 10% was.

Monday, July 3, 2006 05:06PM Report Comment
 

10. harold said...

D'oh, "the flow of wealth from the bottom 80% to the top 10%" gives the impression that a nation's wealth is at least held within national circulation. Unfortunately, however, the "harvest" is being exported:

http://commons.wikimedia.org/wiki/Image:Current_account_balance_world.PNG

Monday, July 3, 2006 09:48PM Report Comment
 

11. Waitingfor The Crash said...

the answer is any bank which does these schemes - take your money out of them. I have 75K with nationwide and i am going to pull it out!

Tuesday, July 4, 2006 10:03AM Report Comment
 

12. Waitingfor The Crash said...

hey guys & gals,

just been on the phone to a letting & estate agent about a house. I told her i wanted a house with garage in good nick and was prepared to pay for that. " why do you want a garage she said most people put junk in it?"

I replied "because i want to put by bran new M3 away in it!!" (afterall that is why they build garages - but of a strange question to ask)

"why not buy then she asked that is cheaper!!"

I then told her i was waiting for the HPC before i go back in the market. "oh she said one of those waiting while prices go up!"

she then told me to keep looking. I pointed out that with rates going up I can rent on my interest quite happily for a few years! this is what the market has become!!!

trying to tempt renters back in the market!

Tuesday, July 4, 2006 02:16PM Report Comment
 

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