Thursday, April 12, 2007
You couldn’t make it up
First-time buyers are struggling with confidence rather than affordability
Erm...we're not sure where to begin with these comments from HML, apparently affordability is not an issue for first time buyers, they just need confidence...I think we'll leave it there... Mark Smith, managing director of mortgage processing company Homeloan Management: "The CML points out that record numbers of first-time buyers are taking fixed rate loans, but what is more worrying is that there are fewer first-time buyers than there have been for almost two years.
Posted by converted lurker @ 01:26 PM (482 views)
7 thoughts on “You couldn’t make it up”
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Adam says:
“interest payments still only represent on average 18% of their income”
Where do they keep getting this 18% from ??? Can we locate the person that worked this out and hang him out to dry by the balls ?
It is about as 18 as my thingy, most people are puttin 50-60% of their salary into their mortgage payments.
royston says:
Oh, come on, BofE, get those interest rates down! Don’t you know that your high rates are scaring off first-time buyers. Without lower rates, the non-stop house price increase party could end – it will be your fault if it does. Now, stop mucking about and lower the rates!
In fact, if you drop interest rates to 0% and allow banks to issue mortgages with infinite payment periods, we can all become infinitely rich – none of us need ever work again – we can just tap into MEW. Can’t fail! How’s that for a vote winning idea?
dugmug says:
“interest payments still only represent on average 18% of their income, hardly changed from last month.”
But this figure was only 15% in 2004 and only 12.9% in 1999. INTEREST (forget actually repaying the principle, or your council tax/water rates/food bills for that matter) is 18% of income! That would shake my confidence too!! These mortgage guys really are grasping now aren’t they 🙂
BTW I’ve argued in the past that there’s a real bias at FirstRung to try to seem pro-FTB, but not to ever slag-off its paymaster (i.e. lending mortgages) even when things were being said that didn’t stand up to scrutiny as being in an FTB’s best interests! However, I admit, this is the second article in two days to buck that trend; the demon of distrust inside me now wants to know why, however! 😉
Rep013 says:
Where do they get these figures – 18% of their income?
The average property is now £200K on an IO mortgage this is £750 per month (after a 10% deposit). For this to be 18% of anyones wages they would need to be earning £50K pa (this is after TAX and NI) so actual income would need to be more like £85K.
Confidence …… MY BIG FAT HAIRY ASS!!!!!
C'mon Correction says:
I agree Rep013. And i think you’re estimating an IO mortgage of £200k a bit low at only £750 a month. More like £850-£900 on the best rates, increasing to £1000 a month after a few years (or paying re-mortgage fees, costs more either way).
The fact it is buying a house is just too expensive and too risky at the minute, no amount of talk from estate agents and “mortage experts” is going to change that !
converted lurker says:
Cleverly this is 18% of your income on the interest of the loan, not the total payment per month =;¬) In relation to Dug Mug perhaps it’s just telling as you see it. The company started in 2002 enjoying the simple pleasures of offering straight forward mortgage solutions for FTBs, perhaps we’re all a little pissed off with the current situation for so many diverse reasons =:¬(
English Oak says:
I’m sick of this Crap, from my perspective as a First time buyer the whole Economy is some kind of whacky 60’s to 30 year old Generations Test Bed, compileing into a load of Spin from the 60’s Influence that will finally meet its convienient Goverment Routes into the Euro Economy.