Tuesday, September 11, 2007

The irrelevance of FTB and how house prices are still booming are shown here.

First-time buyers squeezed again

First-time buyers are suffering an increasing squeeze on their incomes as they get on the property ladder, says the Council of Mortgage Lenders (CML). Its latest figures show that average first-timers are now borrowing 3.39 times their incomes, a new record.

Posted by david20040_0 @ 06:25 PM (1687 views)
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30 thoughts on “The irrelevance of FTB and how house prices are still booming are shown here.

  • 3.39??? what rubbish, more like 6 times…

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  • I can think of one other irrelevance around here. If you think first time buyers are meaningless in a housing market you are just being silly.

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  • And house prices still continue to rise.

    FTB are becoming irrelevant.

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  • More than anything now, I want a HPC just to shut up one of the more idiotic posters on this site!

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  • Unfortunately as house prices are now starting to accelerate again even with all the interest rate rises it looks like your hopes will not be fulfilled.

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  • Rome is burning. You are fiddling.

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  • No not really.

    House prices are at their highest ratio ever. This hasn’t even triggered a hint of a crash and they have started to boom again.

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  • Ok, that’s it. I’m a very rare poster on here and he’s even starting to wind me up now. Can someone please point out to Mr 20040_0 that the above statement came from the COUNCIL OF MORTGAGE LENDERS!!!!……….. and then explain the meaning of ‘vested interest’ to him.

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  • Won’t (can’t) last forever. The bigger they come…

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  • Dave if you care to read the articles before you post you would have read the following:-

    “The long-anticipated slowdown in the housing and mortgage markets may now be beginning to materialise,”

    Alas you are just a wind-up merchant.

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  • I’ve just read the first 5 post here, and I must say I haven’t laughed so much in ages! The dialogue is just so funny! David, enuii is right, you are a wind-up merchant, but you have the ability to bring out the best as well as the worst in the other posters. Wiltshire, you have such a dry sense of humour. Thanks for cheering up my evening!

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  • SU keep laughing cos it might help you to overcome the fact that house prices are still rocketing.

    You can laugh at me all you want but so far I have been right.

    I want a crash but I am not placing my bets on misguided beliefs that we are heading for any sort of crash.

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  • Are we sure David is not Tony Blair himself?

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  • Och, David, don’t go all serious on me. Its good to laugh sometimes. You should try it. It helps keep you sane in an insane world.

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  • The world has got a little too insane for me.

    House prices going up at 1k to 2k a month makes me feel sick.

    GB as our PM doesn’t fill me with joy either and the BoE as useless as ever.

    I bet CPI drops to 1% with this lot at XMAS. Anyone see that the price of bread is to go up 17% yet I bet the CPI will still drop.

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  • dohousescrashinthewoods says:

    With smoke and panic pouring out of the financial centres, it would seem the liquidity (cheap lending) bubble is bursting. No matter what the state-controlled media is putting out, look at what is realy going on. The Government needs the BBC to reinforce its “stability” message the most as the waters close over the bridge of the Titanic.

    This ship was struck by an iceberg months and months ago. Just because the BBC big band is still playing, doesn’t mean we’re not going down by the head. And Gordon knows it.

    The financial world’s money is evaporating by the hour and the chances are they are about to turn on their customers. The housing bubble is a mere twinkle in the eye of the liquidity bubble – a fattened seagul in the headlights of a flaming 747 heading for the deck. I would not be surprised to see a last squawk of HPI before prices and BTLs are obliterated under a flurry of desperate bankers, who will be in the lifeboats and rowing like their little wallets depend on it before the sheeple can even reach the standby button on their widescreen pacifiers.

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  • hello? – reality check here

    I’ve tracked rental and for sale prices for the past year in the area where I live (the ‘best city in the UK’ – thank you so much channel 4 homes)

    They are FLAT, FLAT, FLAT – no lender stats, no EAs, no pseudo surveys, just real house prices.

    Asking prices are FALLING, especially on new builds, conversions etc. These are in the local printed press, not in some kids (sorry David if you’re over 16, just I can’t tell from your posts) dreams or a VI website.

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  • How safe are the banks then?

    Royal Bank of Scotland et al I take it are relatively safe?

    Why are Internet Banks such as Icesave and ICICI India offering such high fixed term rates of 6.75% at the moment? Is this a sign of panic?

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  • David, are you sure you want to end up in London? At least think about the possibility of living elsewhere. A slower pace of life might be good for you – less stress. I was told houses were going up £1K every month too (in Scotland) but I can assure you that is not happening any more (at least up here.) If you don’t have a sense of humour (some people don’t and others like me have too much) then at least find some way of switching off and enjoying life. There are so many worse things that are happening. More soldiers have been killed recently (can’t remember if Iraq or Afghanistan) Their families will be experiencing such stress and grief that puts our problems over housing into the shadows.

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  • Seems like a sensible move to me David. ICICI et al were offering savings rates that were (note past tense) very high. How was that profitable? It probably wasn’t at the time, but a few short months later and all of a sudden the bank lending LIBOR rate has rocketed. All of a sudden their cash reserves seem to have been a very prudent move. While everyone else is scrabbling around for pennies, ICESAVE are sitting on a mound of cash.

    And laughing.

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  • What I mean is who is more likely to go tits up?

    Big UK banks like RBS, HSBC etc or little Internet savers like ICESAVE? The fact that the money has to be fixed to get massive rates seems to be a little worrying.

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  • The average ftb must be earning a packet only needing to borrow 3.39 income

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  • Van Hoogstraten says:

    Just read this in the Grauniad

    Further evidence of a slowing housing market has emerged as the latest figures from the Council of Mortgage Lenders (CML) reveal that the number of people taking out home loans fell in July.

    The number of mortgages taken out for house purchases dropped by 8 per cent in July, from 102,000 to 94,000. The summer months are always a quiet time for the housing market, but analysts believe July’s fall in lending is another sign that the recent interest rate rises are beginning to bite,

    Michael Coogan at the CML said: “A slight fall in lending between June and July has emerged for the third year in a row, so we cannot read too much into a single month’s figures. But the long-anticipated slowdown in the housing and mortgage markets may now be beginning to materialise.

    “Both market conditions and sentiment are coming off the boil, and affordability is ever more stretched.”
    etc etc

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  • planning4acrash says:

    Daft Boy, you are wrong, the average FTB is being ripped off. What you are seeing are peep’s earning 50 grand or more thinking that they caught the last train to Lhassa buying a studio flat in Barnes/Putney for 300k. They will soon wish they’d rented for a few yrs and bought a 3bed house after the crash. Its sad, because these FTB’rs prob spent much energy getting to where they got today just for BTL’s to inflate the market and send them into negative equity. Glad I’m not one of the mugs.

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  • planning4acrash says:

    Daft Boy, you are wrong, the average FTB is being ripped off. What you are seeing are peep’s earning 50 grand or more thinking that they caught the last train to Lhassa buying a studio flat in Barnes/Putney for 300k. They will soon wish they’d rented for a few yrs and bought a 3bed house after the crash. Its sad, because these FTB’rs prob spent much energy getting to where they got today just for BTL’s to inflate the market and send them into negative equity. Glad I’m not one of the mugs.

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  • Daft boy. I guess you’re living in England – possibly the south. In some areas of Scotland it’s possible to buy a 2 bedrm flat for offers over £45K, Even assuming the sellers want £50K for it the figures are not humungous. Say £5K for a deposit and the buyers are earning £15K a year. They would only need to borrow 3 times their annual income.

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  • David20040_0 is accurate in one respect: House prices are not falling. We might, collectively, think house prices are likely to fall in the medium term, but that doesn’t make a house price decline a certainty.

    For all the fervour of HPC-ers predictions, they merely suggest one of a number of possibilities. What would happen to the UK housing market if Base Interest Rates did not rise above 5.75% for the rest of this year and were cut in the new year.

    High house prices mean high entrance costs to those entering the housing market yet falling interest rates would be of great benefit to home-owners / BTL-ers and such an outcome would sustain current high house prices. Could be exactly what Gordon Broone wants in the run up to an election.

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  • Have you looked at house prices in Yorkshire? There are loads for £50K or less – including 3 bedrm houses.

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  • Planning 4a crash – FYI – The studio flat we rented in putney was sold in June for 210k – so not quite 300k yet – and it took our landlady three months to sell. We paid £850 rent per month – which didn’t go up once in the five years we rented it. I was earning 50k and still couldn’t afford to buy it…that’s four times my income. And it just didn’t seem worth it – especially with a £2k annual service charge.

    We’ve moved to Asia on the back of my redundancy payment and we’re sitting it out here for a while. See you in 2009!

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  • Talking Rot – a rare (and welcome) voice of moderation.

    However, I’d say the base rate’s only half the picture. For the banks / building societies that fund themselves on the interbank market at c.6.9%, a mortgage rate of 5.75% + margin isn’t going to cut it. As the big banks hoard cash, the smaller ones (Northern Rock for example plus the swathes of finance chop shops) will increase their rates considerably more.

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