Thursday, January 15, 2009

Help the ones in arrears will only freeze the market further

One borrowers in arrears prevents up to 80 other customers getting a mortgage

One average mortgage in arrears for an extended period could cost as much as 30 new mortgages. But if the held mortgage has a riskier, low loan-to-value this cost could increase to 80 new mortgages. So the more GB attemps to help those in arrears, the fewer FTB can entre market (with a multiplier of 30 to 80!) and further freeze the market! Great! Please bail out all 75,000 repossesions! That will stop 6 million new buyers!! Then HPC will be really spectacular!!

Posted by peter_2008 @ 12:00 AM (1035 views)
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2 thoughts on “Help the ones in arrears will only freeze the market further

  • GB can’t be that stupid (or can he ?) and imo this goes to show that he’s not interested in FTB or home ownership but exactly the opposite. Less homes being built and limited mortgages available means lower home ownership, that is his goal, no more boom and bust is exactly right. Its going to be bust, bankrupt and game over for a large majority of the middle class.

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  • stillthinking says:

    Our foolish government cannot ever accept that a bottoming of house prices asap is best, both for home-owners, FTBs, and the resumption of lending, for the simple reason that such a process exposes the last decade as a useless sham, and a transfer of wealth primarily away from the private sector poor. The very group they were supposed to represent before they morphed into the political arm of government workers. Hence “lunatics running the asylum” is particularly apt (as they are themselves government workers).

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