Friday, March 6, 2009

Loan To Income Ratios Down To 4 X’s And Falling

House Prices will carry on falling

Last week the FSA spoke about mortgage regulation and loan to income being a better way to ensure there is never a repeat of the past 10 years. This week on the blogs there was a thread about income multiples with Northern Rock loans being set at 3.5 max. The basis of this article is THAT THERE IS NO RUSH TO GO AND prices will NEVER be allowed to BOOM again. They have a long way to fall in line with income and then the kind of rise we saw in the past 10 years could take up to 40 years to get back in line with wages. THE MORE WE HEAR ABOUT LOAN TO INCOME THE BETTER because it irrefutably confirms that house prices are going down down down because the UK cannot afford to support an inflated house price market

Posted by kathryn layard @ 10:16 PM (802 views)
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4 thoughts on “Loan To Income Ratios Down To 4 X’s And Falling

  • I was telling Mrs Paul this tonight. For practical ends, house prices will never recover from what is happening now. Never.

    Japan’s did the same. We will never see a house price boom for as long as we live. That’s it. The chips are spent. Stop and think about it – do you think the mortgage lending banks will ever be allowed to get away with this again? After the crap that we’ve had to go through to get the economy back on track?

    Property is dead as an investment. The sooner the old guard of the likes of Anne Ashworth, Rebecca O’Connor and David Smith get a grip on that the better.

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  • if this is going to be the norm then house prices should start plummetting overnight so why doesn’t the govt step up and reset the market value of property as there are millions of buyers waiting to jump in and buy a home, surely this would help get the economy moving saving jobs

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  • Completely agree. Look at Germany. Banks have always lent prudently – hence there has never been a boom. If people only realised that mortgaging up to the hilt means you’re stuck. Lose job? –> well stuck. Want to move to a better job? –> stuck. Think you’ve got a retirment honey-pot? –> illusion. Want to give it to the kids? –> taxman says me first.

    What we spend on our luxuries should not be out of debt (trapping you to leech professionals), but out of saved money that would otherwise be your equity. Think rent until the kids have left home. Then perhaps buy somewhere warm in your 50’/60’s

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  • Missingteddybear says:

    Anne Ashworth wrote two articles yesterday; one about how much a bargain property is and those with cash are taking advantage and investing and the other’s tagline was “The nearness of deposit account returns to size zero is set to direct investors back into the property market”…
    Her stupid spin about ftbs being desperate to buy and just can’t get financing has gone beyond the point of being comical and is starting to make me really angry. Once in a blue moon, if I’m on a long train journey I might buy the Times, but I am now avowed to never purchase this paper so long as they continue to publish Ashworth’s poisonous slew of drivel.

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