B of E is a joke.As is its alleged 'independance'.

Everyones puppy,eager to please.

 

I am about to buy my first house. I looked at houses about 2 years ago in the town i live in. They have since doubled in price so any drop in price would be very useful to me only problem being now that banks are not keen to give out mortages due to the current climate in the market.

 

Up until very recently me and the other half were considering buying a house, we were going to move up from a 1 bed flat to a 3/4 bed house.

I think we will wait a while now and see what happens.

 

Why not sell your flat, trouser the equity, earn interest on it, then buy your 3/4 bedroom place in 2/3 years at a lower price?

 

And live where? the mortgage is under £500 p/m atm, to rent we will be looking at prob £800.

 

So thats an extra £300 you'll be paying. But how much are you loosing on your flat per month, if prices are dropping in your area?

 

Plus I assume the £800 per month is for a 2/3 bedroom flat, as opposed to a 1 bed flat - If you rent similar to what you have now, you should certainly be able to get it for less than £800.

Christ you can get is for less than that in Harrow and Brighton - And they are about the most expensive places in the universe.

 

A flat similar to ours (1 bed) will let for around £700 PCM, looked into it as we was considering keeping it on if we could to let.

Bit of a tricky one to explain as the flat is actually the gf's I have moved in and we planned to get a bigger place. And confincing her to sell and move into rented wont happen.

I see what your saying, but its not quite that easy.

 

in that case straight away you loose @1.5% estate agents fees, the cost of moving then if you've a good mortgage rate at the moment for example a cheap tracker then you loose that and rely on getting a decent deal later on in this mortgage climate. So if say prices don't go down then you've no flat you've lashed out a load of rent and an extra moving bill.
Its easy to spend other peoples money on the internet

 

That's looking extremely unlikely now.

 

depends where you are my area they're still on the up, there is a lot of trying to talk them down I'd certainly not take the gamble of moving into rented with the costs involved, especially in a flat at the lower end of the market as a small drop and the buyers will be back even if its the buy to let investors, for whom this is a bonanza as the demand for rental properties is stronger than its been in ages with the associated raising of rent just because they can

 

Cant really see the point in the BoE lowering the rate - the lenders wont pass it on for ages, if at all, but will cut the savings rates straight away - oh, hang on, that means the banks benefit, but none of their customers do !

OK, there are some people on base rate trackers who will benefit, but I wonder how many of these there are compared to people on the lenders standard rate, fixed rates or other sorts of mortgage ?

One thing I do think is that if house prices come down, the cost of mortgages for FTB's will rise ( either in high lending rates, or loading on big setup fees for people who dont have a 20% deposit etc... ) so it isnt going to get much cheaper in real terms for FTB's for a while yet.

 

Everyone should hang on - it will destroy the market, and prices will undershoot their true values as generally happens in a crash.

You only stand to gain really, assuming you can hang on.

 

HAlifax have been clever cookies, they revamped all their products on Sunday upping the 5.79% rate to 5.99 and creating a slightlty {and I mean slightly} better rate for low %age mortgages.
In anticipation of the BOE reduction I imagine they will now offer a minor reduction to the rates which in turn will make people think they are getting the benefit of the .25% reduction somewhere.

 

No one wants to by a house that you have to get to by boat round here.

 

We are in no desperate rush to move now, so no problem hanging on for a while.

 

[QUOTE=MikeCardiff;7799189]Cant really see the point in the BoE lowering the rate - the lenders wont pass it on for ages, if at all, but will cut the savings rates straight away - oh, hang on, that means the banks benefit, but none of their customers do !

QUOTE]

Or put it up!

The problem is the banks are making too much money out of this. They know people need mortgages so can charge what they like.

In Novemember Nationwide had a loyalty product fixed for 5 years at 5.63% now it's 6.15% despite 0.75% in base rate drops.

They need a BoE mortgage.

 

The banks are absolutely skint, due to the American sub prime market which in turn means that banks are unwilling to lend to other banks, which in turn means they don't have as much capital as they did - Which is why they are not reflecting the BoE 0.25% cut to new customers - They are trying to actively discourage people from borrowing money that can't afford it.


It got bugger all to do with them trying to make more money out of us - Any gians you get from not lowering your rate, is offset by not as many people borrowing.

 

funny, they posted profits in the billions.

 

Thanks to interest rate hikes! Borrowers pay for the "policy" of Govn't mismanagement.

 

Good news for me, I've got a little tracker mortgage!

I think the crash is being talked up to be honest, it may correct by 10 - 15%, but that's hardly a crash, will just take them down to levels of a couple of years ago, which were already way over what they should be.

Halifax just announced a house price rise in E Anglia.

 

Pete does make a good point. But the simple fact is there should have been regulations in place years ago to help control the masses.

 

I don't think the banks are skint. More like they are having to put Billions aside to cover bad debts due to the American House price drop. And also to cover themselves with the uncertainty over the UK house prices.

This has made disposable cash an issue. So they've started charging each other more interest for that cash.

 

Funny how history repeats itself!

YouTube - Spitting Image - Madness sing Our House spoof

Spitting Image from during the last crash!

 

Friend of my wife had a letter from Northern Rock drop through the door, saying that they were "unable to offer a competitive interest rate in the future, and they should consider switching to another provider".

Problem is they self certified for their NR mortgage and "inflated" their incomes.

Fooked?

 

If they can't afford what they have to take, then possibly. Depends if they have enough equity to sell and downsize, IF they can sell in this market.

The fall in the amount of money left after all the bills are paid will do far more damage to the economy than the fall in house prices.

Lets pray we don't start to see a lot of companies start to panic and lay off loads of staff

 

So you over paid by £50k and have now been devalued by £11.25K Bummer!

 

I bought for £184k and it's now worth about £310k!

Damn these falling house prices!

 

...and everything else has also gone up by £100K odd too

 

Nah - Tell him to talk to a broker. If it was a blatant 'I earn 150k' when he earns 20 lie then he is fooked. However - NR are still obliged to offer him SVR for the term of the mortgage. If he earns 30 and said he earns 35, there is a good chance he could get a deal with Abbey, Halifax, Bos or A&L. (They use different affordability criteria.)