By continuing to use the site, you agree to our use of cookies and to abide by our Terms and Conditions. We in turn value your personal details in accordance with our Privacy Policy.
Please log in or register. Registered visitors get fewer ads.
Comparing the current situation with 1989, when interest rates reached almost 15%, the Resolution Foundation predicted this year's rate rises would increase the cost of a typical mortgage by 3% of a typical household income, outstripping the 2.4% increase seen then.
Excellent stuff. Once again primarily people on the younger side taking the hit and people looking to buy being priced out. Dread to think what will happen to the rent market as well.
I'm amazed this isn't being talked about more widely. The interest rates in combination with house prices just constantly ballooning doesn't make any sense.
Mortgage rates are sure looking fun on 09:56 - Jun 17 by lowhouseblue
what would your strategy be for reducing core inflation? stripping out energy and food cost rises (which came from an external shock and will drop out of the figure over time) core inflation is 6.8%. that largely reflects what's happening in the labour market. how would you get it down?
Stripping out energy inflation must be difficult, would be interested to know how they calculated that. So many price rises from businesses are to deal with energy prices as well.
Mortgage rates are sure looking fun on 10:05 - Jun 17 by DanTheMan
Stripping out energy inflation must be difficult, would be interested to know how they calculated that. So many price rises from businesses are to deal with energy prices as well.
Indeed. Whilst it's possible to strip out food and energy as commodities, I'm not sure how you can strip out the impact of those higher costs on other sectors. Higher energy costs will inevitably push the costs of other commodities up and there are other sectors where higher food costs will similarly be driving up inflation.
Mortgage rates are sure looking fun on 09:43 - Jun 17 by Plums
I was discussing this with a few friends last weekend. All in our 50's and we concluded that a sizeable proportion of society are working and investing to provide a cushion for what is effectively end of life care. A thoroughly depressing outcome. The economy should work for us - not be the master we all seek to serve. There's a serious shift needed.
Sadly it is the inevitable outcome of the path Thatcher and the dominant economic model sent us on where selfish actions looking out for number one were and are encouraged over any concept of the greater good of society. Even more depressing is that those that work in professions that most benefit the greater good are generally paid the least while others offering nothing get to feel worthy by playing the game. We have turned our eyes from collective madness in the name of getting by.
"They break our legs and tell us to be grateful when they offer us crutches."
Mortgage rates are sure looking fun on 10:05 - Jun 17 by DanTheMan
Stripping out energy inflation must be difficult, would be interested to know how they calculated that. So many price rises from businesses are to deal with energy prices as well.
oh the ons guys and girls are very clever with their indices - i wouldn't claim to know how they separate out inflation components. but essentially the central fact about current uk inflation is that core inflation (ex energy and food) is 6.8% and private sector wage inflation is 6.9%. the problem with core inflation originates in the labour market.
in theory the long-term rise in mortgage debt relative to income ought to make interest rates rises far more effective - a small rise in mortgage rates ought to take a huge amount of consumer spending out of circulation. but that hasn't happened - in part because lots of people built up bank balances after covid and those have acted as a cushion, and in part because the labour market remains incredibly tight and employers have had to agree wage rises which they then pass on in price rises.
And so as the loose-bowelled pigeon of time swoops low over the unsuspecting tourist of destiny, and the flatulent skunk of fate wanders into the air-conditioning system of eternity, I notice it's the end of the show
0
Mortgage rates are sure looking fun on 10:15 - Jun 17 with 3246 views
Mortgage rates are sure looking fun on 10:15 - Jun 17 by BanksterDebtSlave
Not when there's nobody left who can afford them surely. Hopefully buy to letters will have to sell at a loss and some sort of reset can begin.
I moved house 2 weeks ago, into a new build site in Hertford, there are pockets of people living here, but a good 60% of the developments last couple of phases (last 12 months worth of building that has finished) are still empty. Quite a lot of these properties are shared ownership models and I suspect that what I am witnessing here, is very likely the start of the housing bubble reset. The people these properties were built for simply can’t afford them.
Mortgage rates are sure looking fun on 08:58 - Jun 17 by BanksterDebtSlave
House prices have started to come down as have and will rents. Hopefully the Lib Democrats proposed support for distressed mortgage payers won't get any traction as it would further support the bubble.
Completely agree about the lib dems plans - madness and regressive too.
On the more general inflation stuff, i belive the current wage rises are averaging about 7%, so maybe ita not all about supply side inflation now.
Has anyone ever looked at their own postings for last day or so? Oh my... so sorry. Was Ullaa
Mortgage rates are sure looking fun on 09:28 - Jun 17 by BanksterDebtSlave
In the long term are we heading to a situation where the majority of properties are in the hands of financial institutions as people take equity to fund social care costs and we are left with the pleasure of paying them rent do you think?
Historically (and nowadays in much of Europe) the majority of people rented, very few could afford to own property. I can see we're returning to that.
Mortgage rates are sure looking fun on 11:32 - Jun 17 by giant_stow
Completely agree about the lib dems plans - madness and regressive too.
On the more general inflation stuff, i belive the current wage rises are averaging about 7%, so maybe ita not all about supply side inflation now.
That's still a rise of below inflation and pay is only going up at those levels in the private sector. There's not suddenly a load of money floating about and people spending.
Mortgage rates are sure looking fun on 08:58 - Jun 17 by BanksterDebtSlave
House prices have started to come down as have and will rents. Hopefully the Lib Democrats proposed support for distressed mortgage payers won't get any traction as it would further support the bubble.
Agreed with your post on the Lib Dem policy proposal but rents aren’t going down, they’re skyrocketing.
Mortgage rates are sure looking fun on 10:13 - Jun 17 by BanksterDebtSlave
Sadly it is the inevitable outcome of the path Thatcher and the dominant economic model sent us on where selfish actions looking out for number one were and are encouraged over any concept of the greater good of society. Even more depressing is that those that work in professions that most benefit the greater good are generally paid the least while others offering nothing get to feel worthy by playing the game. We have turned our eyes from collective madness in the name of getting by.
Is laying all the blame on Thatcher fair? Thatcher’s time was certainly when selfishness was promoted above the greater good, so maybe it is fair (that’s pretty much all I remember from that time; making money above all else was seen as good, all hail the yuppies). I’m too young to know if Thatcher was a real trend setter or was building on other ideas from before.
Whether she was the first or following on from others, maybe it’s not important. She founded a movement that people still follow today and as it goes on the harms become more obvious. Her ideology certainly has a lot to answer for. I’m wondering if that was the time we diverged from the rest of Europe politically (they seem to have more options and more consensus, but maybe FPTP comes into that as well).
Mortgage rates are sure looking fun on 19:59 - Jun 17 by Swansea_Blue
Is laying all the blame on Thatcher fair? Thatcher’s time was certainly when selfishness was promoted above the greater good, so maybe it is fair (that’s pretty much all I remember from that time; making money above all else was seen as good, all hail the yuppies). I’m too young to know if Thatcher was a real trend setter or was building on other ideas from before.
Whether she was the first or following on from others, maybe it’s not important. She founded a movement that people still follow today and as it goes on the harms become more obvious. Her ideology certainly has a lot to answer for. I’m wondering if that was the time we diverged from the rest of Europe politically (they seem to have more options and more consensus, but maybe FPTP comes into that as well).
In relation to this thread I'm thinking primarily of selling off council houses and also public utilities. I believe it was the beginning of promoting the worse instincts of selfish individualism over the interests of wider society.
"They break our legs and tell us to be grateful when they offer us crutches."
Mortgage rates are sure looking fun on 09:02 - Jun 17 by BanksterDebtSlave
That's right isn't it. People banging on about coping with high interest rates back in the day were paying nowhere near the same percentage of disposable income.
Untrue. Back in 1989/90, over half of that year's FTB in London & South-East got repossessed as payments doubled from an average of one-third of take-home pay to two-thirds of take-home pay.
It was an interesting time to be working in mortgage credit risk...
0
(No subject) (n/t) on 23:57 - Jun 17 with 2533 views
Mortgage rates are sure looking fun on 23:45 - Jun 17 by Freddies_Ears
Untrue. Back in 1989/90, over half of that year's FTB in London & South-East got repossessed as payments doubled from an average of one-third of take-home pay to two-thirds of take-home pay.
It was an interesting time to be working in mortgage credit risk...
"They break our legs and tell us to be grateful when they offer us crutches."
Mortgage rates are sure looking fun on 20:29 - Jun 17 by J2BLUE
Fixed mine at 1.59% in Oct 2021 for 7 years.
I feel very lucky!
Our mortgage adviser sensed the proverbial hitting the fan last march and locked us in at 2% for 5 years. In hindsight I wish we'd have done longer, I can't see this situation easing for the foreseeable
0
Mortgage rates are sure looking fun on 09:58 - Jun 18 with 2384 views
Mortgage rates are sure looking fun on 23:45 - Jun 17 by Freddies_Ears
Untrue. Back in 1989/90, over half of that year's FTB in London & South-East got repossessed as payments doubled from an average of one-third of take-home pay to two-thirds of take-home pay.
It was an interesting time to be working in mortgage credit risk...
Statistically, it's worse now, as stated in the OP. Or at least according to the Resolution Foundation.
Makes perfect sense. The country borrowed 408 billion that it couldn't afford and has been living beyond its means for years. But you are right, there's not much talked about it though.
0
Mortgage rates are sure looking fun on 11:15 - Jun 18 with 2294 views
Mortgage rates are sure looking fun on 20:29 - Jun 17 by J2BLUE
Fixed mine at 1.59% in Oct 2021 for 7 years.
I feel very lucky!
We’re on 1.41% until October 2026 and overpaying as much as we can afford, a) to help reduce our term but mainly b) if we get October 2026 and the rates are still high, we won’t have to find as much money (if anything) if our monthly payments go up.
By continuing to use the site, you agree to our use of cookies and to abide by our Terms and Conditions.
