Originally posted by BlasterBates
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Previously on "If you were forming a political party what manifesto commitments would you make?"
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Originally posted by vetran View PostWhilst comparing it to inflation may seem to make sense actually you should compare against wages when considering affordability.
Housing affordability in England and Wales - Office for National Statistics
Few people have been getting wage rises over the last few years.
Mortgage payments are currently at 32% of mean take home pay. In 1980's it was consistently higher, in 1989 when interest rates shot up to around 15% it was 55%.
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Originally posted by vetran View Postwhat good is that going to do, where are those with poor credit going to live?
Best way to fix BTL is to make the returns less attractive by building more homes or have less people wanting them.
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I would remove or reduce student loans for those that study STEM subjects.
I would allow employers tax breaks for non-vocational training and apprenticeships.
But most importantly I will allow euthanisation of all the loud mouthed, inconsiderate twats that inhabit these isles, thus reducing population by at least 50%.
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Originally posted by BlasterBates View PostHouse prices are lower than they were 15 years ago
House prices will drop when the interest rates go up, always have and they always will. You bought at a time that was very unusual just after a housing crash and the interest rates had just dropped. House prices shot up over a 10 year period, and over the following 15 years dropped in real terms.
Whilst comparing it to inflation may seem to make sense actually you should compare against wages when considering affordability.
Housing affordability in England and Wales - Office for National Statistics
Few people have been getting wage rises over the last few years.
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Originally posted by vetran View PostFTFY
If you are trying to say that because interest rates are low people are risking more debt than is sensible then unfortunately you are right. Its a balloon of debt and will end in trouble however the fact there is a shortage of stock may cushion it.
House prices will drop when the interest rates go up, always have and they always will. You bought at a time that was very unusual just after a housing crash and the interest rates had just dropped. House prices shot up over a 10 year period, and over the following 15 years dropped in real terms.
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Originally posted by BlasterBates View PostI think I am being condescending but really I didn't explain my point very well.
FTFY
If you are trying to say that because interest rates are low people are risking more debt than is sensible then unfortunately you are right. Its a balloon of debt and will end in trouble however the fact there is a shortage of stock may cushion it.
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Originally posted by vetran View Postso you don't repay the capital at all? The amount of interest you pay has no relation to the capital?
From your calculator
you borrow £200,000 at 1.6% (the default) you pay back £242,000
you borrow £100,000 at 3.2% you pay back £145,000
so doubling the price means you pay nearly 100k more even though the interest stays the same. Yes you pay 100% more interest if you double the interest rate but that is obvious.
However as to your point about affordability the doubled capital nearly doubles the repayments. Both mortgage examples have about 45k iinterest
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Originally posted by BlasterBates View PostMost of what you pay for a house when you buy is interest.
Mortgage calculator
Double the interest rate and see what happens to your mortgage.
so you don't repay the capital at all? The amount of interest you pay has no relation to the capital?
From your calculator
you borrow £200,000 at 1.6% (the default) you pay back £242,000
Your monthly payment
£809.30
Your monthly payment
£484.68
However as to your point about affordability the doubled capital nearly doubles the repayments. Both mortgage examples have about 45k iinterest
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Originally posted by vetran View Postdo please explain your assertion.
feck me glad you don't go anywhere near figures. Its like having Assgoo back.
Mortgage calculator
Double the interest rate and see what happens to your mortgage.
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