Reply to: An end to property?

[TykeMerc]

Given the bearish market and stagnation that is about to come, I simply can't see more foreigners pushing up London prices way further - another 10-15% over some years is still likely due to migration alone, so that might be good enough for the lucky few able to buy with a larger deposit.
For me a combination of a smaller deposit and the resulting higher rates and upcoming punitive taxation on LTV means I'm out again

I don't understand, are you saying you won't buy a house to live in because of these factors or you've been put off buying a BTL?

If it's the former and you seriously expect a downward movement on prices in your preferred area then it makes sense to wait, but the taxation comment doesn't compute in that case.

If it's BTL and you've only got a small deposit and were planning to leverage heavily, then yes it makes sense to think again as it's clearly something being targeted and high LTV may well be unwise.

[yasockie]

So what's the conclusion here?

Marry? Snog? Avoid?

Given the bearish market and stagnation that is about to come, I simply can't see more foreigners pushing up London prices way further - another 10-15% over some years is still likely due to migration alone, so that might be good enough for the lucky few able to buy with a larger deposit.
For me a combination of a smaller deposit and the resulting higher rates and upcoming punitive taxation on LTV means I'm out again

[ChimpMaster]

So what's the conclusion here?

Marry? Snog? Avoid?

[Zero Liability]

Which is why most governments avoid directly running the printing presses themselves - it's too easy to trace the blame.

[OwlHoot]

Plus, it's what the governments and central banks wanted them to do, so incentives were structured in that direction. The tune hasn't changed in that respect, so they're doing the same thing again.

Yup, plus when it became clear they had dug themselves into a hole that was about to collapse, they started digging down even more franticly knowing that the Government would then have to bail out most of them if bank failures were otherwise inevitable.

[Zero Liability]

Why was it stupid?

Subprime chaps made a killing on bonuses and retired early. Banks got bailed out by taxpayer.

Plus, it's what the governments and central banks wanted them to do, so incentives were structured in that direction. The tune hasn't changed in that respect, so they're doing the same thing again.

[PurpleGorilla]

An end to property?

Why was it stupid?

Subprime chaps made a killing on bonuses and retired early. Banks got bailed out by taxpayer.

Chuckle, yeah you're right there ;-)

[AtW]

Sub prime = banking stupidity.

Why was it stupid?

Subprime chaps made a killing on bonuses and retired early. Banks got bailed out by taxpayer.

[PurpleGorilla]

Sub prime = banking stupidity.

You think they've learnt their lesson?

http://www.ybs.co.uk/mortgages/95-percent/index.html

[Zero Liability]

Lovely, that dataset is from what source?

Incidentally prior to the monumental shakeup of the mortgage business caused by the whole "sub-prime" thing it was very easy to get upto and beyond 100% mortgages, quite a number of providers were offering 110%. It rather puts the 2005 35% bank of Mum and Dad number into context don't you think?

Had you ever wondered what "sub-prime" actually meant?

Or does that inconvenient truth rather get in the way of the agenda?

Indeed, that is a valid criticism of those 2005 figures, in that they were predicated on an unsustainable situation to begin with.

[AtW]

Ok, so the source is reputable, but what about the drastic difference in lending practices in 2005 to 2010? The numbers aren't comparable, they're a classic bankers' fraud (or mathematical bollocks if you prefer).

FTFY

Margin on very safe mortgage lending is much higher now than it used to be - cost of money right now to banks is effectively 0%, but they lend it at 3-4% in real safe market where money can't be lost. They are totally addicted to this margin and will aim to keep it when rates go up.

[TykeMerc]

Ok, so the source is reputable, but what about the drastic difference in lending practices in 2005 to 2010? The numbers aren't comparable, they're a classic statisticians fudge (or mathematical bollocks if you prefer).

[SueEllen]

The market is totally overheated and has been for upwards of 20 if not nearer to 30 years, that's not down to the people you obsess about the "Baby Boomers" who you blame for all the ills of the world past and present, but due to a huge jump from mass renting and large scale social housing to extensive ownership by the masses.

Load of tosh.

The housing market wasn't overheated in London and the SE let alone in the rest of the country between 1993 and 2001.

In fact loads of people in London and SE got out of negativity equity in 2001-2002.

Up until 2001 if you had a decent job e.g where a teacher you could get a mortgage on a 2 bedroom flat in places in zones 2 and 3 in London without many issues. Now you need about 12 times your salary.

[PurpleGorilla]

Lovely, that dataset is from what source?

Incidentally prior to the monumental shakeup of the mortgage business caused by the whole "sub-prime" thing it was very easy to get upto and beyond 100% mortgages, quite a number of providers were offering 110%. It rather puts the 2005 35% bank of Mum and Dad number into context don't you think?

Had you ever wondered what "sub-prime" actually meant?

Or does that inconvenient truth rather get in the way of the agenda?

council of mortgage lenders

http://inequalitybriefing.org/graphi...ime_buyers.pdf

[TykeMerc]

Lovely, that dataset is from what source?

Incidentally prior to the monumental shakeup of the mortgage business caused by the whole "sub-prime" thing it was very easy to get upto and beyond 100% mortgages, quite a number of providers were offering 110%. It rather puts the 2005 35% bank of Mum and Dad number into context don't you think?

Had you ever wondered what "sub-prime" actually meant?

Or does that inconvenient truth rather get in the way of the agenda?