That's the bedist above the kebab shop fooked

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NoddY replied

20 February 2008, 15:05
Originally posted by PAH View Post

The only other solution would be to allow for growing wage inflation so people find it easier to get on the ladder.

This scenario is still a house price crash because the value of a house is lower, but the price stays the same.
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PAH replied

20 February 2008, 15:03
It has the feel of a pyramid scheme, with the first time buyers asked for a higher and higher entry fee until it becomes unworkable. Even more so when you see that many first timers involve others in the purchase to be able to afford it.

Maybe that's why a property crash of some sort is inevitable, regardless of what the banks or government do and have done.

The only other solution would be to allow for growing wage inflation so people find it easier to get on the ladder.
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Sockpuppet replied

20 February 2008, 14:51
Originally posted by BrilloPad View Post

dont first time buyers only make up 28% of the market? even less now?

Yes, but they bring new moeny into the market.

A old person moving house from a £350k house to a £375k house else where doesn't really affect the market. A first time buyer moving into a £200k house bring potentially £200k of new money into the pot.
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PAH replied

20 February 2008, 14:45
Originally posted by Troll View Post

Northern Rock - still doing 125%

Some would class that as sub-prime. Oh the irony.
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BrilloPad replied

20 February 2008, 14:30
dont first time buyers only make up 28% of the market? even less now?
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Troll replied

20 February 2008, 14:26
Northern Rock - still doing 125%
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PAH replied

20 February 2008, 13:26
People will still get loans from elsewhere. They'll have to. There can't be many first time buyers that have managed to save up many thousands of pounds for a deposit.

Stopping mortgages of close to or over 100% is a good idea though, that was always going to end in tears when the market inevitably slowed down.

All this will do is mean people have to take out more expensive forms of loans, unless they're fortunate enough to have gullible parents that'll lend it to them out of equity on their own homes!
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Sockpuppet replied

20 February 2008, 12:59
Seriously. 100%+ mortgage had bad idea written all over them.
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DimPrawn started a topic That's the bedist above the kebab shop fooked

20 February 2008, 12:45
That's the bedist above the kebab shop fooked

http://news.bbc.co.uk/1/hi/business/7254426.stm

First-time buyers could face a financial headache as the market for 100%-plus mortgages shrinks.

Four lenders are this week pulling the plug on deals offering mortgages topped up with an unsecured loan.

The offers allowed first-time buyers to get on the property ladder without a deposit, but were also criticised for letting people take on more debt.

The move could lead to higher repayments for first-time buyers when they come to remortgage.
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