Reply to: What happens to property if GBP crashes?

[AtW]

It won't happen as lenders have been strict

[Menelaus]

Indeed, he's got more front than Margate, Rodders.

Or Dolly Parton / "Jordan" / etc ...

[DimPrawn]

He's certainly got chutzpah though, coming back here, you got to give him that

Indeed, he's got more front than Margate, Rodders.

[TimberWolf]

There are still 120-180,000 properties waiting to be repossessed in the UK - with borrowers on "special measures".

This is just a front to fiddle with balance sheets - all of these properties will be repossessed and sold on eventually.

And all to be blamed on the next government. Or Thatcher.

[Moscow Mule]

There are still 120-180,000 properties waiting to be repossessed in the UK - with borrowers on "special measures".

This is just a front to fiddle with balance sheets - all of these properties will be repossessed and sold on eventually.

[sasguru]

True, but it's not like you would tell fibs is it?

He's certainly got chutzpah though, coming back here, you got to give him that

[doodab]

Here's something that the UK media seems to have overlooked: in a small majority (by volume) of instances, self-certificated mortgages perform better than non-self certified mortgages. I'm not sure why either.

I suspect because a) they involve a certain amount of personal responsiibilty taking and judgement as to what one can afford and b) the criteria for non-self-certified lending became increasingly relaxed, so there is a largeish pool of non-self-certified mortgages that are riskier than they once were or are at the moment.

[Menelaus]

True, but it's not like you would tell fibs is it?

Not when appropriately medicated, dear boy, not when appropriately medicated.

[DimPrawn]

*Note: I am not an FSA authorised person, and the above should not be treated as advice or information in any way nor should it be used as the basis of any investment decision. Always carry out due diligence. Always stress test. And always, always, always - wear clean underwear in case you're hit by a car crossing the road.

True, but it's not like you would tell fibs is it?

[Menelaus]

The dubious self-certs that people talk about are - generally (note, all generalisations are dangerous, including this one) speaking - a fallacy.

I spend all of my day surrounded by swathes of both residential and BTL mortgage performance data both for the mortgages themselves and their outside factors (e.g., HMLR data, AVM outputs).

Here's something that the UK media seems to have overlooked: in a small majority (by volume) of instances, self-certificated mortgages perform better than non-self certified mortgages. I'm not sure why either.

As for the sub-prime debacle: the big issue isn't going to be the issue of residential mortgages - the hit's been taken there already, and I'd expect the market to be returning slowly, licking its wounds.

The next biggie will be in refis. There's very little long money in the markets at the moment which means that refinancing has not had anything like the ability to be able to place a long-term, low-interest margin on itself. The next period when debt will need to be rolled over is 2011.

Batten down the hatches, me hearties!

*Note: I am not an FSA authorised person, and the above should not be treated as advice or information in any way nor should it be used as the basis of any investment decision. Always carry out due diligence. Always stress test. And always, always, always - wear clean underwear in case you're hit by a car crossing the road.

[doodab]

It won't happen as lenders have been strict, there are plenty of people who could easily afford a much higher rate being refused.

Some would argue this is the way it should be.

Lenders have only been strict again for the last couple of years. There are plenty of people who took out 5 year trackers and dubious self certs in 2007 or earlier.

There are also quite a few buy to let landlords who are already struggling to cover the interest only mortages on their portfolio because rents have fallen. A rise in interest rates will push a few of these people into negative cashflow at which point they either have to sit it out for as long as possible or crystallize any capital gain or loss. We haven't really seen the fall out from the buy to let boom yet.

[gingerjedi]

Property is fliped in this country. Wait till interest rates start increasing.

People who took out loans at 3% won't know what hit them.

It won't happen as lenders have been strict, there are plenty of people who could easily afford a much higher rate being refused.

Some would argue this is the way it should be.

[Menelaus]

If the pound crashes the cost of imports such as food and oil will increase so much that everyone will become poor and unable to afford to buy property so the prices will drop.

This will create an opportunity for overseas buyers to snap up cheap English properties. There will be TV programmes in newly rich countries like India that show Indians travelling to England to look for holiday homes.

These programmes will be called A Place in the Rain.

Pity that Christian Digbie won't be around to advise them

[SantaClaus]

Property is fecked in this country. Wait till interest rates start increasing.

People who took out loans at 3% won't know what hit them.

[snaw]

It's already happening. In the posh parts of London the prices are seeing double digit inflation with the buyers mainly being foreigners.

Good stuff.

Anything that raises house prices in London is a very fine thing with me indeed.

Couple of year bubble would suit me nicely.