snowboardboy

Yup I can see why you would say that things dont look great and it's easier to say things arent going to get better as no-1 is disappointed.

I just think the opposite due to the analytics i've looked at but my guess is no better than yours what I am reading or interpreting from what I read could be wrong.

mclauchlan35

True, most have although their all aimed at lower LTV's 60% etc.

snowboardboy

Yeah 40% is a big hit for a FTB but they will get there incentive from the stamp duty cut the 2nd and 3rd time buyers will get there incentives (maybe) from the lower rates on the lesser LTV'S

Tableland

You could be right, Loki; like I always say, no one knows the future. However, the big hope of oil reducing inflationary pressure and allowing a rate cut probably won't be enough to save the UK housing market. The US rate cuts were fast and furious, and only now, after months, and in conjunction with lower oil have they started to have even the smallest effect on US house prices. Britain, however, cannot go to 2% with the current inflation, and without a rate cut, the market can't improve.

On top of this, you have rising unemployment across the UK, heavily restricted lending, and of course, houses are stil about 7.5 times the average salary, which is significantly over their long-term trend average. And the worse thing of all has already happened: The Feeling. People now "feel" that houses are crashing, and are unlikely to invest in property until the market has corrected itself.

Alos, the stamp duty cut you refer to simply postpones paying it until next time round, when youwould have to pay two stamp duties, and I don't think anyone has been taken in by this.

mclauchlan35

The problem is that surveyors are now using 2006 valuations when pricing, (in Scotland anyway) and therefor people who purchased 2 years ago have the exact same LTV.

Payment shock is the biggest problem coming off a nice 4.5% rate going on to 6% plus or 7% if variable is a real challenge for people.

snowboardboy

Really?? That I didnt know! Without going deep into the articles most are saying "Abolish" which would imply that it isnt a sort hanging over there head.


As for the US rate cuts they are in a bit of a different boat from us there issue was people getting 100% mortgages without proper procedure and ending up with negative equity that the banks had to front. We havent seen this to such an extent due to the reg's we have around our loans. The credit crunch is now also beginning to ease sorry for the rubbish link but it was the first I could find

http://www.channel4.com/news/article...easing/2398372

This should help out borrowers as banks become more willing to lend.

Your spot on with the oil comment I would never think of oil as such a deciding factor in the UK we are used to paying high prices but perhaps this would help exports through haulage firms? Bit of a long shot on that one I must admit.

7.5 % above the average salary is true but with two people earning in a household at average salary that becomes 3.75% which isnt as killer.

I do like to have these conversations but I think i'm taking over the thread with rambling sorry if it's annoying anyone!

Tableland

I know a couple of people caught out this way, including one mixed up in NR. It's going to get worse as the year proceeds.

mclauchlan35

The 125% ones are going to be a killer N/R B/M AND Mortgage Express all have them with two or three others doing up to 110%. You can move the 95% part but then the unsecured part jumps up by around 9% therefor leaving people stranded on a variable. I think N/Rs is currently 8%.

cneldred

Bazzz,

I made that prediction on oil on 23rd May, when front month Oil Futures were trading $130 a barrel. The market then went 1 way for 8 weeks to the high of $149. The finally last week broke back through $125 to the current levels. I was bullish on oil and therefore RIGHT for 8 weeks.

I have commented a number of times that in the financial industry you have constant new data being feed into the market, therefore anyone trading the market has to adjust their calculations based on those bits of data.

I was long oil when it broke $125 on the way up i was holding looking for $200, and didn't sell until we dropped back through $140 (got under $138). Therefore i made a good profit on the trade. A good trader will use a moving stop when they are correct, protecting any profit.

You will see numerous posts on this thread where i have stated that the market constantly changes and often i have explained those changes as i did last week with regard to the currency rates.

Next time someone asks i question about the markets or economy i will wait until you have tried to explain the situation and then i will post my explanation.

Can i add you are either very sad or very frustrated person, i have yet to read a post on BE when you have either helped anyone out or not taken the piss out of someone. Get out more!!!!

cneldred

Oh, i would love to tell you how my year has been. But someone who is clearly as unstable as you are it would probably make you suicidal.

Tableland

Mervyn King says things are going to be OK because borrowers rates are coming down. What he doesn't say is that the MPC is going to have to raise rates to deal with inflation, and this will have an effect on the banks lending to us. The problem they have is that people finally get how much houses are over-valued and have watched this value falling away. I think it is unlikely that anyone who can read will be rushing to buy a house this year or next. I know I won't. They are just insanely above the average trend and cannot go on like this. A correction now will be a lot less painful than a correction in another three or four years, etc.

snowboardboy

Thats the thing though they dont have to raise rates right now to curb inflation. If they can avert a full blown recession by stimulating the housing market then the rate hike can come at a later date bashing inflation on the head perhaps causing a stagnation when it happens but I am sure even inflation nut King would rather hold rates and glance recession than raise rates and make it a full blown conclusion?

cneldred

Good friend of mine who is visiting at the moment is the manager of a Estate Agents in Essex. He says that they are selling stuff very slowly and at bad prices, (buyers offering way under asking price), but over half of sales they agree are collapsing a short way down the road.

He says that agents are bracing themselves for this lasting 3 to 4 years. Resulting in them closing branches and cutting advertising budgets.

snowboardboy

Nasty! The collapsing sales are the ones which cause the biggest issue too as they normally leave people worse off than they where when they went into the purchase due to fee's. Good luck to your friend!

mclauchlan35

Where I am a local estate agent who usually has 4 pages worth in the local paper last week had 1, not one page one house!!