Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 7:45 am  

Sal Paradise wrote:

Banks need to be encouraged to relax the rules around house lending - not give away 100% mortgages but make it possible for youngsters to get on the ladder but at reasonable levels say: £100k house = 5% deposit, £200k is 10%, £300k is £15% etc so the risk is more appropriate.

This would help but in the absence of addressing the underlying supply problem (not enough houses) all that does is drive up prices. It means more people are enabled to buy so the prices that people can bid for the same scarce houses go up.

It's similar to the approach in the New Labour days - encourage banks to facilitate more people to be able to borrow.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 9:02 am  

sally cinnamon wrote:

I'm guessing that was late 1980s....the time when the Thatcherite dream died for a lot of people who had been enabled in to home ownership in the mid 80s and then suddenly found interest rates spiking and being unable to pay off their mortgages. Negative equity beckoned for a lot of people. That was what probably killed off Thatcher, around the same time as the Poll Tax, as it undermined her with her own core constituency.

These days, we have had low interest rates for so long that it has exacerbated the difference between those who have been able to get on the property ladder and those who are trapped trying to save for a mortgage, as rents have been what has skyrocketed rather than interest rates, although they've stabilised somewhat recently.

Interest rates have become an accident waiting to happen.
With rates having been so low for a number of years, much of the population are now in a position that, should there be any kind of hike in interest rates, they will be stuffed.
Having said that, for those who had been used to much higher rates, there has been a huge saving.
Unfortunately, the cost of all of this has been property prices, which as you say, have spiralled, which has a substantial effect of rented accommodation.
Despite the positive story from the previous poster, I really dont envy the youngsters who are trying to invest in their own property.
Who would have though that renting a room would become so commonplace and flats the size of a large shoe box- it's not great.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 9:18 am  

sally cinnamon wrote:

This would help but in the absence of addressing the underlying supply problem (not enough houses) all that does is drive up prices. It means more people are enabled to buy so the prices that people can bid for the same scarce houses go up.

It's similar to the approach in the New Labour days - encourage banks to facilitate more people to be able to borrow.

If there were more potential buyer then building companies would be prepared to build more houses - simple supply and demand proposition?

This is a very densely populated island in global terms - if we want to encourage people to live and work here we need to increase the housing stock. Mass building of rental properties is storing up a huge problem later down the line. Building affordable properties that people can get affordable mortgages seems like a win win to me.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 9:36 am  

cadoo wrote:

I thought you implied it was directly caused by Labour when that isn't true. I think the Tories - by their own admission - took austerity too far. To offer balance, retrospectively Labour were going to implement austerity measures too.

Your poverty question is one I asked myself too. How the hell can 4 million kids be in poverty. We dont see it on our streets and as you allude to when you think of poverty you think of African kids/Live Aid/Bob Geldof type appeals.

A child is said to be living in poverty when they are living in a family with an income below 60% of the UK's average after adjusting for family size. Two thirds of children living in poverty have at least one parent in work, which strengthens the argument for a rise in the national living wage so parents can feed their kids. A rise in food banks *41,000 in 2009, 1.6million in 2018* highlights the issue. How long can these emergency services keep up with demand before we see kids on the street? Do we need to see that before we take action?

Should we not expect (demand?) more from our political leaders? I think you're absolutely correct in his strategy, but if we cannot - or more so our PM refuses/ducks being held to account - then do we really live in a democracy?

Some really good points - but the low of averages suggests the 80/20 rule fits so 80% of the population will earn below the median. So if you take the poverty measure to be what you have alluded to then you will have loads of kids in "poverty" - they are not really in poverty though are they?

The rise in food banks is directly correlated to the universal credit issue - a good idea very badly executed. Once/if this settles down then the reliance on food banks will diminish - although why buy food when you can get it for free?

I agree our politicians are very poor and nearly all have very little experience outside of political life. We need less of them, they should have had experience in proper jobs - I don't mean working for think tank/union/quango - a proper job and their should be limits on how long they can be an MP say 10-15 years. We need to pay them more to attract better candidates.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 9:39 am  

wrencat1873 wrote:

It's great that you and your partner have managed to get on the property ladder.
However, a joint income of £50k is pretty good and or a "young" couple, I'd suggest that you are doing pretty well.

We could also go into stuff about the length of mortgage, which always used to be a standard 25 year term (quite often people are now being "sold" 35 year mortgages) and the other major issue currently, is the historical low on interest rates, something which the slightest uplift would cause huge problems for anyone with a significant loan.

No dout that you have done well to get where you are, especially without parental help but, I would be interested to hear how your peers are getting on ? - Thankfully, I've been there and done that and much of my time paying off a mortgage was when interest rates were in double figures, peaking at 15% under the Thatcher government- try not to think about that when you are having your cornflakes, it was the stuff of nightmares.

Completely agree - even a modest move in interest rates to say 5% which is historically very low would see huge property defaults. If the banks were pragmatic they would extend mortgage periods to cushion the blow but that is not how banks work sadly.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 1:19 pm  

wrencat1873 wrote:

It's great that you and your partner have managed to get on the property ladder.
However, a joint income of £50k is pretty good and or a "young" couple, I'd suggest that you are doing pretty well.

We could also go into stuff about the length of mortgage, which always used to be a standard 25 year term (quite often people are now being "sold" 35 year mortgages) and the other major issue currently, is the historical low on interest rates, something which the slightest uplift would cause huge problems for anyone with a significant loan.

No dout that you have done well to get where you are, especially without parental help but, I would be interested to hear how your peers are getting on ? - Thankfully, I've been there and done that and much of my time paying off a mortgage was when interest rates were in double figures, peaking at 15% under the Thatcher government- try not to think about that when you are having your cornflakes, it was the stuff of nightmares.

Oh you're spot on. We were sold a 40 year mortgage. Fixed for 3 years so the interest rate was high. It was a terrible deal, but it was a deal. We had no chance of 25 years & we were turned down on other applications (we had no bad credit history between us and had a 5% deposit).

You're correct RE peers. They are struggling by comparison. If they aren't in a relationship there is no chance. If anyone falls pregnant and are living at home they inevitably rent.

Perhaps someone on this forum will explain otherwise but I really believe if you have started off renting, I truly fail to see how you get a property of your own. I rented once for a job for 3 months in Manchester and I would have had no chance of saving.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 2:00 pm  

cadoo wrote:

Oh you're spot on. We were sold a 40 year mortgage. Fixed for 3 years so the interest rate was high. It was a terrible deal, but it was a deal. We had no chance of 25 years & we were turned down on other applications (we had no bad credit history between us and had a 5% deposit).

You're correct RE peers. They are struggling by comparison. If they aren't in a relationship there is no chance. If anyone falls pregnant and are living at home they inevitably rent.

Perhaps someone on this forum will explain otherwise but I really believe if you have started off renting, I truly fail to see how you get a property of your own. I rented once for a job for 3 months in Manchester and I would have had no chance of saving.

40 years ? that's one hell of a commitment

As you say, it's a real catch 22 - if you try and rent, there is little left towards saving for a deposit. Therefore, it's either live with the oldies, get some financial help from them or rent for a lifetime - unless you win the Euromillions

It's probably too late for you to change but, I would definitely recommend an offset mortgage if you can, as it will allow you to shave a few years of your loan.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 2:10 pm  

wrencat1873 wrote:

40 years ? that's one hell of a commitment

My mortgage was a 40 year mortgage when I took it out. It was the only way I could get one at the time, and that was with help from parents and one of them acting as a guarantor. I imagine a lot of first time buyers buying in the last 10-15 years will be on 40 year mortgages to start off with.

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 2:35 pm  

King Street Cat wrote:

My mortgage was a 40 year mortgage when I took it out. It was the only way I could get one at the time, and that was with help from parents and one of them acting as a guarantor. I imagine a lot of first time buyers buying in the last 10-15 years will be on 40 year mortgages to start off with.

In the old days parents used to guarantee bank loans to their kids - happy days

Re: Boris Johnson - spinless leader ? : Wed Dec 11, 2019 5:20 pm  

Sal Paradise wrote: In the old days parents used to guarantee bank loans to their kids - happy days They still can on pay day loans, the Tory alternative to food banks: https://www.independent.co.uk/news/uk/p ... 38076.html Force people to use food banks and then extort money from them through payday loan companies

Sal Paradise wrote: In the old days parents used to guarantee bank loans to their kids - happy days They still can on pay day loans, the Tory alternative to food banks: https://www.independent.co.uk/news/uk/p ... 38076.html Force people to use food banks and then extort money from them through payday loan companies