Mortgages

[Swervin_Mervin]

I've said it before but central banks the world over, ours included, have fucked this right up. They've completed ignored house price inflation for the last 2 decades whilst allowing historically low interest rates, then ratchet up interest rates to and tackle supply side inflation (rather than an over-heating economy) and then have surprised pikachu faces when inflation doesn't come down again. Well dur. What a fucking mess.

Exactly this. Inflation isn't being caused this time by people borrowing. Its increased energy prices and a shortage of workers that's causing this. Hiking the interest rate surprisingly (not) isnt working. It's just making folk struggle. The housing market is just mental and has been for the last 5 years. Our house has gone up nearly 30% in value since we bought 5 years ago.

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there, but looing at its history it had doubled in value in the 10-15years before that as well.

I'm fairly sure that printing lots of cash 15yrs ago wasn't the greatest idea, as quite a few economists warned at the time.

[Sundayjumper]

Location dependant surely

Definitely. I sold my flats in 2018. I've just checked and the online valuation thingies reckon they've not really moved since. In fact one of them resold in 2021 for *less* than I sold it for in 2018.

This all makes me glad I got out.

[Sundayjumper]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

[Jobbo]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

Over the period, a great investment - CGT free (if your main home) and against an inflation rate of ~2%. Also leveraged if you have a mortgage.

Now they’ll need to double at least every 10 years to keep place with inflation. This time next decade, Rodders: we’ll all be millionaires (if we own a two-up, two-down in Birmingham or equivalent).

[Swervin_Mervin]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

I was just reiterating the mental of previous posters. Not that I'm calling Scott a mental

A 6-fold increase in 25years seems fairly incredible to me, but I've no idea what the average would be over that period, ir indeed what it might have been in the 25yrs before that.

[scotta]

Net migration was 600,000 people here last year, and everyone needs a house.

Can’t be long before interest rates are rapidly cut though - maybe towards the end of next year, even London feels much less busier these days - I thought it was the school half term on Tuesday it was that quiet. Feels like everything is on the brink of crashing.

Agreed.

[Swervin_Mervin]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

Over the period, a great investment - CGT free (if your main home) and against an inflation rate of ~2%. Also leveraged if you have a mortgage.

As an aside, I hadn't even realised until recently that even a main home isn't CGT exempt if it's over an acre in size. Do you get people splitting land up into different titles if it's just over the threshold?

[Simon]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

Over the period, a great investment - CGT free (if your main home) and against an inflation rate of ~2%. Also leveraged if you have a mortgage.

Now they’ll need to double at least every 10 years to keep place with inflation. This time next decade, Rodders: we’ll all be millionaires (if we own a two-up, two-down in Birmingham or equivalent).

A terrible investment. At the end you still own 'one house' (that you live in) and your next upsize is likely made more difficult as a result of a bigger gap. Cheaper houses would be great - it'd leave more money for people to spend on the high street and into the wider economy. The negative effects of high house prices are wide reaching and numerous.

[dinny_g]

The housing market has been pretty mental for the last 20yrs! Ours has probably doubled in the 11yrs w've been there...

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

Mine increased just 3.2% pa over 18 years to 2021 - this was a good quality 60's build Semi Detached in a small Northamptonshire village

It only "re-hit" the value it had in early 2008 in 2014 so near 7 years of appreciation was gone due to the banking crisis

[duncs500]

Cheaper houses would be great - it'd leave more money for people to spend on the high street and into the wider economy. The negative effects of high house prices are wide reaching and numerous.

Do we really need more stuff off the high street (or amazon in reality)? When I was a nipper house prices were much lower relative to annual income yet in my anecdotal experience people had far less new stuff all the time, people kept stuff much longer and it was a much less disposable society which was probably better for the environment too.

Complex subject of course, but I can't help thinking we aren't really winning by expecting a certain substantial level of disposable income to burn on crap.

[duncs500]

No doubt me being an old cunt. Not saying those were better days, but I hate that it's cheaper to always throw stuff away than get it mended nowadays.

[Jobbo]

Doubling in 11 years is ~6.5% pa. Better than cash in the bank, but hardly "mental".

Over the period, a great investment - CGT free (if your main home) and against an inflation rate of ~2%. Also leveraged if you have a mortgage.

As an aside, I hadn't even realised until recently that even a main home isn't CGT exempt if it's over an acre in size. Do you get people splitting land up into different titles if it's just over the threshold?

You wouldn’t need to split the title. The exemption may still apply for over 1.24acres; you would need to demonstrate that all of it was garden: https://www.taxinsider.co.uk/how-does-y ... ur-home-ta

Simon, I’m talking retrospectively about the figures - it’s a great rate of return. Don’t think I’m making any predictions about buying a residential property now.

[Carlos]

Capitalism doesn't work if we are happy with what we've got. We've become massive consumers of travel and experiences as well as house tat, fashion, tech etc and we've become programmed to accept these things are essential to life and happiness. 50 years ago essentials were food, clothing and a roof over your head.

The shit that's as important as those fundamentals in 2023 is bizarre. Unless someone's income has dropped people should be able to manage to fund a residential mortgage with a 5% interest rate.

And to be clear I'm not mocking anyone as It's the same in my own house. On bin day I often catch my daughter throwing out brand new clothes as she couldn't be bothered to send them back!

[Mito Man]

It's a difficult thing to balance, capitalism allows employment, if all frivolous things were cut out you'd probably end up with unemployment levels similar to third world countries. Population and automation are just too great these days and it will only get worse.

[Carlos]

That's not really my point. I'm probably in Duncs miserable old cunt camp as i feel marketing and consumerism in the last 20 years has blurred the lines between what we need and want.

[DeskJockey]

That's not really my point. I'm probably in Duncs miserable old cunt camp as i feel marketing and consumerism in the last 20 years has blurred the lines between what we need and want.

I'm with you then. The amount of pointless tat we seem to "must have" or that's made to break quickly is staggering.

[Broccers]

I'd definitely not be fixing at the current fixed rates. Interest rates aren't predicted to shoot up much higher than the are, and they are expected to go back down a bit in time.

My insights are a bit more on the money.

Good to see you admitting you're totally incorrect

[Broccers]

Our neice in a two bedroom 400k flat in London is not happy as their fix ends later this year.

Are interest only options available @holley

[Shlergen]

Ours is out till June next year but I can't see it settling by then. Outside of fixed, the rates are absolutely dogs, the SMR (replaced BMR) is in the 7+% range and I don't think there are any tracker deals worth looking at as the banks are playing the system.

[Jobbo]

I'd definitely not be fixing at the current fixed rates. Interest rates aren't predicted to shoot up much higher than the are, and they are expected to go back down a bit in time.

My insights are a bit more on the money.

Good to see you admitting you're totally incorrect

It’s not like you to state you’ve won when the game has barely started, Broccers

I passed on predictions and I’d point out that 5% base rate is still a fair bit lower than it was when I bought my first house (6.75% I think) and my mortgage rate was 3.95%. Let things settle rather than panicking. If you fixed at 5% for 5 years you might think you’ve done well, but come 2024/25 maybe not.