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House prices rising 'at fastest annual rate for three years'
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Author:  pcernie [ Thu Jul 04, 2013 8:14 pm ]
Post subject:  House prices rising 'at fastest annual rate for three years'
http://www.bbc.co.uk/news/business-23177576

It's not even doing that much over here... I'd imagine that between QE or lack of, inflation, jittery global markets and the government ready to take the axe to civil servants of every hue, this is more hype than substance.
Author:  jonbwfc [ Thu Jul 04, 2013 8:37 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Without geographical variation data this is next to useless. It could mean lunatic priced mansions in Knightsbridge have doubled in price whereas most of the rest of the country has stood still.
Author:  JohnSheridan [ Fri Jul 05, 2013 2:26 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
The house around the corner from me has been on the market now for about 4-month and still hasn't sold although we think they are asking too much for it.
Author:  Amnesia10 [ Fri Jul 05, 2013 6:29 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
JohnSheridan wrote:
The house around the corner from me has been on the market now for about 4-month and still hasn't sold although we think they are asking too much for it.

I think that what people are asking is ridiculous. Two agents round here regularly suggests price around 20% above what they eventually go for and they sit on the agents books for months. If the person is a genuine seller they end up having to take lower prices to actually move it. I think that it all depends whether the people can actually get mortgages to move.
Author:  E. F. Benson [ Sat Jul 06, 2013 7:51 am ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Auntie just sold for 250 after an asking of 300 :(
Author:  l3v1ck [ Sat Jul 06, 2013 1:43 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Well that will help with the Loan To Value ratio when I remortgage next year.
It's touch and go whether it'll be below 60% for the best rates.
Author:  Amnesia10 [ Sat Jul 06, 2013 10:10 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
l3v1ck wrote:
Well that will help with the Loan To Value ratio when I remortgage next year.
It's touch and go whether it'll be below 60% for the best rates.

Have you worked out how you will afford it once interest rates rise? With bonds starting their big sell off it will mean rates will eventually rise back towards more normal rates. Could you afford 7%?


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Author:  l3v1ck [ Sun Jul 07, 2013 4:14 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Yes.
My wife and I weren't reckless when we bought our house. We allowed for rate rises (when they've actually fallen) and we kept about £10k back for a rainy day.
That helped a lot a few years ago when I lost my job.
Author:  Amnesia10 [ Sun Jul 07, 2013 8:03 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
l3v1ck wrote:
Yes.
My wife and I weren't reckless when we bought our house. We allowed for rate rises (when they've actually fallen) and we kept about £10k back for a rainy day.
That helped a lot a few years ago when I lost my job.

As long as you have not over extended yourself then you should be fine. If with these low rates you are overpaying then you should be fine once rates rise. Though I doubt that they will rise for a couple of years anyway. Though if Central bank policy should fail it will be rapid.


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Author:  l3v1ck [ Mon Jul 08, 2013 1:49 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Assuming the rates are about the same as they are now, next September, when our currect deal runs out, we'll be able to afford about £100 per month more than we pay now. That combined with the reduced interest rates since we last remortgaged means we can go from what should be 18 years left on our mortgage to a 13 year mortgage. That'll be a five year fixed. By the end of that period, even if the rates have gone up to 7%, we shouldn't have any major issues with the monthly payments. I did look at the few ten year ones that are coming back on the market. But they're a whole percent more. Not really worth it in my opinion.
Author:  Amnesia10 [ Mon Jul 08, 2013 2:04 pm ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
l3v1ck wrote:
Assuming the rates are about the same as they are now, next September, when our currect deal runs out, we'll be able to afford about £100 per month more than we pay now. That combined with the reduced interest rates since we last remortgaged means we can go from what should be 18 years left on our mortgage to a 13 year mortgage. That'll be a five year fixed. By the end of that period, even if the rates have gone up to 7%, we shouldn't have any major issues with the monthly payments. I did look at the few ten year ones that are coming back on the market. But they're a whole percent more. Not really worth it in my opinion.

I would be very careful. If you can get a new deal now then try, there are more than 200 European banks at risk of failure and if they collapse this summer then I have no idea what will happen to rates here. Interest rates could soar and while you might be fine for the duration of the current deal you might find things very different by next September.
Author:  hifidelity2 [ Wed Jul 10, 2013 10:13 am ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
Amnesia10 wrote:
l3v1ck wrote:
Assuming the rates are about the same as they are now, next September, when our currect deal runs out, we'll be able to afford about £100 per month more than we pay now. That combined with the reduced interest rates since we last remortgaged means we can go from what should be 18 years left on our mortgage to a 13 year mortgage. That'll be a five year fixed. By the end of that period, even if the rates have gone up to 7%, we shouldn't have any major issues with the monthly payments. I did look at the few ten year ones that are coming back on the market. But they're a whole percent more. Not really worth it in my opinion.

I would be very careful. If you can get a new deal now then try, there are more than 200 European banks at risk of failure and if they collapse this summer then I have no idea what will happen to rates here. Interest rates could soar and while you might be fine for the duration of the current deal you might find things very different by next September.

If any more banks fail then interest rates will stay low as the governments will have to prop them up again
I am happy with my variable rate - had them since the mid 80's - the week after taking out my first mortgage rates hit 17%. At the moment they are nice and low and making big overpayments - as they rise so the overpayment reduces to keep the same level of overall payment
Author:  Amnesia10 [ Wed Jul 10, 2013 10:40 am ]
Post subject:  Re: House prices rising 'at fastest annual rate for three years'
hifidelity2 wrote:
If any more banks fail then interest rates will stay low as the governments will have to prop them up again
I am happy with my variable rate - had them since the mid 80's - the week after taking out my first mortgage rates hit 17%. At the moment they are nice and low and making big overpayments - as they rise so the overpayment reduces to keep the same level of overall payment

I would tend to agree, but policy is changing and with bail-ins now the official policy for future bailouts to avoid tax payer involvement it all depends on what people will do with their money. Banks would need to offer significantly more to raise sufficient funds from savers to offset the risks. That will significantly impact lending rates. As long as you are over paying then the risks as rates rise will be minimised. Though with a stagnant economy I do not see the government being able to raise rates for years if not decades.
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