Real or Nominal. How will the HPC manifest?

[Bobthebuilder]

9 minutes ago, haroldshand said:

Herring is quite good(sliver darlings) we also have bags of spider crabs in our waters that is lovely and better than the common brown crab, also mussels are still a bargain, live 1 Kg bag about £4 ish

You are preaching to the converted here. A decade ago I used to go diving for lobsters and spiders, also snorkeling with a spear gun, but I was never much successful with that. Cant beat some mackerel as well.

[haroldshand]

12 minutes ago, Bobthebuilder said:

You are preaching to the converted here. A decade ago I used to go diving for lobsters and spiders, also snorkeling with a spear gun, but I was never much successful with that. Cant beat some mackerel as well.

I remember going sea fishing and feathering for mackerel and catching 50 odd in minutes just to catch the "better fish" using them as bait, yes you are right they are a good healthy tasty fish and so cheap

[Formerly]

3 hours ago, Bobthebuilder said:

I got a letter from my bank today. The SVR on my small offset mortgage is now 6.5%.

That's effectively 6.5% on the cash that's offsetting it then .

[Formerly]

My estimate is about 50% down in real terms from the peak, with inflation doing 20% and nominal falls the rest. Just my gut feeling and I'd love to see more on the nominal side.

[Bobthebuilder]

14 minutes ago, Formerly said:

That's effectively 6.5% on the cash that's offsetting it then .

On my small mortgage, I have saved £9000 in interest over 4 years at SVR.

14 minutes ago, Formerly said:

My estimate is about 50% down in real terms from the peak, with inflation doing 20% and nominal falls the rest. Just my gut feeling and I'd love to see more on the nominal side.

Current inflation could do more than that.

[Formerly]

42 minutes ago, Bobthebuilder said:

On my small mortgage, I have saved £9000 in interest over 4 years at SVR.

Current inflation could do more than that.

Well aware of that. Especially if it drags out over years like the early 90's. My feeling is that this will be MUCH quicker. There are a lot of external factors pressuring prices this time and in the early 90's information traveled far more slowly. Rightmove wasn't even around then, let alone easy public access to land registry sold prices. Early last year people I know, who were firmly in the prices always go up camp, were talking about the Covid gains meaning a crash was likely (house prices are not a common subject of conversation, but they know I want to move). This was before they realised the extent of the inflation happening and the impact on mortgage rates. , although there will still be those who don't believe a crash can happen, sentiment is on the turn.

 

 

Then again, perhaps it's just wishful thinking!

[Formerly]

54 minutes ago, Bobthebuilder said:

On my small mortgage, I have saved £9000 in interest over 4 years at SVR.

Current inflation could do more than that.

<Martin Lewis mode>

Just think what you could have saved with a big mortgage!

</Martin Lewis mode>

[Bobthebuilder]

14 minutes ago, Formerly said:

Rightmove wasn't even around then,

I have tried to explain, why I think it will be much quicker now than the early 90s for years. You have hit the nail on the head, with that one line.

[Wight Flight]

It's OK.

Key worker discount will save the market...

https://www.thepriceiswight.co.uk/product/barratt-key-workers-deposit/

[Formerly]

1 minute ago, Wight Flight said:

It's OK.

Key worker discount will save the market...

https://www.thepriceiswight.co.uk/product/barratt-key-workers-deposit/

We might be able to get that discount. Can't wait until it's applied to 2nd hand detached houses with land.

[Wight Flight]

Just now, Formerly said:

We might be able to get that discount. Can't wait until it's applied to 2nd hand detached houses with land.

I'm holding out for the student discount.

[One percent]

3 minutes ago, Bobthebuilder said:

I have tried to explain, why I think it will be much quicker now than the early 90s for years. You have hit the nail on the head, with that one line.

It always amazed me how slow that fall was.  
 

another issue today that wasn’t there in the 90s crash is the amount of property held that isn’t a home.  You are going to hold onto your home if you possibly can and just ride out any negative equity. It will be a very different thought process if you are dealing with spare property, whether it’s a rental or second home. 

[Petatep]

9 minutes ago, One percent said:

It always amazed me how slow that fall was.  
 

another issue today that wasn’t there in the 90s crash is the amount of property held that isn’t a home.  You are going to hold onto your home if you possibly can and just ride out any negative equity. It will be a very different thought process if you are dealing with spare property, whether it’s a rental or second home. 

Brilliantly put. A spare pair of shoes or a spare coat, thats ok and prudent (just up wind up @spygirl) but you're right, there are people out there with a spare house, how fucked up is that.

[spygirl]

6 minutes ago, Petatep said:

Brilliantly put. A spare pair of shoes or a spare coat, thats ok and prudent (just up wind up @spygirl) but you're right, there are people out there with a spare house, how fucked up is that.

Its does not tend to be spare.

Normally mortgages, grossly over exposing to a single asset class.

[Axeman123]

Headline: Reprieve for trapped homeowners as Britain’s biggest mortgage lender scraps cladding rules

"...Hundreds of thousands of homeowners trapped in buildings with cladding may now be able to sell their properties after Britain’s largest mortgage provider scrapped its ban on lending. Lloyds has removed its requirement for blocks of flats that are five floors or taller to have an EWS1 certificate, a standard practice that had prevented some homeowners from getting mortgages...Lloyds said it was responding to revised guidance from the Royal Institution of Chartered Surveyors, a trade body, which outlined how to assess the value of properties affected by fire safety issues."

Seems very wishy washy, eg surely even without a purchaser having to pay for the works the likely disruption of them being undertaken would have to be reflected in the valuation. Interesting to note as well that people with more than three properties are expected to pay their own way! Anyone building a rental portfolio with affected newbuild flats is still screwed.

Likely upshot is that valuations will be possible but at massively discounted values, and if anything this will bring backlogged supply to market. How this interacts with Help to Buy will also be interesting; eg will the government accept writing off large sums when HtB properties affected by outstanding cladding works are sold at a loss, or insist on unacheivable valuations?

Source (Telegraph via Yahoo Finance):

https://uk.finance.yahoo.com/news/reprieve-trapped-homeowners-britain-biggest-180813584.html

[One percent]

3 minutes ago, spygirl said:

Its does not tend to be spare.

Normally mortgages, grossly over exposing to a single asset class.

It’s still a spare no matter how it’s financed. My argument is that it will be viewed very differently from the main residence,  to use the establishment parlance.  They will be hitting the market very quickly as the only was that either btl or fhl made any sense is rising equity. Once prices start to fall there will be a stampede for the exit. 

[MrXxxx]

On 18/12/2022 at 13:11, Formerly said:

Or will it really mean that as soon as prices dip, they'll all jump in and "snap them up"

Hopefully as the two events ['Getting out whilst you can' and property crash/price drops] will be sufficiently close enough to discourage this behaviour, especially if some of them taken a 'haircut' by doing so.

[One percent]

2 minutes ago, Axeman123 said:

Headline: Reprieve for trapped homeowners as Britain’s biggest mortgage lender scraps cladding rules

"...Hundreds of thousands of homeowners trapped in buildings with cladding may now be able to sell their properties after Britain’s largest mortgage provider scrapped its ban on lending. Lloyds has removed its requirement for blocks of flats that are five floors or taller to have an EWS1 certificate, a standard practice that had prevented some homeowners from getting mortgages...Lloyds said it was responding to revised guidance from the Royal Institution of Chartered Surveyors, a trade body, which outlined how to assess the value of properties affected by fire safety issues."

Seems very wishy washy, eg surely even without a purchaser having to pay for the works the likely disruption of them being undertaken would have to be reflected in the valuation. Interesting to note as well that people with more than three properties are expected to pay their own way! Anyone building a rental portfolio with affected newbuild flats is still screwed.

Likely upshot is that valuations will be possible but at massively discounted values, and if anything this will bring backlogged supply to market. How this interacts with Help to Buy will also be interesting; eg will the government accept writing off large sums when HtB properties affected by outstanding cladding works are sold at a loss, or insist on unacheivable valuations?

Source (Telegraph via Yahoo Finance):

https://uk.finance.yahoo.com/news/reprieve-trapped-homeowners-britain-biggest-180813584.html

Thanks.  I’m sure that the crazy maintenance charges will put even more people off these properties. I wouldn’t touch one with your barge pole, never mind my own. 

[MrXxxx]

7 hours ago, haroldshand said:

A keto nightmare, that would make me ill for a week, cannot imagine anyone with a commitment to "good health" eating shit like that.

But we all 'fall off the wagon' occasionally...it's just that when you do it's important not to give up and go back to this diet full-time.

[MrXxxx]

3 hours ago, Bobthebuilder said:

You are preaching to the converted here. A decade ago I used to go diving for lobsters and spiders, also snorkeling with a spear gun, but I was never much successful with that. Cant beat some mackerel as well.

'Platy bashing' in a drift is the way to do it!