Mortgage

[Tree13]

Bit of EA spin, that. You never see the areas with bad schools or poor transport links fall in price, do you?
One-way street thinking.

It's nothing to do with demand and supply. It's about the availability of cheap credit.

Areas with bad schools and bad transport links don't rise in price at the same rate. They MIGHT have other factors going for them, but commuter belt properties in the home counties are pricy for a reason - loads of people want them because of their location.

And it is an awful lot about supply and demand. People want to live in certain areas, so developers are therefore motivated to build ever-smaller properties that sell for eye-watering prices. Demand is in part driven by the proliferation of cheap credit because without it less people would be in a position to buy, but cheap credit doesn't make bad properties in crime-ridden areas, lacking any transport links and served only by failing schools, any more desirable.

 

[Chang Elephant]

there will come a day when the market will have its pound of flesh. There will be a full blown currency crisis, market interest rates will spike overnight, and there will be nothing that the government can do about it. Argentina. Greece. Spain. The examples are there if you look for them.

Yet another leftie running down the benefits of capitalism. Get a job son and stop sponging off the state.

 

[SteKelly]

The better deposit you have the better it is right?

I'm staying at home for as long as possible.

 

[nsno-chris]

Just seen a lovely apartment for sale in L1 opposite the Hilton with great views and I've been thinking about moving out for a while with my girlfriend.

I've been doing research on them and just don't understand them at all!

The apartment is 269,000 and we can put a 40,000 deposit down which I understand means we need to take out a £229,000 mortgage, correct?

I went on Halifax, Santander etc and they are all saying I would need to pay roughly £1,272 per month which is £636 each per month we would be paying.

Now this is the thing but bare in mind I don't know how to word it correctly so please forgive! the apartment is brill and I don't understand why everyone doesn't just live in places like that instead of not very luxury.

600pm sounds quite cheap for a brilliant apartment in the middle of L1. Obviously with everything (TV etc) it would come to about 800 we would pay EACH but even that sounds good for the views etc.

Is this correct or just completely wrong?

I live in L1, but I rent. I'll tell you why i would never purchase any apartments in town. If this is a new build apartment i guarantee its all electric, so good luck keeping warm in the winter; the apartments have not been designed to withstand the corrosion from the sea water (just look at the Malmaison apartments, Alexandra Tower and William Jessop Way).

Also you can probably add another £100 a month for the ground rent, i.e. the upkeep of the corridors and public area; these can go up whenever. Also, the resale ability of apartment is extremely low compared to a house; how many families want to live in town and how many couples can afford £269,000.

 

[thirdmantackle]

The better deposit you have the better it is right?

I'm staying at home for as long as possible.

earn cash on nixers or second job and save it
would be better

 

[evilwebby]

Areas with bad schools and bad transport links don't rise in price at the same rate. They MIGHT have other factors going for them, but commuter belt properties in the home counties are pricy for a reason - loads of people want them because of their location.

And it is an awful lot about supply and demand. People want to live in certain areas, so developers are therefore motivated to build ever-smaller properties that sell for eye-watering prices. Demand is in part driven by the proliferation of cheap credit because without it less people would be in a position to buy, but cheap credit doesn't make bad properties in crime-ridden areas, lacking any transport links and served only by failing schools, any more desirable.

Why did house prices double or triple in places like Scotland or Hull when the population has actually fallen? It's nothing at all to do with demand and supply of actual housing, it's all to do with cheap credit being directed into the property market, same as with all asset bubbles. Rents haven't doubled in real terms, so home prices shouldn't have either.

I'm not saying that in some areas there hasn't been an increase in population density, but that is not the primary reason for such high prices.

Prices in commuter belt are high because... prices in the city are even higher.

 

[evilwebby]

Yet another leftie running down the benefits of capitalism. Get a job son and stop sponging off the state.

Haha, I think you're mistaking me for someone else. I'm the offspring of Ayn Rand and Milton Friedman (http://www.grandoldteam.com/forum/threads/54467-Idealology?p=1822314#post1822314).

 

[Deleted member 28206]

Just seen a lovely apartment for sale in L1 opposite the Hilton with great views and I've been thinking about moving out for a while with my girlfriend.

I've been doing research on them and just don't understand them at all!

The apartment is 269,000 and we can put a 40,000 deposit down which I understand means we need to take out a £229,000 mortgage, correct?

I went on Halifax, Santander etc and they are all saying I would need to pay roughly £1,272 per month which is £636 each per month we would be paying.

Now this is the thing but bare in mind I don't know how to word it correctly so please forgive! the apartment is brill and I don't understand why everyone doesn't just live in places like that instead of not very luxury.

600pm sounds quite cheap for a brilliant apartment in the middle of L1. Obviously with everything (TV etc) it would come to about 800 we would pay EACH but even that sounds good for the views etc.

Is this correct or just completely wrong?

£270k is a lot of money mate, for a view.

 

[evertony]

Buy a caravan.

Great views that can change every day if you want. No knobhead neighbours. And, fat-arsed birds love them ( see My Big Fat Gypsy Caravan etc). And you'll have plenty of spare cash to fit it out lush.

Bingo.

 

[Foot Long Hot Dog]

You are wrong on that, but not for the reasons you think.

Rates will be kept low indefinitely by the BoE/Goverment, because they are aware that the economy is so leveraged to cheap debt that any increase in cost will kill the recovery - they will never raise them voluntarily.

However you can't buck the market indefinitely, and there will come a day when the market will have its pound of flesh. There will be a full blown currency crisis, market interest rates will spike overnight, and there will be nothing that the government can do about it. Argentina. Greece. Spain. The examples are there if you look for them.

You're talking out your hoop lad. The currency crisis in Spain & Greece have no relevance to the UK as they were caused by the
Inability of the state to repay the national debt. It's a total red herring to introduce that into a discussion about the relative value in the UK housing market

 

[evilwebby]

You're talking out your hoop lad. The currency crisis in Spain & Greece have no relevance to the UK as they were caused by the
Inability of the state to repay the national debt. It's a total red herring to introduce that into a discussion about the relative value in the UK housing market

At what point does UK debt become unrepayable, then?
Because last time I checked it was still rising unsustainably.

 

[Foot Long Hot Dog]

At what point does UK debt become unrepayable, then?
Because last time I checked it was still rising unsustainably.

The deficit is now reducing as the economy recovers & unemployment falls. The massive spike in the national debt was solely due to the worldwide economic crash & there's nothing to suggest that there's any danger of us defaulting, you're pedalling nonsense in suggesting it.

 

[Dell Boy]

The deficit is now reducing as the economy recovers & unemployment falls. The massive spike in the national debt was solely due to the worldwide economic crash & there's nothing to suggest that there's any danger of us defaulting, you're pedalling nonsense in suggesting it.

Correct. All day long.

The second anyone that matters seriously thinks the UK is on skid row then we're all f*cked as the price of our debt would be crippling within the day.

I'm not saying things are rosey but this talk of impending doom is quite ridiculous. We all need to de-leverage but it's going to be a gradual process of 3-5 years of steadily increasing base rates.

 

[evilwebby]

The deficit is now reducing as the economy recovers & unemployment falls. The massive spike in the national debt was solely due to the worldwide economic crash & there's nothing to suggest that there's any danger of us defaulting, you're pedalling nonsense in suggesting it.

Vaulted.

The Deficit still exists and is large enough that debt is still growing faster than GDP and while that is true then eventually there will eventually come a day where it is no longer sustainable. Our economy is dependent upon the expansion of credit, ie debt growth, and with such a structure of production there will never come a day when we can balance the books without actually destroying the sector that creates all the growth. Your 270k flats in Liverpool - that's your economy right there. That's where 40 years of monetary doctoring has got us.

 

[evilwebby]

Correct. All day long.

The second anyone that matters seriously thinks the UK is on skid row then we're all f*cked as the price of our debt would be crippling within the day.

I'm not saying things are rosey but this talk of impending doom is quite ridiculous. We all need to de-leverage but it's going to be a gradual process of 3-5 years of steadily increasing base rates.

LOL, they haven't even stopped printing money yet, never mind started to raise rates. It will just never happen. They've boxed themselves in and there is no way out that won't collapse the economy anyway.

To quote Milton Friedman: Nothing is so permanent as a temporary government program.