pegasus bridge Posted March 21, 2013 Report Share Posted March 21, 2013 I dont like what they are doing with housing at all. They are basically saying people cant afford to buy a house at these prices so lend them the money so the building industry can have something to do. Plus this is on new build houses so we arnt talking first time buyers that are trying to get on the ladder the people who really need help. It just seems a way to keep house prices up when by rights they should be going right down, that would actually help the economy and get the housing market going again. The rest of the budget just seems to be a big load of nothing. its more to do with the mortgage market, and how banks appetite for taking a risk is at a polar opposite to where it was prior to 2007, the net result is they are asking for large deposits on mortgages . i know of several working couples (decent paying jobs) who without parental help with deposits would not have been able to buy a property - despite being well able to service that mortgage. the assitance will (IMHO) help those stuck renting to buy, good move i would say, both for the indiiduals and the building industry. I'm just frustrated at our ring fencing of foreign development / aid - i would turn this off like a tap. Quote Link to comment Share on other sites More sharing options...
overandunder2012 Posted March 21, 2013 Report Share Posted March 21, 2013 (edited) new mortgage scheme 5% deposit its almost rude not to lol Edited March 21, 2013 by overandunder2012 Quote Link to comment Share on other sites More sharing options...
AVB Posted March 21, 2013 Report Share Posted March 21, 2013 I fear it is a recipe for disaster. Why do we have this fixation with home ownership. If you can't afford it on the terms available then rent. Why should I subsidise you? Quote Link to comment Share on other sites More sharing options...
mered Posted March 21, 2013 Report Share Posted March 21, 2013 I'm off out to drink 1000 pints and save a tenner Sorry to tell you Welsh Lamb, you will have to drink more than 1000 pints, its a penny off the beer tax, not the actual pint, started saving last night, might take a while though. Quote Link to comment Share on other sites More sharing options...
Vipa Posted March 21, 2013 Report Share Posted March 21, 2013 Then you have seen a different budget to me Pimp, He didn't say that at all, What he said was if people can save 5% of a deposit, but are struggling with the larger deposits that some banks are asking for, the scheme will help these people. By nature, these will be first time buyers beacuse if you already own a house you will not need a deposit. By the law of supply and demand, if more houses are built, prices will come down. The housing market is stuck through lack of lending as well as high prices. This will ( as has been said) create building jobs. On saying that Danny Alexander did not have an answer when asked what would happen if property prices went down. Overall, economies are cyclical and as land is finite, prices will go up in the long term. We do need to stop looking at houses as an income earner and start to look at them as homes again. Everyone wanted to be a property developer in the last few years and many of teh public throught they could spend and their increasing house values would allow them to pay everything off. The property market, be it residential or commercial is ruled by either fear or greed. Can I give you a perspective from the coal face? The 2 biggest issues I am facing with ANY mortgage application at the moment are down-valuations (more than 50% of applications for purchase or re-mortgage) and affordability. The budget can't really do much about the down valuation situation... the market is in general over valued and a further adjustment is required and more than likely to happen to bring things more into alignment. The issue with this is that, whilst there are a large number of properties out there over leveraged, a correction will not achieve much... those in negative equity will just sit tight and we will continue to have a shortage of stock on the market.. The big issue with the funding for lending scheme is affordability... The FSA have, since the crash, insisted that banks and building societies be more stringent with their affordability testing of applicants... It is not about the size of the deposit (although that is important) it is about monthly budgetary affordability... the lenders now scrutinise bank statements to build a picture of spending habits and this is going to get much much worse when the 'mortgage market review' comes into force. The estimate is that 50% of those currently with a mortgage would no longer be eligible for that mortgage under the new rules. that is just going to create mortgage prisoners and reduce availability further. As for the funding for lending side of things.. yes, it will help overcome the deposit requirements for some but the acid test is still affordability.. any rent paid for the deposit will be taken into account and slash what could be borrowed and so creates a catch 22 situation.. affordability fits but you have very limited savings.. use the funding for lending package and incur a rental charge and no longer fit affordability... It will help a very limited number of buyers.. Quote Link to comment Share on other sites More sharing options...
al4x Posted March 21, 2013 Report Share Posted March 21, 2013 the affordability is set at stupid levels as well, I know on ours we went through every hoop going despite a joint income that could cover the repayment 6 times over and no debt at all in fact the opposite a fair chink in savings Quote Link to comment Share on other sites More sharing options...
Vipa Posted March 21, 2013 Report Share Posted March 21, 2013 the affordability is set at stupid levels as well, I know on ours we went through every hoop going despite a joint income that could cover the repayment 6 times over and no debt at all in fact the opposite a fair chink in savings It is tight and set to become much tighter.. it's not the lenders lack of appetite its the lenders being scared ****less of the regulator! Quote Link to comment Share on other sites More sharing options...
SneakyD Posted March 21, 2013 Report Share Posted March 21, 2013 If you can't afford it on the terms available then rent. Why should I subsidise you? You shouldn't. A warning from Benjamin Franklin 'When the people find that they can vote themselves money, that will herald the end of the republic.' Quote Link to comment Share on other sites More sharing options...
Old Soldier Posted March 21, 2013 Report Share Posted March 21, 2013 Yeeeeeeeeeessssssssssssssssssssss a penny off beer,I'm deffo voting Conservative next election... Quote Link to comment Share on other sites More sharing options...
al4x Posted March 21, 2013 Report Share Posted March 21, 2013 It is tight and set to become much tighter.. it's not the lenders lack of appetite its the lenders being scared ****less of the regulator! indeed its silly levels at the moment we were as good a risk as they come and putting down 40% as well so it really made no sense, be interesting how this pans out as it needs a certain something to get things moving. Quote Link to comment Share on other sites More sharing options...
four-wheel-drive Posted March 21, 2013 Report Share Posted March 21, 2013 (edited) I fear it is a recipe for disaster. Why do we have this fixation with home ownership. If you can't afford it on the terms available then rent. Why should I subsidise you? That is fare anugh but why the hell should the rent for a house be as much as the people owning it are paying to buy it that dose not make sence to me my sisrer did this many years ago they bought a house and without even living in it rented it out to the navy when her husband retired from the RAF they had a free house wating for them. If they built a lot more houses then the price would drop to what it should be and people would then have the optin to rent or buy so rents would go down to a sensible level. As I see it there are only two ways that houses will get to low anugh for ordenary people to buy ( one a good plage to kill off half of the poplulation of the world) or ( another world war that notmaly works quit well ). Edited March 21, 2013 by four-wheel-drive Quote Link to comment Share on other sites More sharing options...
Vipa Posted March 21, 2013 Report Share Posted March 21, 2013 (edited) indeed its silly levels at the moment we were as good a risk as they come and putting down 40% as well so it really made no sense, be interesting how this pans out as it needs a certain something to get things moving. Unfortunately it is the FSA who are driving this and it will only get worse under the new regime. Lenders will also be forced to 'stress test' affordability too once the new rules come in, so affordability will ultimately be decided upon much higher interest rates, even if they aren't! The other change that is coming surrounds consolidation of debt. Lenders will no longer be able to disregard existing commitments even if it is the intention that those commitments be paid off with the mortgage funds.. so, affordability has to be tested INCLUDING the payments for the loans that are being cleared which, in most cases, will mean the application will fall outside of affordability and so make consolidating nigh on impossible for all but those who don't need to consolidate in the first place! Edited March 21, 2013 by Vipa Quote Link to comment Share on other sites More sharing options...
Vipa Posted March 21, 2013 Report Share Posted March 21, 2013 That is fare anugh but why the hell should the rent for a house be as much as the people owning it are paying to buy it That is only the case because we are in an abnormal situation with abnormal interest rates.. if rates were where the usually sit... 7 or 8% then that wouldn't be the case Quote Link to comment Share on other sites More sharing options...
pimpkiller Posted March 21, 2013 Report Share Posted March 21, 2013 Ill just point out I did get the wrong end of the stick with this bit of the budget, i thought he said we will lend you 20% then charge a payment on it after 5 years then you give back the original 20% out of what you sell it for. Still think its a bad idea, how much is the payment on 20%? you still will have to get a mortgage and risk the rates on 80% of an overpriced house and you will be missing 15% of the value when you sell and the house value may of gone down. This is actually aimed at someone like me in my situation paying £525 rent and cant buy because cant get together the deposit on an overpriced house. Wouldn't the government be better making up 100% first time buyer loans at a special rate (if they have the income)? Out of curiosity how much of a mortgage is £525? Quote Link to comment Share on other sites More sharing options...
pegasus bridge Posted March 21, 2013 Report Share Posted March 21, 2013 (edited) Out of curiosity how much of a mortgage is £525? as a very wild guesstimate £90K ? over 25 yrs Edited March 21, 2013 by pegasus bridge Quote Link to comment Share on other sites More sharing options...
pimpkiller Posted March 21, 2013 Report Share Posted March 21, 2013 thats not too bad then, they want 100K for a terraced/flat around here, we live in a spacious bungalow and I dont have to worry about anything knackering. Quote Link to comment Share on other sites More sharing options...
Vipa Posted March 21, 2013 Report Share Posted March 21, 2013 (edited) Ill just point out I did get the wrong end of the stick with this bit of the budget, i thought he said we will lend you 20% then charge a payment on it after 5 years then you give back the original 20% out of what you sell it for. Still think its a bad idea, how much is the payment on 20%? you still will have to get a mortgage and risk the rates on 80% of an overpriced house and you will be missing 15% of the value when you sell and the house value may of gone down. This is actually aimed at someone like me in my situation paying £525 rent and cant buy because cant get together the deposit on an overpriced house. Wouldn't the government be better making up 100% first time buyer loans at a special rate (if they have the income)? Out of curiosity how much of a mortgage is £525? That's like saying 'how fast does a car go' Depends what you want but work on £5.50 per month for every £1,000 borrowed on repayment over 25 years, e.g. £100k = £550. That's a good ball park figure, middle of the pack depending on big or little deposit. Mortgage only, doesn't accound for any mortgage related insurances. So.. working backwards on that basis... about £95k Edited March 21, 2013 by Vipa Quote Link to comment Share on other sites More sharing options...
Vince Green Posted March 21, 2013 Report Share Posted March 21, 2013 in theory the workers should be registered to pay uk tax. Probably not, they are able to widely exploit an EU loophole which allows temporary workers from another EU country to opt wether they pay tax in the country in which the money is earned or the country in which they are domiciled.So they all opt to pay it to their home country, of course. And of course you do believe they really declare it when they get home. Quote Link to comment Share on other sites More sharing options...
maxie Posted March 21, 2013 Report Share Posted March 21, 2013 Politically a good budget,economically a disaster.That`s quoting the FT,but what do they know? Quote Link to comment Share on other sites More sharing options...
pimpkiller Posted March 21, 2013 Report Share Posted March 21, 2013 It seems the sudden 1p off beer is almost a "screw you" to the other side for that cant organize a "knees up" in a brewery remark Quote Link to comment Share on other sites More sharing options...
spanj Posted March 21, 2013 Report Share Posted March 21, 2013 Balls still gets on my nerves, he helped get us into it, yet complains about it but with no real plans if they got back in. Yeah hes an objectionable *** superceded only by Miliband !!! Quote Link to comment Share on other sites More sharing options...
unapalomablanca Posted March 21, 2013 Report Share Posted March 21, 2013 Its just a kid yourself and play for time budget. Radical is whats needed, but it aint coming. Cuts, where? Guardian jam packed with public sector non jobs. Spending only at 2007 levels which were reckless beyond belief. I know a fire chief who just retired on a massive pension at FIFTY and walked straight into a security job on a grand a week. He might live till he's a 100, and if not his wife gets half. It really is unbelievable. Growth wont come when you shell out £250 billion a year in benefits. The games up in my opinion, no one can sort it so down is the only way. Sad thing is, it can be done, but too many protest, without looking at the big picture and just selfishly defend their narrow vested interests. In a way i feel sorry for osborne, what a pile of nonsense he inherited. Quote Link to comment Share on other sites More sharing options...
keg Posted March 21, 2013 Author Report Share Posted March 21, 2013 Yeah hes an objectionable *** superceded only by Miliband !!! Well put Sir!, Pimpkiller, just re-reade my post and it sounded agressive, was not meant to be so hope no offence taken. Quote Link to comment Share on other sites More sharing options...
Footu Posted March 21, 2013 Report Share Posted March 21, 2013 If normal rates are 7-8% then we have been below average for along time. So we must go above average for a long time later. So what happens to all those govnt loans when the default occur like they did in the 80s? Quote Link to comment Share on other sites More sharing options...
keg Posted March 22, 2013 Author Report Share Posted March 22, 2013 Its just a kid yourself and play for time budget. Radical is whats needed, but it aint coming. Cuts, where? Guardian jam packed with public sector non jobs. Spending only at 2007 levels which were reckless beyond belief. I know a fire chief who just retired on a massive pension at FIFTY and walked straight into a security job on a grand a week. He might live till he's a 100, and if not his wife gets half. It really is unbelievable. Growth wont come when you shell out £250 billion a year in benefits. The games up in my opinion, no one can sort it so down is the only way. Sad thing is, it can be done, but too many protest, without looking at the big picture and just selfishly defend their narrow vested interests. In a way i feel sorry for osborne, what a pile of nonsense he inherited. Very true and sadly the harsh cuts that do need to be made in the public sector and welfare will make any Party that pushes them through unelectable. Quote Link to comment Share on other sites More sharing options...
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