House Prices #3 Property market, buying and selling

Are you...

  • A homeowner with a mortgage fixed for 2 years

    Votes: 92 16.9%

  • A homeowner with a mortgage fixed for more than 2 years

    Votes: 204 37.4%

  • A homeowner not on a fixed mortgage

    Votes: 28 5.1%

  • A homeowner currently looking to move or remortgage

    Votes: 44 8.1%

  • A FTB still saving for a deposit

    Votes: 43 7.9%

  • A FTB with a deposit saved, currently seeking properties

    Votes: 29 5.3%

  • Renting with no intention of buying

    Votes: 11 2.0%

  • Renting but hope to buy in future

    Votes: 64 11.7%

  • Other...

    Votes: 30 5.5%
  • Total voters
    545
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1
hydeist said:

Track Record Mortgage - Skipton Building Society

If you’re renting but looking to buy your first home, our Track Record mortgage uses your rental track record to help you onto the property ladder.
www.skipton.co.uk www.skipton.co.uk

You can put in your rent and what term of mortgage you'd apply for here and it gives you a rough idea - but it says they also do normal affordability and it'll give you the lower of the two amounts. It's definitely not a lot, but with an interest rate of nearly 6% £850 a month doesn't buy you much house anyway.

Using your £250,000 example and the 5.49% interest Skipton gives on this mortgage:

View attachment 2159576 q
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See I've been reading online that it is also based on 4.5 times your income?
So would we then take it form the £850 we pay a month which would mean we can't buy anything round where we live lol, or would it be our salaries combined x 4.5? So bloody confusing
 
LifeOfMog said:
See I've been reading online that it is also based on 4.5 times your income?
So would we then take it form the £850 we pay a month which would mean we can't buy anything round where we live lol, or would it be our salaries combined x 4.5? So bloody confusing
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It’s the £850 you pay a month, it explains it on the link a little. It’ll have you do two affordability calculators but you have to use the lower amount for what you can afford.

so frustrating but I understand they have to be strict with this to avoid some of the same issues they have back in 2008
 
ls240898 said:
It’s the £850 you pay a month, it explains it on the link a little. It’ll have you do two affordability calculators but you have to use the lower amount for what you can afford.

so frustrating but I understand they have to be strict with this to avoid some of the same issues they have back in 2008
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This is definitely not going to work for most people - our combined would give us an allowance of £324,000 but our monthly rent gives us £150,000 which will not even get us a 1 bed retirement property lol
 
LifeOfMog said:
This is definitely not going to work for most people - our combined would give us an allowance of £324,000 but our monthly rent gives us £150,000 which will not even get us a 1 bed retirement property lol
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I guess it also excludes people who are living in a house share too. I read online it will benefit people in the North the most, because house prices are cheaper. But we are in a small town in the north and £160k doesn’t get us very far!
 
If interest rates go down a bit it’ll be much more helpful - for example I’ve bought a £246,000 house, 10% deposit, 4.3% interest and it will cost £1000 a month.
So even if the interest rate goes down 1% over the next year it’ll benefit you a lot with monthly repayments, and therefore allow you to borrow more for this mortgage type.
 
Folkevermore said:
If interest rates go down a bit it’ll be much more helpful - for example I’ve bought a £246,000 house, 10% deposit, 4.3% interest and it will cost £1000 a month.
So even if the interest rate goes down 1% over the next year it’ll benefit you a lot with monthly repayments, and therefore allow you to borrow more for this mortgage type.
Click to expand...
Sorry I’m not very good with interest rates etc but isn’t the interest for the 100% mortgage fixed at 5.49% for five years?
Do we think more products like this will be coming to market, surely they aren’t the only one. I imagine there might be some alternatives coming soon
 
ls240898 said:
Sorry I’m not very good with interest rates etc but isn’t the interest for the 100% mortgage fixed at 5.49% for five years?
Do we think more products like this will be coming to market, surely they aren’t the only one. I imagine there might be some alternatives coming soon
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It is, but that means if you take out the loan now it’ll be fixed at 5.49 for five years once you are accepted for the mortgage and move in.

The actual rate the bank offers changes all the time. So if rates come down, the fixed product they’re offering could be changed to a lower rate.
 
Folkevermore said:
It is, but that means if you take out the loan now it’ll be fixed at 5.49 for five years once you are accepted for the mortgage and move in.

The actual rate the bank offers changes all the time. So if rates come down, the fixed product they’re offering could be changed to a lower rate.
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Oh I see thank you!
 
I must be honest I sighed when I heard it announced that they were releasing a product like this. To me , it’s a real sign of the unsustainable artificially high property prices when the salary multiplier is so much higher than anything that is even remotely sensible. And that almost always brings a correction in the housing prices. The biggest issue that I have with this product is the release at a time when property prices look toppy (at best) and a lot of economists forecast falls in value. You never know where we are (for sure) in the rollercoaster of property pricing but for those of us old enough to have lived through any of the last recessions it certainly feels like we are there now. I say that as Bank Manager who managed a Recovery Team for one of the main UK banks through the 90s recession. Property has felt like a one way bet for a while now but things can go wrong very quickly.
The problem with a 100% mortgage is that you could very easily be “trapped” into being unable to remortgage into a rate you can afford at the end of the 5 year fixed rate period. Because in a falling/static property market you will probable still owe at least 100% of your house value. You can of course stay on the offered variable rate that the Skipton will offer in 5 years but who knows what this will be and this will determine your mortgage monthly payment.. A mortgage debt is one that remains even if the house price falls to lower than the loan and whilst that is hugely galling if you were to be unlucky and lose any equity it is even worse if you had no equity to play with. It could saddle you with long term financial issues.
Property prices don‘t matter if you 1) Don’t have to/need to/want to move 2) your income is stable to be able remaining servicing the debt that you have. The problem comes when something happens that you didn’t plan either to income or to your life. Having equity gets you a bit of breathing space.Having no equity gives no breathing space so just bear that in mind when you are deciding whether to risk it. For example, if you have 2 stable salaries and a possible parental financial support network then OK (Does any of us have this!) If you have 2 very iffy salaries and no other financial support then I wouldn’t have thought it was wise. It’s already a very expensive product now with the fixed rate. Cast your mind forward 5 years and ask if you would still want to be forced to be paying 2% premium pa on hundreds of thousands of pounds with no ability to secure a lower rate because of the lack of equity (if property prices have peaked). We used to get people in the 90s who would post the keys back and think that was it. But it isn’t because you are still liable to service the debt and for any shortfall Even if you move out. (Apologies for those on the thread who already know this I’m just trying to give some guidance to those who don’t!)
 
Swisspea said:
I must be honest I sighed when I heard it announced that they were releasing a product like this. To me , it’s a real sign of the unsustainable artificially high property prices when the salary multiplier is so much higher than anything that is even remotely sensible. And that almost always brings a correction in the housing prices. The biggest issue that I have with this product is the release at a time when property prices look toppy (at best) and a lot of economists forecast falls in value. You never know where we are (for sure) in the rollercoaster of property pricing but for those of us old enough to have lived through any of the last recessions it certainly feels like we are there now. I say that as Bank Manager who managed a Recovery Team for one of the main UK banks through the 90s recession. Property has felt like a one way bet for a while now but things can go wrong very quickly.
The problem with a 100% mortgage is that you could very easily be “trapped” into being unable to remortgage into a rate you can afford at the end of the 5 year fixed rate period. Because in a falling/static property market you will probable still owe at least 100% of your house value. You can of course stay on the offered variable rate that the Skipton will offer in 5 years but who knows what this will be and this will determine your mortgage monthly payment.. A mortgage debt is one that remains even if the house price falls to lower than the loan and whilst that is hugely galling if you were to be unlucky and lose any equity it is even worse if you had no equity to play with. It could saddle you with long term financial issues.
Property prices don‘t matter if you 1) Don’t have to/need to/want to move 2) your income is stable to be able remaining servicing the debt that you have. The problem comes when something happens that you didn’t plan either to income or to your life. Having equity gets you a bit of breathing space.Having no equity gives no breathing space so just bear that in mind when you are deciding whether to risk it. For example, if you have 2 stable salaries and a possible parental financial support network then OK (Does any of us have this!) If you have 2 very iffy salaries and no other financial support then I wouldn’t have thought it was wise. It’s already a very expensive product now with the fixed rate. Cast your mind forward 5 years and ask if you would still want to be forced to be paying 2% premium pa on hundreds of thousands of pounds with no ability to secure a lower rate because of the lack of equity (if property prices have peaked). We used to get people in the 90s who would post the keys back and think that was it. But it isn’t because you are still liable to service the debt and for any shortfall Even if you move out. (Apologies for those on the thread who already know this I’m just trying to give some guidance to those who don’t!)
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Bang on. It’s a risk but probably a risk I would have taken if I didn’t get a help to buy property last year.

It is totally inflating the market, though.
 
Me again, newbie 👋🏻

Re mortgage repayment periods, what’s the maximum number of years you can do it over? Does it differ depending on age? (There’s 12 years between my boyfriend and I so would it make a difference?) Apologies if that makes no sense and I look like a twat 🤪
 
lozzapaloozza said:
Me again, newbie 👋🏻

Re mortgage repayment periods, what’s the maximum number of years you can do it over? Does it differ depending on age? (There’s 12 years between my boyfriend and I so would it make a difference?) Apologies if that makes no sense and I look like a twat 🤪
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Typically 40 is the absolute max however this is depending on age. I’m 30 and my partner 31 and the max we got offered was 38years.
 
lozzapaloozza said:
Me again, newbie 👋🏻

Re mortgage repayment periods, what’s the maximum number of years you can do it over? Does it differ depending on age? (There’s 12 years between my boyfriend and I so would it make a difference?) Apologies if that makes no sense and I look like a twat 🤪
Click to expand...
My husband is older than me and we've ended up with me as the sole owner as when my husband was included as a potential borrower it reduced the term we could borrow over from the 33 years I was offered to just 20 for us both, which would have meant mortgage payments that were roughly twice what we pay now.

As I could pass all of the affordability tests by myself we went down that route, rather than try and make the underwriters see that it made more sense to have two potential borrowers to enforce against rather than just one in the event of a default (particularly as I could afford it alone so adding him would seem to have only been an upside for our lender but *shrug*). However, we're married so the position is slightly different.
 
lozzapaloozza said:
Me again, newbie 👋🏻

Re mortgage repayment periods, what’s the maximum number of years you can do it over? Does it differ depending on age? (There’s 12 years between my boyfriend and I so would it make a difference?) Apologies if that makes no sense and I look like a twat 🤪
Click to expand...
I was 40 and my husband 43 at the time we got our mortgage and we have a 25 year repayment. If we weren’t such late starters 👵, we could have for a longer term.
 
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