to want to literally throttle people saying "5% is nothing, interest rates used to be 13%" etc etc

[XCTX]

Yes, yes they did. But there is NO context here and also no comparison

interest rates were 13% at a time when the average house price was 60k and cost 4.5x the average salary.

The average house price is now 284k or so, and is c.7.6x the average salary.

People are coming off fixes and suddenly seeing their mortgages increase by 40, 50% and it is infuriating me that some are minimising this problem by comparing one finite moment in time with no context.

Agreed. Though I would add that the huge difference was the salary to lending amount, or whatever it was called (sorry, I'm useless at technical terms). It used to be the maximum you could borrow was 3 times your salary, if I remember correctly, so you started off from a marginally better place than today. But on the other hand, annual salary increases to keep pace with the cost of living and inflation were usual, and there was also MIRAS, which was a great help.

Same its how they translate to mortgage rates thats not understood our mortgage payment are going up £400 a month that's with a rate of 3.49% if we leave it until next year to refine it could be £700 people are going to lose their homes

YANBU!

So infuriating

Shut up, it's not helping!

As it happens I was out with a group of people in our 50s at the weekend. Most of us bought our first houses in the 80s/90s weathered the storm with varying degrees of success and are doing OK now with mortgages paid or nearly paid and fairly comfortable retirements in prospect.

No one was feeling smug though. Fortunate yes, but the overwhelming discussion was that we are really quite scared about what's to come, even though we personally should be in good positions. (Or at least better than many).

Make no mistake it was a storm, I know loads of people who lost their homes and many more who sold for less than they paid to avoid being repossessed. No one I know thinks today's young people are "lucky" though.

Our mortgage is paid off, the house cost £178,000 now worth £325,000 - but it's meaningless because we're always going to need a house to live in. If we sold and bought something else that house would also have gone up just as much so we'd be no better off.

I'd love to see house price go down hugely for the sake of my kids, I'd be very happy for my house to be worth what it was when i bought it.

Most of us have huge empathy and would do anything we could to make things easier for the next generations

This. Every generation has it hard when starting out but this young generation particularly. I feel desperately sorry for them, some of them are struggling just as much as we ever did.

Then you say
"We know how this feels and sympathise" not "well we had it even higher so stop whining". Would be totally different reactions

Sad to see so much hate between the generations, when the greater issue is how the government is getting away with impoverishing the majority.

People who say this are airheads with little understanding of inflation, the value of commodities over time and general economics.

And are usually the sort of people who say "young people could afford to buy a house if they cut down on starbucks and iphones!"

Was your post aimed at me @InCheesusWeTrust ? I'm confused? I thought my original post was empathetic and understanding.

However, I'm having a particularly shitty day today, so maybe I'm being over sensitive.

I'm sure that most of us have our own struggles at the moment, and the world doesn't feel calm and safe. Best wishes to all. Genuinely.

And on top of that the weird narrative that people who are most stretched by their mortgage repayments already are feckless and greedy, buying a bigger/nicer property than they can afford - rather than young and buying the only property they can afford!

Infuriating!!

I guess the sellers with their vast equity are not greedy but worked really hard 🙄

Also people aren't comparing like for like. FTBs are much older now so there's less time to ride out the bad times.

Sorry. Didn't mean you personally. Should have put "they"

This is not criticism - I understand your perspective and don't entirely disagree, but what would you want for the generation of young families who have had no choice but to buy at 6x or even 10x salaries, but also to pay for childcare, support older parents and all of the other financial pressures now on us?

If your house was worth £178,000, what would happen to all of those families who would be unable even to remortgage because they were in negative equity? We are talking about millions of people, while house building would stop altogether.

We have come too far. Static house prices in a growing economy are the only best outcome that could be hoped for.

And it's their fault for "not pressure testing up to 10%"

Which maybe they did but they didn't factor in paying so much more for energy, petrol and food.

@Ariela you are right it is all relative. It's relative to the cost of houses compared to salaries. People can't buy houses now at 3 x a single salary, it's 4-5 x a joint salary and that's after having to save 10% of the purchase price. Salaries haven't kept in line with house prices. That is a fact. Housing used to be much more affordable.

The only people who can't understand why people are so worried must be those who either weren't affected by or don't remember what happened to property prices and interest rates in the late 80's and 1990.

Property prices rose very sharply in the late 80's, interest rates peaked at 15.4% to control inflation. Even at lower income multiples people lost their homes because they couldn't pay their mortgage and after the property bubble burst and house prices crashed there were lots of people stuck paying mortgages on houses not worth what they paid for them and they couldn't afford to move for years.

I've watched banks lending higher income multiples because of historically low interest rates for years with real concern. So many people had their homes repossessed in 1990, it was fucking awful. Even a relatively small interest rate rise is going to cause big increases in mortgage payments.

It was very tough for people then and it will be very tough for people now.

I do obviously think you have a point, but I also think that Ariela sums up succinctly how times were very different.

I have great sympathy for the young having been able to buy my first flat with 3 times my salary plus a deposit. Also requiring a lodger to help fund this.

But the unavoidable truth is that interest rates have been held artificially low (the lowest for 300 years which tells you something) due to the financial crisis of 2008. Interest rates of 4 or 5% are quite average historically over time though they have been much higher.

The BoE should have gradually moved interest rates higher which they were doing anyway and this was long overdue. Obviously at 0.25% shifts this is much, much different to what the awful situation is currently looking like. But this would still in time have given interest rates of say 3 to 4%.

The problem is that many with mortgages since 2008 have never experienced interest rates nearer the norm and have incorrectly assumed that the rates of 1 - 2% are normal which they are not. These were temporary measures, with quantitative easing etc that held them artificially for such a long period of time. They were always going to increase as artificial rates not seen for 300 years were unsustainable in the long run.

When we got mortgages initially we had stress tests to see if we could afford them at 10% (which was my first mortgage) upwards. Surely brokers and banks have still been doing stress testing and explaining that mortgage interest rates will rise from those unseen in history before?

But I do sympathise as said earlier as the multiples are high.

not too mention the decades of wage stagnation those newer homebuyers have experienced

But the unavoidable truth is that interest rates have been held artificially low (the lowest for 300 years which tells you something) due to the financial crisis of 2008.

But why have we had emergency rates for nearly 14 yrs

It's very sad to see generations turning on each other rather than focusing on who is to blame for this crisis. The 'we had it worse' narrative is a lucky distraction for a government whose piss poor economic and fiscal policies have put us into this position without caring for one moment how ordinary people will be affected. Yes, some of these issues are global but cutting taxes for the wealthy, cutting public services and benefits (bound to come) and a totally uncosted plan has made the situation much worse.

I know it's irritating when the older generation seem to make sweeping comments but their fear was very real too back in the 80s and 90s - repossession was really common. No doubt their parents seemed uncaring too (we were told 'it's your own fault for buying a house. Ideas above your station. Should have rented like us')

The problem is that many with mortgages since 2008 have never experienced interest rates nearer the norm and have incorrectly assumed that the rates of 1 - 2% are normal which they are not.

who assumed it was normal though? Many people just want secure housing

YANBU It was at that time my family home was repossessed and it was really awful. So there's that. Not exactly something to aspire to.