6% mortgage rates; trouble a'ht Mill

[Twiglets1]

This is a new 6% mortgage rates thread as the last one is almost full.

Thanks to KievLoverTwo for suggesting the second part of the title to reflect all the squabbling these threads are causing. Which could be a thing of the past of course. But realistically, it won't be.

That is a very skewed attitude to risk. When has the value of property ever moved to zero due to adverse markets in the Uk?

In property crashes property doesnt "technically" lose value, it just loses value and you still have the debt to pay, most people who have lived through that will tell you that it is not a nice experience, many people who borrowed to buy in the last few years will now be in very tricky situations with their property debt, I get the point that if someone needed a house five or ten years ago and didnt want to rent they had to borrow mortgage debt or pay cash, but what I am saying is it is time to stop cheerleading the Mortgage debt is Good Debt nonsense, it is over, the property Ponzi has burst, let it go and stop telling people about "experts" (who work for mortgage banks) lying about "six rate cuts" and other made up mortgage sales B.S. Rant Over.

If something isn’t for sale then the fact that it has risen or fallen in value is neither here nor there. I’ve lived through a property crash - a real one not like this current mild house price correction & of course it’s not nice for anyone forced to sell. But the vast majority of people don’t have to sell. They choose to sell to move to a different property and actually a depressed market is better for moving up the property ladder to somewhere better you couldn’t otherwise afford.

The risk is in the leverage, not the value going to zero, there are a LOT of very leveraged people to get us to a property bubble this size, and of course the value isn`t going to zero (unless you are on top of a chemical dump or something) but if you look at the bloodbath in CRE we can see the danger of saying "Oh, my property/office block/BTL will never drop to X value". Very scary times, especially if you are highly leveraged.

This crash hasn`t started yet, you have never lived through the bursting of a credit bubble this size, no one has, it is historically unique in the levels of debt that individuals have taken on.

I think you have a theory and are hoping to be proved right. I don’t think you have clear understanding of the market and economy and are drawing conclusions from that. Of course if someone has almost no equity and huge debt they are at more risk from market movements than somebody less leveraged. We saw that in the 80s/90s with 100% interest only mortgages, lax lending, mis-sold endowments etc. But that has little to do with average homeowner’s position today. 100% mortgages and interest only mortgages have not been available for decades, affordability checks likewise have been in place for many years etc.

Oh dear, you’ve been predicting a crash for so many years and it still hasn’t even started yet? Don’t you get that lenders are more not less careful who they lend to these days and the checks into affordability are more thorough than they have ever been? I agree people take on scary levels of debt to buy a property but they always did and mortgages used to be far less regulated.

The crash is always just around the corner for you isn’t it.

And you do have a clear understanding of the market and economy? From what you posted there I am going to conclude that you don`t.

Can we agree that there are not going to be six rate cuts this year?

Yes.
Can we also agree that there will be some rare cuts this year like maybe 3?

In fact HPC fans would LOVE for there to be six rate cuts, because that would be the sign that an absolute mind-bender of a recession was here and UK property would be absolute toast in that scenario at this stage in a debt bubble.

No, I think the FED are going to hike again.

Unfortunately that will just be one more disappointment for those guys

Are you predicted NO BoE rate cuts this year?
( wish so much we could actually have a bet on it)

I think they are quite happy with things as they are TBH, 5%+ rates are doing their work on the property bubble already without a recession.

I am predicting a FED hike or hikes, and the BOE doing what they usually do - following the FED while talking a load of shite about the economy and getting all their predictions wrong.

Ah come on they must be a bit disappointed. Predicted Armageddon and got instead a mild house price correction to pre Covid prices.

Still, worse times are just round the corner, right? Always a comforting thought.

Anyway, back to mortgage rates. Sky News Money Blog.

"NatWest has told brokers it will increase mortgage rates on Friday, the Money blog can reveal - after a similar announcement from HSBC earlier today.

NatWest has just told brokers it will also be increasing mortgage rates tomorrow, the Money blog can reveal following on from HSBC's announcement (see 12.05pm post).

New customers will see hikes of between 0.10 and 0.15 percentage points while for existing customers it's between 0.15 and 0.20.These are on two and five-year fixed deals.Speaking to Newspage, Justin Moy, managing director at EHF Mortgages, said: "Today, yet another major high street lender has pushed rates further out of reach of borrowers. "NatWest may be following the rest of the mainstream lenders but the collective reaction from lenders to higher swap rates will inevitably kill off all those improvements everyone worked hard for in January this year.

"Right now, it feels like 2023 is happening all over again. Someone has pressed the mortgage rewind button."

Santander, Coventry and TSB have all raised rates this week - though today Halifax went against the grain and announced some cuts from Friday. It's not clear by how much.

As discussed earlier, swap rates - which dictate how much it costs to offer mortgages - have been creeping up, and lenders are passing this on.

There is a feeling markets may have got carried away with expectations of an early base rate cut this year - leading mortgage rates to fall. What seems to be happening now is a readjustment, with forecasts for a base rate cut having shifted back from May to June."

https://news.sky.com/story/mortgage-rates-inflation-energy-price-cap-bills-latest-sky-news-money-blog-13040934

"New customers will see hikes of between 0.10 and 0.15 percentage points while for existing customers it's between 0.15 and 0.20.These are on two and five-year fixed deals.Speaking to Newspage, Justin Moy, managing director at EHF Mortgages, said: "Today, yet another major high street lender has pushed rates further out of reach of borrowers. "NatWest may be following the rest of the mainstream lenders but the collective reaction from lenders to higher swap rates will inevitably kill off all those improvements everyone worked hard for in January this year."

Ok, I'm not sure what Justin's qualifications are. For remortgaging, the new rates will still be lower than SVR's, so NOT out of reach. And for new mortgages, the buyer simply negotiates the home price down to account for the increased rates. It really isn't rocket science.

EHF Mortgages is a mortgage broker. I bet Justin's firm is finding that people are being put off taking out mortgages by the current rates, affecting his business.

Well a nice HPC would be better times, much better, the only people who don`t get that are the people who believed all the banker talk about the "ladder" etc, it is a ladder yes, a debt ladder, and there is a fat banker at the top laughing at you if you over-borrowed.

"Today, yet another major high street lender has pushed rates further out of reach of borrowers. "

LOL, I can`t believe people still write this drivel, let alone read it or believe it, house prices will just have to come down to make up the difference, no biggie. Obviously the clowns writing this stuff are heavily into property at peak prices or lending on property at zero rates?

@CrashyTime do you intend to buy a property?

I think I have enough already TBH.

Enough properties? @CrashyTime