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.

SO just means you are still renting, but having to pay for the repairs that the landlord would normally have to stump up for, it is a rip off.

The landlord has to contribute to essential repairs for the first 10 years now (and there really shouldn't be anything major in a new build).

Taken from BBC website today. A strong indication that the BoE will keep the base rate at 5.25% at their next meeting on December 14th.

Uk inflation falls sharply in October to its lowest rate in two years, largely due to lower energy prices.

Inflation dropped to 4.6%, down from 6.7% the month before.

The figure means a government target to halve inflation by the end of the year has been met early. But there is a limit to how much credit ministers can take for the fall as energy prices settle.

https://www.bbc.co.uk/news/business-67412740

This will no doubt intensify the mortgage rates war. Hopefully some really great rates are on the horizon.

I'm hoping my lender reduces their rates now. Waiting until the next meeting will (hopefully) be too late for us, as we want to complete before then! I'm optimistic they may drop another 0.2-0.3%.

Living in London it seems to be a more appropriate route, if I was elsewhere I wouldn't do it

You probably wouldn't need to do it elsewhere @MotherOfRatios - London is just so ridiculously expensive isn't it?

According to this article in the Telegraph, following the cut in the CPI to 4.6%, "money markets are pricing in that interest rates will be cut by a quarter of a percentage point by June at the latest".

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, went further when he said that the Bank of England will be able to cut interest rates from 5.25% to 5% by May next year.

https://www.telegraph.co.uk/business/2023/11/15/ftse-100-markets-news-latest-ons-inflation-live-sunak/

It is, I wish they'd open S/O up to all properties and not just newbuilds

That's like wishing for prices to stay higher for longer. It'd be like rocket fuel to an already out of control market. Far better for prices to fall so that SO is not needed.

Do SO if you feel you must but please be aware of all of the regretful SO'er's out there and their stories.

Their contribution is limited to a maximum of £500 per year? And have you not seen any of the snagging videos showing how bad new builds often are? Did I hear about balconies falling off new builds in East London?

Wtf?!

https://www.standard.co.uk/news/london/barking-apartment-balcony-collapse-gascoigne-estate-b1119958.html

@XVGN good lord. Thanks for the link.

The other day I learned we have had 16 housing ministers in 13 years. No wonder nothing good ever gets done.

There is definitely some issues, but I have no other option other than to do shared ownership as I cannot continue renting and I can't move out of London

The thing is that 6% mortgage rates were not the end of the world when property prices in most parts of the country were 3 times average incomes and often based on 1 income or 1 income plus a bit of part time . That's not the case now apart from the very cheapest areas and are often based on 4 dual incomes.

I paid 12% at one time in the late 80s if I remember correctly , but on a house that cost £48,000 in a cheapish town and our joint incomes were £31,000

It's a very big difference.

And that comes under the new build guarantee, obviously. You're clutching at straws if you think that would be something the homeowner / landlord would pay for.

@MotherOfRatios there are a few companies out there doing this - Heylo is one (but you need to be able to put down 20% in cash) way home are another -

Often they have price level restrictions though so it's next to useless if buying in not a cheap area.

Tony Blair brought in a scheme like this called DIYSO - we bought our first flat on it in Crouch End- the problem was it was too popular- and the builders didn't like it!! So it stopped after a bought 18 months- but it was a very forward thinking concept

It's not that you have to pay for the repairs of the new build, but if it's built so shoddily that a balcony falls off would you really want to own it?

I rented a new build in London for a year and within months the water from the bathroom was leaking through the spotlights in the hall below. We move out before it was ever fixed, even though 2 plumbers came to have a look. I would not wish to own that horror house.

Then that's a general new build issue, not an issue specific to shared ownership, which is what the conversation is about.

Developments will be a mix of SO and fully-owned / mortgaged, so if the build is that shoddy for the SO properties, it will be for the others too.

It won't be the same. SO'ers won't be as free as 100% owners to move on and out in the event of a bad choice. And typically SO'ers are less financially secure to start with and thus less resilient to issues.

You're moving the goalposts again. That is yet another, different, issue!

And I'm not sure I agree about the non-SO owners being generally more financially resilient, especially right now. Surely you've seen many threads about people who can't afford the general living increases along with their increased mortgage payments?

At least SO owners can get UC towards their rent element, which full owners can't get.

But @NoWordForFluffy the SO-owners are far more restricted about where they can buy and so can't be picky. I'm willing to wager that people who can buy anything they want won't go for shoddy new builds that are 10-15% more expensive than older housing stock. SO drives up prices because people get "free" loans to overborrow. No one in their right mind would chose to buy this kinda rubbish.

Free loans for SO? What are they then?

Bit weird that people DO buy new builds on the same estates, given your assertion that nobody wants them. How are house builders still in business? 🤔🤔