"I'll make capitalism work for the people"-What Ed Milipede wants.

[Yorkshire Blue]

I can assure you, people do moan about mortgages!

It was spending that got us into this mess in the first place. Firstly, with the prime mortgage crisis (people borrowing more than they could afford) and then public sector borrowing spiralling out of control.

What's needed is a balance between spending and saving. At the moment the inbalance is that more spending is required, but any spending needs to be based upon savings. Banks get their money to lend out from savings.

Perhaps then, banks should be forced(by legislation if necessary) to lend a certain amount or percentage of their income from savings, to individuals requiring a mortagage or entrepreuners wishing to start or consolidate a business rather than just hanging onto the dosh, which is what they're doing at the moment?

Hang on, didn't you blame the evil banks (boo, hiss) for their reckless lending for starting the whole crisis?

They've reacted by being more circumspect in who they lend money to and how much they lend, and now you're criticising them for this as well. They really can't win.

With regards mortgages, someone on £200k pa will have no problem in getting a £500k mortgage on a £1m home. Where people are going to struggle to get the banks lending to them is when they are on £20k pa and wanting to borrow £250k on a £250k home. So it's not that banks are unwilling to lend money, it's that they are unwilling to lend money to businesses or individuals that they see as too risky.

 

[osymandus]

Hang on, didn't you blame the evil banks (boo, hiss) for their reckless lending for starting the whole crisis?

They've reacted by being more circumspect in who they lend money to and how much they lend, and now you're criticising them for this as well. They really can't win.

With regards mortgages, someone on £200k pa will have no problem in getting a £500k mortgage on a £1m home. Where people are going to struggle to get the banks lending to them is when they are on £20k pa and wanting to borrow £250k on a £250k home. So it's not that banks are unwilling to lend money, it's that they are unwilling to lend money to businesses or individuals that they see as too risky.

However prior to all this they helped create teh enviroment where silly mortgages we're given to any one and loans who culdn't afford it bringing us to this mess.
Its like the idea that religions cause all wars , all bankers/banks capitalist are evil . Its rubbish we have idiots , opportunist schemers cheaters and down right brilliant people who care and know where their money and products come from in every walk and way of life . Its not the method that has lead us to this point but individuals using it .

 

[Neil_F]

Banks are having to move in opposite directions simultaneously. They are told that they need to rebuild their balance sheets and hold higher capital ratios. This is even tested and the results published e.g. the EU stress test.

At the same time their balance sheets are taxed (the banking levy), which weaken the financial position. They are also admonished for adopting a conservative lending approach, but that is the consequence of rebuilding balance sheets

 

[Tangled up in Blue]

Banks are having to move in opposite directions simultaneously. They are told that they need to rebuild their balance sheets and hold higher capital ratios. This is even tested and the results published e.g. the EU stress test.

At the same time their balance sheets are taxed (the banking levy), which weaken the financial position. They are also admonished for adopting a conservative lending approach, but that is the consequence of rebuilding balance sheets

How will the banks NOT lending money make capitalism work?

 

[brigadista]

It depends. If the consumer debt is spent on things which in turn, kickstarts the economy, which means consumers get a higher salary, and can pay off the debt quicker...it's a win-win

Mortgages are debts. No-one moans about them.

Saving is all well and good, but it's spending which this economy needs right now...

here's a moan about mortgages, does it not make anyone else sick when they read the "key facts and statements" and it says that the borrower (YOU) will have to repay somewhere between £2 and £3 (depending on the rate at the time) for every £1 you borrow?! now that is the worst deal ever. If money sharks operated in your neighbourhood you'd be outraged, but because the banks are so respectable nobody bats an eyelid!

the reason the housing stock was decimated by the tories and sub prime was so popular is because home ownership is the trick that lines their pockets and we all slog our guts out all day every day struggling to pay back 2 - 3 times what we borrowed :darkcloud:

 

[steveo]

here's a moan about mortgages, does it not make anyone else sick when they read the "key facts and statements" and it says that the borrower (YOU) will have to repay somewhere between £2 and £3 (depending on the rate at the time) for every £1 you borrow?! now that is the worst deal ever. If money sharks operated in your neighbourhood you'd be outraged, but because the banks are so respectable nobody bats an eyelid!

the reason the housing stock was decimated by the tories and sub prime was so popular is because home ownership is the trick that lines their pockets and we all slog our guts out all day every day struggling to pay back 2 - 3 times what we borrowed :darkcloud:

No one is forcing you to borrow anything. If you dont borrow it you dont need to moan about it.

 

[osymandus]

No one is forcing you to borrow anything. If you dont borrow it you dont need to moan about it.

Your correct , however as our economy is consumer based driven and everyone is encouraged to buy buy buy , there are preassure's that people give into (sellers , producers wants you to please thanks buy your new mobile phone ob average every year , new car ? DFS sale ).

Its a responsibility on both sides , do we go back to the days of buying saving up to buy well crafted funiture that lasts a life tiem and is handed down to grand kids or is this social irresponisble due to its affect on jobs , but what about the resources used to make your flat packs from IKEA et al ?

 

[Hotman]

You could always rent if you don't like paying interest, or save up and buy a place outright.

 

[osymandus]

You could always rent if you don't like paying interest, or save up and buy a place outright.

Personally i agree that more people should rent , but that same and another part of the. the idea of home owning has been thrust upon as being a great achievement, where by it should be seen as an option. Epically now the rise more singletons .

 

[Hotman]

Personally i agree that more people should rent , but that same and another part of the. the idea of home owning has been thrust upon as being a great achievement, where by it should be seen as an option. Epically now the rise more singletons .

Finally we agree :clap: more desire to rent will increase rents, and hence my yields

 

[Tangled up in Blue]

You could always rent if you don't like paying interest, or save up and buy a place outright.

That's what my wife and I did here in Spain back in 1987.
Incidentally, I notice the average age of a first time home buyer in the UK is now 37,which is not far off the age I was then.

 

[Yorkshire Blue]

Personally i agree that more people should rent , but that same and another part of the. the idea of home owning has been thrust upon as being a great achievement, where by it should be seen as an option. Epically now the rise more singletons .

Eh?

I'm confused. You don't appear to have made any spelling mistakes, yet I still can't figure out what you're saying and most disconcerting of all, MC is agreeing with you.

 

[steveo]

Personally i agree that more people should rent , but that same and another part of the. the idea of home owning has been thrust upon as being a great achievement, where by it should be seen as an option. Epically now the rise more singletons .

Surely buying outright gives people more choices as to where they want to live and what they want to do with their house, and I would have thought, more incentive to improve it.

 

[steveo]

Had you previously owned in the UK? What was the house buying experience like in Spain compared to UK?

 

[steveo]

Finally we agree :clap: more desire to rent will increase rents, and hence my yields

Mercenary, money grabbing, capitalist.
Good work.

 

[osymandus]

Surely buying outright gives people more choices as to where they want to live and what they want to do with their house, and I would have thought, more incentive to improve it.

In away no. The landlords while receiving more rent (only briefly good for MC ) will then be controlled by their tenants and the teh current legislation binding many landlords flow of market forces. More choice of rent will force landlords to make the buildings as available as possible . The buying and selling market of course would never allow it as to much revenue would lost .
you would get a market like Sweden. People don;t put as much of their money into owning or buying property . They have more free income (they just rent and change as needed ) so there for spend more on other things .

 

[osymandus]

Eh?

I'm confused. You don't appear to have made any spelling mistakes, yet I still can't figure out what you're saying and most disconcerting of all, MC is agreeing with you.

See above . Basically people pay for a dream of owning bricks and mortar . Fine if they want to many simply cant afford it . And it isnt right for everyone.

 

[steveo]

In away no. The landlords while receiving more rent (only briefly good for MC ) will then be controlled by their tenants and the teh current legislation binding many landlords flow of market forces. More choice of rent will force landlords to make the buildings as available as possible . The buying and selling market of course would never allow it as to much revenue would lost .
you would get a market like Sweden. People don;t put as much of their money into owning or buying property . They have more free income (they just rent and change as needed ) so there for spend more on other things .

But over a say 40 year period how much would you save? Bearing in mind you own nothing at the end f it.
I suppose with kids leaving home later these days, they wont be buying a house over such long period which might have a bearing

 

[Rob Noxious]

But over a say 40 year period how much would you save? Bearing in mind you own nothing at the end f it.
I suppose with kids leaving home later these days, they wont be buying a house over such long period which might have a bearing

Another thing to bear in mind is the possibility that your home might be taken into (means-tested) account to help pay for your care if you have to go into a care home. Currently, anyone else living in it has to be over 60 or have a disability for the local authority to 'disregard' the property unless you've been smart enough to hold it in trust for your kids in the first place.

 

[osymandus]

But over a say 40 year period how much would you save? Bearing in mind you own nothing at the end f it.
I suppose with kids leaving home later these days, they wont be buying a house over such long period which might have a bearing

Depends on the value of the home you want ? Also like anything in a over-flooded market teh more a product is avaliable the cheaper it becomes ;). so in the unlikley event this occurred , capital gains would lose out , inheritance tax just to start . But may pick up in VAT or otehr luxury items ? Or you put the other case into bonds (government) ?? Money and value can be moved into other area's it only loses out if not in circulation.