House Buying In The UK.

[padi56]

This is just absolutely bloody staggering:

Quote:
Abbey, Britain's second largest home loan provider, is offering borrowers five times their salary in order to help them get onto the property ladder.

The bank is making the offer available to individuals or couples with a 25% deposit for their house and an annual income of £50,000 or more.

Idiots. So if you earn £50k per annum you can get a £250k mortgage.

Now Lets analyse this.

At £50k, a single person will take home approximately £2,850 and a couple between them some £3,000. So the mortgage will gobble up about half their take home pay - assuming they don't pay in to company pension schemes, which could take £200 off the total if they pay in at 5%.

On £250,000 a 0.25% increase in interest rates adds £50 a month to repayments (0.25% being widely expected this side of Christmas) and a 1% hike (not inconceivable when a plethora of the so called green taxes hit the RPI figures) adds a whopping £200 a month.

Add to this council tax expected hike of £150-£250 WTFF together with insurance, car running costs, repairs,more bloody tax on heating bills etc etc and the poor buggers are going to be left living on bread and dripping.

This is before anyone gets up the duff or perhaps gets relocated or any other little hiccough along the way.

So why the offer?

Telegraph wrote:
With house prices rising in the UK, and the market going that way, people are having to borrow more to be able to afford a home,’’ an Abbey spokesman said last night


Well no bloody surprises there then - if the lenders didn't keep lifting the barriers to bigger and bigger loans, the market would have to slow down purely because no one could bloody raise the money to buy a bloody house in the first place.

This is bleeding lunacy.

And how are the sly greedy b@st@rds hedging their bets?

Quote:
The bank is making the offer available to individuals or couples with a 25% deposit.


Lovely - a nice 25% cushion for the lender, in case they need to go on the inevitable repo trail. So Mr & Ms Desperate save, borrow or steal a total of nearly £90k, to fund the deposit, stamp duty and costs and during their struggling early days the Abbey is sitting smug knowing that they're protected even if prices fall by a quarter.

This is FA to do with getting people on the property ladder. It's all about making money,Secured loans.....the banks are in a win, win situation,as always.

[mailman]

Another case of greed here Peter. That combined with people living beyond their means makes for makes for a rich bank president.

[padi56]

Originally Posted by mailman

Another case of greed here Peter. That combined with people living beyond their means makes for makes for a rich bank president.

In some ways yes Paulie but today in and around London anyone wanting to start on the property ladder.They start from around £300,000 ($572,412 for a quite small terraced house,£400,000 ($763,111) would perhaps get you a small semi or detached house.Then if you could afford the mortgage and council tax and then living with quite basic costs etc, it still would be a big struggle to most.

[BruceS]

It would be nice to buy another house. At least then we wouldn't have to worry about the landlord kicking us out (although we won't have that prob with this one). From what I understand, though, there are no tax credits in the UK for home ownership. I'd rather rent and have more money to enjoy life.

[padi56]

Originally Posted by BruceS

It would be nice to buy another house. At least then we wouldn't have to worry about the landlord kicking us out (although we won't have that prob with this one). From what I understand, though, there are no tax credits in the UK for home ownership. I'd rather rent and have more money to enjoy life.

Well Bruce like everything renting got its advantages and disadvantages But have a check on property value around your area, and then a bit closer to the sea.Myself feel quite sorry for folks today,trying to start out on the first rung of the property ladder in the UK.Myself missed a golden opportunity to move to Spain a few years ago.Both Carols Mother and my Mother was alive then, thats the only thing that stopped us.Now looking back it was a real big mistake not to get out of the UK,and start a new life in Spain.

[mailman]

Originally Posted by padi56

In some ways yes Paulie but today in and around London anyone wanting to start on the property ladder.They start from around £300,000 ($572,412 for a quite small terraced house,£400,000 ($763,111) would perhaps get you a small semi or detached house.Then if you could afford the mortgage and council tax and then living with quite basic costs etc, it still would be a big struggle to most.

Damn that's alot of money to get your feet wet in owning a home

[Otis]

Originally Posted by mailman

Damn that's alot of money to get your feet wet in owning a home

Yep.

It's one of the things that, I'm not ashamed to admit, scares me.
Over here they're advertising things like "own a home with only a $2,000 deposit" - not on your bloody life I say, that's just way to much of a devil's handshake. I don't care how little I ever earn, I don't want to get into that much debt...... yet