Sunak says no extra help with mortgages as fixed rates climb to 6%
Sunak says no extra help with mortgages as fixed rates climb to 6%
Prime minister says no new support available for households struggling to pay loans
If they started offering help it would undermine the BoE's strategy and likely open up a can of worms. I say this as someone having bought a property in 2021 and remortgaging this year.
The BoE have one lever they can pull and it's labelled "interest rates go up".
Edit: tbh, I'm more concerned with the housing market crashing due to the high interest rates making ownership at the current prices unaffordable. I suspect when we remortgage again we'll be paying the same amount of interest or higher due to being moved an LTV banding, which will be depressing.
Inflation is helping house prices a lot at the moment. I think we will see a modest drop in prices around 10% in total but which will amount to 25-30% in real terms due to inflation. Hard to see drops much greater than that happening due to the supply constraints making rental costs also very high.
There's been a thousand predictions of house prices falling over the past decade for a hundred reasons, and every single one falls over the fact we have a drastic shortage of housing and no credible plan to increase the speed we build them.
25-30% in real terms is pure fantasy pulled from your arse and it'll never happen, not even close. Does Lemmy have a remindme bot so I can come back in 6/12 months and point this out?
I'm not surprised, given the sheer amount of money that it'd take to achieve, and this .gov has splashed so much cash already with the energy price guarantee. But it does mean rocky times ahead for an awful lot of people, I cannot imagine the voters will thank them.
They're gonna get crucified at GE.
Food costs creep up, you notice the cost has gone up bit by bit and maybe your butter costs 50p more, you grumble and you put it in your basket anyway. Rice has gone up 35p but you use it often so you grab a packet anyway, 35p is annoying but it's only 35p.
Mortgage? For most people that goes up in one big bang from a 2% fix to a 5.5%. You're now paying £200+/month more and there's nothing you can do about it. Worse yet, you either fix and possibly fuck yourself over if rates start dropping or go variable hoping rates decrease sooner than later but stomach any increases before they do.
Yeah, Tories never deserved their "good with money and the economy" reputation, but they're killing it themselves anyway.
Help for mortgages would defeat a large part of the mechanism being used to deal with inflation. If the market expected there to be a realistic chance of this happening then interest rate expectations would go up even more and mortgage costs go up even more. Gove was an idiot to suggest they were looking at it. Or he didn’t particularly care beyond his own interests and popularity.
Except the mechanism for controlling current inflation is badly placed. The reason we have inflation so high in the UK is down to supply issues and energy bills. Economists have been shouting this for over a year now. Increasing interest rates is not going to solve that. The government knows this. They are doing nothing to alleviate the issue. Energy firms are still evading any windfall levies, and our port are about to becomes more constricted when they introduce actual border checks at the end of Q3.
how awfully unconservative. !
it's an interesting one - i thought they might do something. free money for homeowners which inturn goes straight to the bank is exactly the kind of this government does. it would also 'support' a bunch of speculators who are about to bite the dust.
if we could weather a sharp down turn, it would help cull the greedy.