I read today that there is a huge rise in the number of people unable to cope with their Mortgage payments.
For those like myself who remember double digit interest rates as the norm this seems hard to fathom. High interest rates? you must be having a laugh.
I guess what has happened is that people have got used to historically low interest rates and are stretching themselves to the limit. Unfortunately they've allowed themselves no leeway.
Part of the problem is the move towards property as an investment. We no longer view a property as solely a home. People now consider the increase of their property as if its money they own. Of course it isn't, the only time you realise that "investment" is when you downsize or move to a part of the country with cheaper house prices.
I do wonder how young people are expected to buy today. I managed to buy a one bed flat when I was 22 and I expect that a 22 year old would have very little chance in Essex today. Some of this has been due to the decision to sell off council properties. As my Dad and I said we should have bought Nan's council house, we could have sold it for a tidy profit or rented it at 3-4 times council rents. Its mental.
I have no answers, I've always taken a mixed approach to savings. I view my property as an investment in the sense that I will buy something smaller and make a profit, I invest in cash, corporate bonds and shares.
I suspect we need to build more property (where?) or put a restriction or the number of properties you can own. Abandon the 50% rebate on ctax on holiday homes?
I see the great British Public, who object strongly to the nanny state are back, are demanding their Nanny!!
I have immense sympathy with someone who has been flooded (it must be horrible) but not when they say I should pay becuase they have no insurance. And lets be fair we would pay for it out of taxes.
Now if you can't get insurance I have some sympathy with your position but if you can then uh, how do I put this, tough. Did you have a holiday? Run a car? Smoke? buy Lottery tickets? Insurance is not a luxury its a necessity. Your house is your single most important item.
and may I point you at this excellent blog by the excellent Beki
4 comments:
Heil, Peter! ( I do agree with you, though maybe not quite so forcefully)
I agree with you Pete. It's much the same all over I would think. I'm thankful that I bought my property and house outright so never had a mortgage. I know of lots of people who have two cars, huge houses, all the toys, bells and whistles and are scraping around for money at the end of the month. I don't think the credit card thing helps either unless used wisely. It's not like taking money out of the bank and paying for things right away, is it! I've never had a credit card and still don't see a need for one. I always felt, if you don't have the money, you don't buy it. Of course, I'm not talking about a mortgage on a home. I guess I'm old fashioned.
CP - its not heil Peter. I feel for people who have been flooded but some of them have taken responsibility for their lives and I don't see why i should subsidise those who haven't
Again with mortgages its what you can afford. My parents only bought what they could afford. I may have mentioned before my parents when buying there house couldn't afford a phone at first so went with out it was priorities.
Interest rates were 15% when I took out my first mortgage in 1990! And I could only afford a tiny flat then. Nowadays people buy 3 bed semis as starter homes - then complain about the mortgage. There speaks grandma!
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