Nanny bans mortgages of more than 3 x income

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/4995778/FSA-to-cap-mortgage-borrowing.html
So is nanny going to cap the average house price also? An average salary
(£20k?) won't get you much, even with the crunch...
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On Mon, 16 Mar 2009 18:04:23 +0000, Maria

just more 'new' labour economic illiteracy....
people cannot buy an asset for what they believe it is worth to them
of course it will force house prices down, thereby undermining personal wealth...in a sane world 'new' labour would be liable for the losses.... they could always replace the losses with still more tax...
regards
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At 18:33:33 on 16/03/2009, count 2 delighted uk.finance by announcing:

Look at the population density.
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That's right, after all, we're are the 49th least populated country in the World.
New Labour took one look at the benefits to be had from inward migration and thought, “We’ll have some of that” whilst at the same time turning the deaf ear towards all the downside.
The choice is simple if you want population to grow to 60 million (though since the economic downturn that may be unlikely indeed people can’t get out fast enough) you have to free up the land and stop pretending we can hold on to Jerusalem.
House prices in the UK always have been just one stroke of a planner’s pen away from a crash but Brown saw to it that even that wasn’t necessary.
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The population hasn't really grown that much (it's grown about 0.5% pa since 2001), the rise in demand has mostly been fed by idiots buying second homes, and other idiots buying much bigger houses than they really need because they reckoned it was a no-brainer good investment.
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On Mon, 16 Mar 2009 18:45:22 +0000, Alex wrote:

Something needs to be done about irresponsible lending and that is a start. Once no one can afford what's for sale then the prices will have to come down or no one can move. They could stay put I suppose - cutting of their noses to spite someone else - that right could never be removed (one hopes).
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On Wed, 18 Mar 2009 10:53:27 +0000 (UTC), Dead Paul wrote:

Hopefully this is pretty obvious: banks only make profits from loans - not from savings. As you increase the pressure on an institution to make more profits, they are driven down the road of making more loans.
Now, there are only so many sensible, prudent, responsible people out there. Once they have had their fill of loans (and have, themselves, come to the realisation that they shouldn't take on any more debt), how can a bank increase its profits - as its shareholders demand? The only way is to expand their reach, and start lending to people who wouldn't normally be eligible (or who hadn't considered the possibility) for a loan.
What's the solution? Well, one way would be for the people who deposit money to be lent out, to have some say in the lending policy: i.e. who gets to borrow _their_ cash. This is effectively what building societies are. The problem is that during the 90's a lot of BS's converted into banks - and made large "windfall" profits for their previous owners - the depositors. In some cases, it was the savers themselves who pressurised the BSs to convert.
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On Wed, 18 Mar 2009 12:59:41 +0000, pete wrote:

That's another flaw in modern society. Everyone and everything has to improve on the previous years profits. What for? If they are paying off what they need to pay off and they have enough to pay employees and to keep the business going why make more profit year on year? Because everyone else is and they'd go under as they were outpaced as a business? There's no need for it if most of them stopped that madness.
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At 18:04:23 on 16/03/2009, Maria delighted uk.finance by announcing:

And the higher you earn, the higher multiple of salary you can actually afford in any case.
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Alex wrote:

If the government wasn't so Obamaesquely concerned about the welfare of idiots and institutions who borrowed/lent more than they can afford, they wouldn't be doing this IMHO. It really is pure nannyism. How long before they are telling banks how much they can lend to businesses?
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On Mon, 16 Mar 2009 11:33:33 -0700 (PDT), count 2

the uk is allegedly short of houses...the usa has a surplus...
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'Maria' wrote this:

Yes, that's going to be a problem. But I guess it would provide Brown with the excuse to reinvent council housing. Just think of it ...all those nice new council estates, with homes allocated to people who are carefully vetted and approved Labour voters!
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aracari wrote:

Don't...I'll throw my dinner. Just imagine how people could be manoeuvred around the country to all those 'underpopulated' areas if more people were dependent on council housing.
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'Maria' wrote this:

lol. I hope they'll be obliged to use a good state run removal company!
How about "Brown & Co"?
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Average salary is about 25,000 these days.
You can buy a house for 75,000 in most cities at the moment.
What he's doing is trying to make people save up their deposit.
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William Black

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William Black wrote:

Hull maybe. Even here you will be hard pushed to get anything for that and this is a traditionally cheap area. Also it does not take into account the huge number of people who don't earn anything near the average wage (i.e. almost everyone I know). I wonder if they will still take joint incomes? Even modest ex-council houses in my home town (St Albans) will have to be bought by very wealthy people, or the owners simply won't sell if they can't buy another.

He's done that on top of the cap AFAIK.
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I thought that until I went into an estate agents last week.
You can buy a house in expensive Scarborough for 75,000 when 12 months ago you couldn't get anything for less than 100,000.
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Two gardens, three bedrooms; attractive driveway; this house is packed with stunning features and is a bargain for 29,950
http://www.rightmove.co.uk/property-for-sale/property-20195887.html/svr/2004
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DVH wrote:

Lovely! For 'substantial refurbishment' read giant retention - whoever buys that is going to need a £20k deposit!
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'DVH' wrote this:

"but does require substantial refurbishment to bring it up to modern day standards."
IOW it's like a tip inside and everything's smashed to bits.
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