Nanny bans mortgages of more than 3 x income

Worked fine about 26 years ago when I bought my current house - limit of 3 times income and you needed a deposit Also meant you could cope with financial market vagaries - e.g interest rates rising to near 15%. Limit on mortgage amounts limited what could be bid for houses and meant my type of house, in a large city, cost £30,000 - recent prices for the same type of house is £275,000 which I could never have afforded at any time in my career.

If capping morgages and requiring deposits had been maintained and interest rates gradually increased some years ago, we would have defused the personal and mortgage debt bubble. Otherwise something had to burst it, and it did.

Toom

Recently looked into moving to a retirement flat. Typical McCathy and Stone one bedroom flat in my area is about £95,000. My mother-in-law in Florida recently moved out her retirement apartment to go into more sheltered housing. Apartment was on the market for many months before selling for $20,000

Toom

Not to mention the neighbours.

First-time-buyers can get together as couples so that they can raise some £120K at 3x salary (subject to some rules I can't remember). With some deposit, that's not far off the average house price, putting less pressure on house prices to fall further.

And average priced houses are likely to be bought by non-first-time-buyers with more funds.

You also should take into account the circumstances of the person/people buying. If it's a single-earner family with 4 kids, then 3-times earnings may well be a stretch on their finances. However, if it's a single person with no dependents/vices/debts then a larger multiple could be appropriate. It's not so much about salary as _disposable_ income.

I did too.

Abelard said people shouldn't...

'Bartc' wrote this:

The black thing on the left?

'Mark' wrote this:

The banks who borrow the money from savers. That always been the way.

That looks like next door's.

Indeed, but in most circumstances someone with four kids is going to need a higher income to afford a house, and need a bigger and more expensive house, than a single person and, given their commitments, is less well placed to take financial risks. It just another of many issues that perhaps people should need to consider more when planning a family?

Toom

regards

you must understand 'new' labour.... their 'announcements' are not directed towards reality... they are directed to headlines to fool their natural constituency...the ignorant and uninformed....

that would not inflate away the debts and raise the sticker price for those who are in negative equity

it's almost certainly another bubble...imv it's probing towards $900 on the way down... gold is just a casino....

obviously the shot was misdirected!

why not now post 'buy lottery tickets'? you can add value to gold for those who desire fripperies! that gives you an unusual perspective

regards

I think that nice Mister Market is going to do that....

no i didn't.... i said it was gambling....as it is....

the real open market price of gold is far lower... the only reason for its level is government bank hoarding it's a captive market like diamonds

it is also an unproductive asset.... gold still isn't at the real terms level it was around ?1985...

Yes. Most right-wingers here are pleased with the fall in house prices, and have been complaining about the ridiculous costs of homes for many years.

It's all a casino.

If you invested in blue chip bank shares you just lost your shirt...

Your blind hatred of bullion as an investment makes you unbalanced.

You invalidated any opinions you may have given over the years by your blind hatred of gold, which turned out to be the only investment of 2008 that actually made any money.

You're as doctrinaire as the Socialists you claim to loath.

I notice your claims of sophisticated financial moves by the Bush government stopped a few months ago...

They're all a bunch of gamblers and everyone but the gold bugs backed the wrong horse last year.