Todays interest rate rise.

Johnny Vincents Motorbike

Johnny Vincents Motorbike

Well-known member
Please thank the Conservatives, Truss and the Enablers.

'strong & stable - stealing the milk, food and wages off your table'.


An increase from 2.25% to 3% would mean a £73.49 monthly increase for the average tracker mortgage, and £46.22 for the average standard variable rate (SVR) mortgage.

An increase to 3% would mean that since December, when the base rate was 0.1%, the average monthly mortgage payment has increased £284.17 for the average tracker, and £178.70 for the average SVR.

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An increase from 2.25% to 2.75% would mean a £49 monthly increase for the average tracker mortgage, and £30.81 for the average SVR.

An increase to 2.75% would mean that since December the average monthly mortgage payment has increased £259.67 for the average tracker, and £163.29 for the average SVR.

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An increase from 2.25% to 3.25% would mean a £97.99 monthly increase for the average tracker mortgage, and £61.62 for the average SVR.

An increase to 3.25% would mean that since December the average monthly mortgage payment has increased £308.67 for the average tracker, and £194.10 for the average SVR.​
 
Its a weird one because I don’t think banks and building society’s will increase their fixed rates on the back of this rise

This is due the incompetence of the mini budget and already driving fixed rates up through swap rates
 
GazC_MFC said:
Its a weird one because I don’t think banks and building society’s will increase their fixed rates on the back of this rise

This is due the incompetence of the mini budget and already driving fixed rates up through swap rates
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That's correct IMO. Current fixed rates reflect expected future increases in BoE base rate and are therefore already priced in.
 
3% base rates is still lower than average to me on a long term view.

Interest rates have been too low in recent years.

I do feel sorry for new younger borrowers it can be tough - we had to deal with 11.5% in the late 1980s and went into negative equity when the housing market dropped 15%

Long term 4% base rate and inflation 2.5% seem realistic targets.
 
Redwurzel said:
3% base rates is still lower than average to me on a long term view.

Interest rates have been too low in recent years.

I do feel sorry for new younger borrowers it can be tough - we had to deal with 11.5% in the late 1980s and went into negative equity when the housing market dropped 15%

Long term 4% base rate and inflation 2.5% seem realistic targets.
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That doesn't take into account that house values are way higher than they used to be though. 10% of £20k is very different to 4% of £300k.

I know we have this conversation every month when the rates rise but you can't compare interest rates without talking about the house values and the difference between house values and salaries then and now. Young people can't afford house prices with a 0% interest rate. Any rate rises just make it impossible.
 
House prices have started to slow ands fall. The rate increase will only continue this trend. Sadly with higher interest rates young first time buyers still won't be able to afford their first homes.
 
Nano said:
That doesn't take into account that house values are way higher than they used to be though. 10% of £20k is very different to 4% of £300k.

I know we have this conversation every month when the rates rise but you can't compare interest rates without talking about the house values and the difference between house values and salaries then and now. Young people can't afford house prices with a 0% interest rate. Any rate rises just make it impossible.
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I wish people would realise this. Had a conversation with my elderly mother in law last week who didn't think a 6% mortgage was bad! "We had 14% back in the day" she exclaimed. I then had to explain to her exactly what you posted - 14% of £40k (the house value at the time) is different to 6% of £350k (her current house value).

I find the lack of understanding on this quite strange. People seem to have turned their brains off these last 10 years.
 
MolteniArcore said:
I wish people would realise this. Had a conversation with my elderly mother in law last week who didn't think a 6% mortgage was bad! "We had 14% back in the day" she exclaimed. I then had to explain to her exactly what you posted - 14% of £40k (the house value at the time) is different to 6% of £350k (her current house value).

I find the lack of understanding on this quite strange. People seem to have turned their brains off these last 10 years.
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People also forget the tax relief they had to offset those rates and that they were getting plenty of interest on their savings at the same time.
 
Redwurzel said:
3% base rates is still lower than average to me on a long term view.

Interest rates have been too low in recent years.

I do feel sorry for new younger borrowers it can be tough - we had to deal with 11.5% in the late 1980s and went into negative equity when the housing market dropped 15%

Long term 4% base rate and inflation 2.5% seem realistic targets.
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2% to 6% is a larger increase than 8% to 11.5%
 
A quick search on RightMove shows how many asking prices have been reduced recently. Plenty more will have just been relisted with lower asking prices too.
 
My friends are moving to Ingleby after years of our friend group telling them to as their street in Thornaby is high crime and asb, and their kid is starting school this year.

As they left it so long, a house that was say £230k in 2018 is now over £300k and their eventual £335k house purchase isn't that much bigger than where
they are coming from, but a much nicer street and they won't be waking up to burnt our cars on the lawn. Expensive waiting so long though! If we had spent that when we moved we would have a huge place.

We are still on all the Rightmove alerts and some houses they discounted as not suitable have had reductions or still for sale whereas when they first started looking at start of the year places were selling within a few days. Some were overpriced to begin with though and it's just them having to be realistic with expectations.

They've seen some get listed now with big airy extensions, bifolds, bigger rooms etc for less than what they have paid so whilst locally the prices are still strong in this area, I think there has definitely been a slow down. They can't really cancel and go with the newer ones though because would mean a much more expensive rate
 
BoroMart said:
one month on the back of a disastrous 'fiscal event' isn't evidence of a reduction in house prices, that could be wiped away next month, far too early to say yet
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Quite right. But I don't see any evidence or reason why the slump won't continue. We are effectively in a recession, interest rates going up, cost of living including energy bills squeezing affordability, lack of confidence in government fiscal policy, austerity on the horizon, tax rises etc - non of this screams house price rises to me. I'm not even sure a stamp duty cut would help.

My wife works for a large house building company - reservations have dropped. But maybe that will stop house building and push prices up? Who knows. There are no plans to stop building though.
 
House prices don't tend to fall much, they stagnate but rarely fall. If people can't get the price they want they just don't sell instead of selling for less than they think it's worth. So all that happens is the total houses available for sale reduces and you're left with the ones that people have to sell which get reduced because they need the sale. All the people that want to sell but aren't desperate just wait because not only are they not getting the price they want for theirs but there are no good houses available for them to buy.
 
ThatFragranceGuy said:
My friends are moving to Ingleby after years of our friend group telling them to as their street in Thornaby is high crime and asb, and their kid is starting school this year.

As they left it so long, a house that was say £230k in 2018 is now over £300k and their eventual £335k house purchase isn't that much bigger than where
they are coming from, but a much nicer street and they won't be waking up to burnt our cars on the lawn. Expensive waiting so long though! If we had spent that when we moved we would have a huge place.

We are still on all the Rightmove alerts and some houses they discounted as not suitable have had reductions or still for sale whereas when they first started looking at start of the year places were selling within a few days. Some were overpriced to begin with though and it's just them having to be realistic with expectations.

They've seen some get listed now with big airy extensions, bifolds, bigger rooms etc for less than what they have paid so whilst locally the prices are still strong in this area, I think there has definitely been a slow down. They can't really cancel and go with the newer ones though because would mean a much more expensive rate
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the biggest estate agent in IB Michael poole always seems to overprice listings some are quite ridiculous over the top like 20% more than what i would say is the market value, your thinking that will never sell at that price and that was in the summer before things took a down turn only for them to be reduced a month or two later.
Lots of houses in my street in IB have been sold most within a month of going on sale at the asking price, i think the downturn in some areas wont be that dramatic.
 
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