UK DEBT/IMPACT ON SPANISH PROPERTY ETC

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This topic contains 16 replies, has 9 voices, and was last updated by Profile photo of Inez Inez 9 years, 2 months ago.

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  • #53166
    Profile photo of Paul
    Paul
    Participant

    😮

    UK personal debt reaches 1.3 Trillion pounds

    UK property sales begin to stagnate and fall in some areas.

    BOE and Gov’t, and Banks lose credibility.

    Some feel Sterling is overvalued and may be sold, possibly a run on it.

    Any of these stats will further impact on Spanish and overseas property,

  • #75201
    Profile photo of Anonymous
    Anonymous
    Participant

    A run on sterling would cause mayhem. Inflation would go up because imports cost more, so then BofE puts interest rates up. If rates reach 7%, I think there will be serious problems in the housing market here.

    Isn’t it about time a less clumsy method was invented for controlling the economy other than interests rates! Talking about ‘opening a nut with a sledge hammer’. 🙄

  • #75203
    Profile photo of Anonymous
    Anonymous
    Participant

    Posted: Sat Sep 22, 2007 10:01 am Post subject:

    ________________________________________
    Someone says this and someone reads that.?

    What happens then is that its almost always bound to have a negative effect on only the Spanish property market.
    Wake up and realize that should ANY of these things happen it will be a worldwide problem
    .
    Only read yesterday that interests and mortgages are bound to be reduced in the U.K and Europe.
    Even those in government that try to control the financial markets cant agree the extent of the sub prime lending problem if its very bad then action will be needed or there will be problems however if its not then its back to work.

    Yep agree that the happy thread won’t work as in the main people with problems and those that consider they can help with answers post, but lets keep it sensible.
    Have any noticed that one of the most visited threads which has been at the fore front on a regular basis is the weekend joke thread, so doesn’t that tell you something?
    Many of us have problems, some worse than others.
    Some have had their problems resolved.
    Let’s try to help put pressure on the corruption that’s in Spain.
    As can be seen with one particular paddy that throws his toys out of the pram if some home truths are directed against him it’s difficult as he says.

    Some may wish to consider buying ( they still do you know ?)

    Lets do our best to help keep people really fully informed ?

    Better retreat to the bunker I feel. 😉

    Frank 8)

  • #75204
    Profile photo of Paul
    Paul
    Participant

    🙄

    It seems as if Gov’ts through their Feds. and BOE’s etc can manipulate economies to suit crisis’s such as Northern Rock, US recent rate cut etc. Get out of jail cards played at last minute, but hiding the the real issue of debt.

    They won’t be able to avert the huge personal debts though because it’s probably too late for many people, when fixed rate mortgages come to an end shortly people are facing 5 interest rate rises in one go although it seems likely the BOE will now reduce rates a quarter instead of raising them.

    Either way, less Brits will be buying in Spain and these so called emerging markets (jokes) if they are heavily indebted or can’t sell their UK props.

  • #75209
    Profile photo of Anonymous
    Anonymous
    Participant

    Either way, less Brits will be buying in Spain and these so called emerging markets (jokes) if they are heavily indebted or can’t sell their UK props.

    I agree Paul. I’m now waiting until the market bottoms out (2/3 years?)- and then buy. Anyone purchasing under the current climate needs their head examining.

    Just Frank – I don’t think we’ll see a rate cut; just not another increase. The BIG unknown is Iran. If France/Israel/America decide to have ‘a go’ what of rates then? Oil $100 / barrell plus etc

  • #75210
    Profile photo of Anonymous
    Anonymous
    Participant

    Paul

    If its bad it will be that people reduce or stop buying. ❓
    Thats how it works as well we know
    Maximus ? that word IF ?

    Frank 8)

  • #75214
    Profile photo of katy
    katy
    Spectator

    Exactly Frank, you can read conflicting reports in the same newspapers. Therefore, someone has to be right once at least. If anyone could predict correctly what would happen to interest rates, currency fluctuations and world conflicts, they wouldn’t be sat around writing about it!

    As for the spanish property market I can’t see things improving for a few years. Apart from financial indicators there is the simple fact of over supply. I have heard from a couple of people who are in the “trade” that enquiries are significantly up compared with the last 6 months. The Scandinavian countries aren’t as pessimistic as the British (and myself 😉 )

  • #75217
    Profile photo of mike
    mike
    Participant

    @katy wrote:

    Exactly Frank, you can read conflicting reports in the same newspapers. Therefore, someone has to be right once at least. If anyone could predict correctly what would happen to interest rates, currency fluctuations and world conflicts, they wouldn’t be sat around writing about it!

    No, they would be on internet forums writing about it, discussing it and hoping to have their arguments challenged. They will be looking at who makes the up the market, what tools they have to measure how well it is doing, what are the pitfalls and what common experiences have others encountered when buying property.

    They might consider the sector that they are studying and its impact on the wider economy. For example, if some unforseen event were to occur would people stop buying and how would that impact me? They might consider that the market was a little toppy and likely to fall. Would I want to buy then or if I had bought how eager would I then be to sell?

    I was discouraged from buying in Spain because the people I knew making hundreds of thousands euro investments didn’t seem capable of even considering the possibility of a downturn in the market. It seems to have been the same all over the world.

    So, what does this mean for interest rates? I dunno but I reckon that central banks will try to inflate their way out of the crisis but they will fail and we will end up like Japan. As I previously stated here

    http://www.spanishpropertyinsight.com/forums/viewtopic.php?p=3091&highlight=#3091

    If anyone has an alternative opinion I am all ears (eyes) because by debating the matter we learn and it might make some sleep more soundly at night in their very expensive but relatively valueless investment.

  • #75218
    Profile photo of katy
    katy
    Spectator

    I don’t really have an opinion, except maybe about the the opinion forecasters. Quite frankly I don’t give a damn 😉

  • #75222
    Profile photo of mike
    mike
    Participant

    @katy wrote:

    I don’t really have an opinion, except maybe about the the opinion forecasters. Quite frankly I don’t give a damn 😉

    Well done, Katy, as I don’t think you do care. Well done indeed

  • #75223
    Profile photo of Anonymous
    Anonymous
    Participant

    There seems to be a misconception here that IF the BoE cuts the base rate, then the mortgage rates will also fall.
    Consider that at the moment, the banks won’t lend to eachother even at rates well above the base rate -this is what the media is calling the credit crunch.
    Following the action of the Federal Reserve Bank of the USA and the Northern Rock fiasco, a cut in the base rate is quite feasible.
    Let’s be very clear about this though, should this happen, the lenders won’t be rushing to slash their mortgage rates as they have in the past because they don’t want to follow Northern Rock into quasi-bankruptcy.

  • #75227
    Profile photo of Anonymous
    Anonymous
    Participant

    Perversley the recent cut in the US could acctually drive mortgage rates up further as the markets factor in
    the future inflation it will cause.

    http://www.mortgage101.com/partner-s…n.asp?ID=64644

    Basically, it seems that Bernankes rate cut has had the desired effect of reducing short term interest rates but has raised inflationary expectations which has driven some long term rates up. As most US home buyers take out mortgages on long term fixed rates this is actually going to drive the cost of their borrowing up and may deter some from entering the housing market. It is therefore entirely possible that perversely the Feds move will actually make the US real estate bust worse. Of course, Bernanke’s decision to cut rates had nothing to do with rescuing cash strapped US sub prime borrowers and everything to do with bailing out the financial institutions who he is paid to serve.

    As has been pointed out central bank I/R and mortgage rates can become disconnected.

  • #75241
    Profile photo of Inez
    Inez
    Participant

    Well to add some levity to this one – I have to say I have noticed distinctly the phones a bit busier – not as mad as it has been in the past but there are viewings and enquiries and people still wanting to buy for all manner of reasons, so yes quieter and really a ‘normal’ market.

    It will remain to be seen what happens, but prices in the majority of cases cannot drop to far as this goes below the level of the mortgae on the property so while an owner who bought cash can take a hit, anyone mortgaged (99.9%) cannot!

    It remains to be seen if the banks will in fact cut their debt and accept an offer below the mortgage owing – at the moment they wont and any repos coming to me arent worth me putting on my site as their debts are over 80% of the bank valuation on them – a valuation with has been revised down by the very bank themself!

    So my prediction for what it is worth? Either the repos will be packaged and the debt sold on (doubtful) OR the banks will hold out and bite the bullet in a couple of years time when the BOE tells them to do that!

  • #75246
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Inez, Since when Bank of England has started get involved with the Spanish mortgages ???????????????????

  • #75252
    Profile photo of Inez
    Inez
    Participant

    OOOPS sorry 😳 I meant bank of spain – tough busy day today, thats my excuse and Im sticking to it!! 😀

  • #75258
    Profile photo of Anonymous
    Anonymous
    Participant

    Its that bottle of brandy you claim that you have finished to be blamed.

  • #75260
    Profile photo of Inez
    Inez
    Participant

    Hic! Coood b twuuuuu..

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