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SteelBlue05 said:Can I ask do you have a small mortgage or have you rented out rooms or something? As I would have thought an increase to 8-9% would be difficult to handle for most FTB's, I suppose it depends on the size of the mortgage relative to income....what % of your net monthly income currently goes on mortgage replayments?
room305 said:I'm sure if W2DW has a glance over this thread he'll tell you that rates of 8-9% are exactly what you should be preparing to handle ...
room305 said:I'm also expecting a substantial (>50%) wage increase next year so this should be of help.
SteelBlue05 said:Yeah but I think he will be surprised at peoples ability to cope with such a big increase. Although we have had only a few responses.
SteelBlue05 said:Yeah but I think he will be surprised as peoples ability to cope with such a big increase. Although we have had only a few responses.
ivuernis said:Who do you work for?
Neffa said:FTB's normally do not have IO loans so are not as exposed.
That's a key point. FTB just under a year ago, we bought in an area we'd be happy to live in for 10 years. I think it was worth it even with having to pay stamp duty, as opposed to a new house a further out of the city. I'm also able to cycle to work which balances out the greater expense by not having to run a 2nd car.room305 said:It's been mentioned here before but the FTBs who will be most affected I think, are those who have bought in an area they don't actually want to live. Those who bought to "get on the ladder" hoping their house would appreciate sufficiently to provide a deposit for an even more outrageously priced house in an area they want to live in.
When those gain don't materialise, or indeed the house even depreciates in value, those FTBs will be stuck where they are.
fago76 said:As for interest rate rises we're fixed at 2.75% for one year, and well aware of what kind of increase we'll get hit for once we come off this.
room305 said:- If you have any lump sums of money (SSIA etc.) it may be worth paying off a chunk of your mortgage before the new higher interest rates kick in.
- Start living as though you were paying the increased rate. Start saving the difference between what your mortgage repayment is now and what it will be. This way it will manifest as less of a shock.
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