Quizzes & Puzzles0 min ago
Mortgage Rates
23 Answers
It only took Dizzy Lizzy Truss 48 days in power to destroy the mortgage market, and put thousands of people in debt, some losing their homes.
KS looks like to have sorted that mess out in only just over a 100 days. Look forward to the rates coming down me old China.
Answers
I Agree with Mr Nicebloke, well done Sir Keir and the Labour Party ....Good News....me old China.
08:08 Thu 17th Oct 2024
Good news, although they are already lower than they were most of the time than in the Labour years under Blair and Brown and much lower than in the Labour and Tory Callaghan, Thatcher and Major years. Most of us can remember mortgage rates of 10-15%. The 2010-2020 period had unusually low mortgae rates.
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Ms Truss didn't actually do anything. She wan't given the chance. The money markets didn't like what she planned to do and threw a wobbly.
Once it was apparent that her plans were not going to happen conditions should have returned to normal. But they didn't. This was mainly because there were - and still are - other factors in play which have not been addressed by either the previous government or this one.
Near the top of the list of these principle factors are excessive government spending leading to excessive taxation and excessive government borrowing.
Underlying inflation is still high. Last month's figures are likley to prove a temporary blip. The problems which lead to high interest rates have not been addressed and some of the new government's actions and proposals will simply exacerbate them.
The mortgage market was not destroyed. It was simply reset to a level more realistic than the ridiculous near zero rates which had prevailed for over 15 years and which had contributed greatly towards house price inflation.
So no, it does not look like the new PM has sorted out the mortgage problem. In fact I'm not so sure such a problem exists at all. Mortgages are readily available at realistic rates which give people who lend their money to banks a decent return. If you are suggesting he has returned mortgage rates to unrealistically low levels (which were made possible by printing worthless money), he hasn't and, on current form he is unlikely to.
Liz Truss's plans were never implemented, so, all things being equal, any market reaction should have quickly reversed once it became clear the plans (and Liz Truss) had been ditched. The fact that they only fell slightly must have been due to other factors such as increases in inflation (seen in all major countries) due to things like worldwide energy prices.
The reasons interest rates are continuing to fall now here and across Europe and USA have almost nothing to do with what this government has or hasn't done- it's far more complicated than that. What happens in Europe and USA, and with worldwide energy, oil and commodity prices, is the main driver.
