Economics Nerd Central/ The Global Inflation Thread

[Handy Run]

Which households have a spare £6k?

Ones that will no longer be spending that £6k in the local economy

 

[How bad boy]

Su

Faster rise than expected.

Sunak still says that he will not do anything for mortgage holders?

@julesmchamish


Two years ago the average #mortgage 2Y fix rate was 1.39%, now it is 6.01%.

Repayment mortgage £200,000 over 25 years monthly payments at rate:- 1.39% June ‘21 = £789.58 6.01% TODAY = £1,289.83 £500.25 extra PER MONTH £6,003 extra PER YEAR


Which households have a spare £6k?

While the average mortgage size in the UK is £184k, there are parts of the country and sections of the population for whom that is a laughably tiny mortgage.


This is the only house on Rightmove in Reading listed for under £200k that is not under one of those weird shared ownership or retirement schemes:

Check out this 2 bedroom house for sale on Rightmove

2 bedroom house for sale in 32 Kentwood Hill, Tilehurst, Reading, RG31 for £165,000. Marketed by McHugh and Co, London

www.rightmove.co.uk

And it's an auction, so that's merely a guide price.

There are going to be a lot of younger and middle aged Tory voters absolutely fucked by these interest rate rises (as Tory voting is fairly highly correlated with home ownership).


The Ward next to mine, Caversham Heights, voted mostly Tory in the most recent council elections.

This is the cheapest house in the area not on some sort of scheme, £579k:

Check out this 3 bedroom terraced house for sale on Rightmove

3 bedroom terraced house for sale in Uplands Road, Caversham Heights, Reading, RG4 for £579,950. Marketed by Bridges Estate Agents, Caversham

www.rightmove.co.uk

 

[Stacky]

While the average mortgage size in the UK is £184k, there are parts of the country and sections of the population for whom that is a laughably tiny mortgage.


This is the only house on Rightmove in Reading listed for under £200k that is not under one of those weird shared ownership or retirement schemes:

Check out this 2 bedroom house for sale on Rightmove

2 bedroom house for sale in 32 Kentwood Hill, Tilehurst, Reading, RG31 for £165,000. Marketed by McHugh and Co, London

www.rightmove.co.uk

And it's an auction, so that's merely a guide price.

There are going to be a lot of younger and middle aged Tory voters absolutely fucked by these interest rate rises (as Tory voting is fairly highly correlated with home ownership).


The Ward next to mine, Caversham Heights, voted mostly Tory in the most recent council elections.

This is the cheapest house in the area not on some sort of scheme, £579k:

Check out this 3 bedroom terraced house for sale on Rightmove

3 bedroom terraced house for sale in Uplands Road, Caversham Heights, Reading, RG4 for £579,950. Marketed by Bridges Estate Agents, Caversham

www.rightmove.co.uk

All those Tory voters are either retired or now in serious financial peril now and more so in the next few years.

This is going to be a massive mortgage crisis.

 

[How bad boy]

All those Tory voters are either retired or now in serious financial peril now and more so in the next few years.

This is going to be a massive mortgage crisis.

Yep, albeit I had a chat with a retiree over the weekend who claimed it's all a nonsense and in my day we simply didn't have holidays abroad, unlike young people these days.


They had just come back from a holiday abroad.

 

[Stacky]

Yep, albeit I had a chat with a retiree over the weekend who claimed it's all a nonsense and in my day we simply didn't have holidays abroad, unlike young people these days.


They had just come back from a holiday abroad.

Things were just always "better" back in their day even if they weren't......... A week in Southend-on-Sea or Butlins did them no harm whatsoever.


This is the same demographic that voted top stop others living, working, studying or travelling freely etc in the neighboring 27 countries.

 

[Meridian]

Things were just always "better" back in their day even if they weren't......... A week in Southend-on-Sea or Butlins did them no harm whatsoever.


This is the same demographic that voted top stop others living, working, studying or travelling freely etc in the neighboring 27 countries.

I'll tell you lad, back in my day we had no issues swimming amongst the shite floating in the tide at Southend-on-Sea.
Them youngings just need to get on with it now and stop moaning

 

[How bad boy]

UK inflation stuck at 8.7%, higher than the market consensus forecasts, so it'll be higher interest rates from the BoE tomorrow.

For contrast, Eurozone inflation for May had dropped from 7% to 6.1%.

The UK is not in a good place, stagflation, albeit without the high unemployment https://www.investopedia.com/terms/s/stagflation.asp

 

[Stacky]

UK inflation stuck at 8.7%, higher than the market consensus forecasts, so it'll be higher interest rates from the BoE tomorrow.

For contrast, Eurozone inflation for May had dropped from 7% to 6.1%.

The UK is not in a good place, stagflation, albeit without the high unemployment https://www.investopedia.com/terms/s/stagflation.asp

Pretty grim and the BOE will have no choice but to raise rates.

Core inflation going up and the Chancellors plans in tatters-further interest rate rises could tip the economy into recession.

God help mortgage holders.

 

[How bad boy]

Pretty grim and the BOE will have no choice but to raise rates.

Core inflation going up and the Chancellors plans in tatters-further interest rate rises could tip the economy into recession.

God help mortgage holders.
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Because nobody else will.

Have calculated that getting a 5 year fix last year will save me £30k over 3 years at current rates.

 

[Stacky]

Because nobody else will.

Have calculated that getting a 5 year fix last year will save me £30k over 3 years at current rates.

Perfect timing and the way things are going potentially saving you even more.