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Yep, overall cost of living is going to rocket this year. Not looking forward to it.
Its all pretty scary and not being discussed enough, for me its about not being able to buy another board/video game for others its about the use of foodbanks or not.
There's a reason why when I bought this house it was 5years fixed rate with Brexit on the horizon it was clear there would be high volatility.Inflation is a real problem. There's been a really unfortunate confluence of events including Brexit and the pandemic, so I hope we're seeing a shortish term spike rather than the new norm.
Rising inflation is often dampened by raising interest rates. Without wanting to sound old fartish about it, there's a whole generation of house buyers that only know incredibly cheap, and hardly fluctuating, mortgages of many times salaries. I suspect even limited interest rate rises would spell misery / repossession for many of those.
I remember sitting in an asset manager's office 2 or 3 years pre pandemic and hearing that interest rates of 4 - 5% were about right for Britain. Even allowing for what's happened since 2008, interest rates from 1971 to 2021 still averaged over 7%. We have been in an exceptional era for many years now and while low interest rates are great for borrowers they're rubbish for savers.
Those in authority have some really tough issues to face.
A house on my parents street has gone up by £120k over the course of COVID (family moved in just before lockdown, listed it on the market last week). Nothing to write home about, just standard suburban 3 bed, it's crazyBTW this was was my first at 34 so I've no idea who this generation of home buyers are because Millennials find it notoriously hard to get on the housing market, due to rocketing house prices since the early 90's and getting a mortgage has always been hard in the UK as the combined salary of everyone being giving the mortgage needs to be multipled by 4.5 to work out the maximum amount you could be lent.
Was that combined with stagnant wages, a hugely inflated housing market and people already in record debt though? I could see this potentially being worse if interest rates start rising.My dad was always telling me how bad it was in the 70s and early 80s with inflation and high interest rates to combat it. Looks like our generation are about to be hit by the same.
Was that combined with stagnant wages, a hugely inflated housing market and people already in record debt though? I could see this potentially being worse if interest rates start rising.
No government is going to want to tackle it as it's going to be painful for a lot of people. Numerous politicians have perfected the art of kicking the can down the road and soon it looks like we will run out of road...
yeh nobody told him.Don't worry, he didn't realise it was his birthday.