From City AM:
A JUMP in loans to home movers outweighed a slip in lending to first-time buyers, data from the Council of Mortgage Lenders revealed yesterday, leading to an overall increase in mortgage market lending...
For existing homeowners the average income multiple declined from 2.91 to 2.88, and the average loan to value (LTV) ratio slipped from 70 per cent to 69 per cent.
But first-time buyers faced a market that opened up in some areas, if they could get hold of credit. One per cent fewer mortgages were agreed, but their value climbed 4.2 per cent on the month, and the average LTV climbed one percentage point to 81 per cent. The main area of tightening was in average income multiples, which slipped from 3.29 in June, to 3.21 in July.
Interesting.
For a home mover (aka 'second-stepper') the house price-to-income multiple is about 4.2 (2.88 divided by 69%) and for first time buyers, it's about 4.0 (3.21 divided by 81%), i.e. there's barely any difference.
(The multiple four is also dramatically lower than the break-even point for who'd be worse off under full-on LVT. Yer typical FTB or second-stepper with a house price-to-income multiple of four would pay about £10,000 a year less in tax and get about £10,000 a year more in Citizen's Dividend.)
Thursday 13 September 2012
The answer is four
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4 comments:
Answer's 42 innit?
JH, that's what we are brought up to believe. Doesn't make it true.
Yer typical FTB or second-stepper with a house price-to-income multiple of four would pay about £10,000 a year less in tax and get about £10,000 a year more in Citizen's Dividend.)
Were he employed, of course.
JH, if he's not employed, he won't be first time buying or second stepping. And his house price to income ratio would be infinity. That's why I'm interested in the typical or average or median.
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