Negative Interest rates will not have an effect on property
We will not go to negative interest rates as most mortgages already have a collar or safety net in place.
Bank of England introduced negative interest rates, how will that affect property more lending by banks?
I don't actually think that negative interest rate is going to affect. First of all I don't believe if we go negative interest rates most mortgages now have a collar in other words they won't drop below. It's not like you're going to get negative interest rates. I think the positive effect on cash flow for us as individuals is largely done and dusted now.
That's not going to change I don't think but what it does do is it gives the banks more margin and when it gives the banks more margin then they're more likely to have cash to lend and I think that's where that will assist.
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It's a very different market in Scotland, it's a smaller market. There's some fundamental changes namely oil and gas with all the issues there and that I know Aberdeen and a few of those places house prices have dropped considerably. So, it depends on how that's reacted.
You know more lending by banks? The challenge is that unless the government mandates you know like with a CBILS loan or a Bounce Back Loan and says you know will underwrite your risk they're not going to lend, they're not able to take the thing. The problem is it's too easy for you know if someone defaults that they blame the lender you know you weren't responsible lending you know on the one hand you've got Boris saying we want 95% mortgages but on the other hand they're saying a responsible lending.
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In Australia one of the things they're looking to do is they went responsible lending cramped down and then all of a sudden oh that's a little bit too much no no we'll open it back up and now they've said no we're just going to write all that off and you can lend whatever you want. For me I'm a free market man so I'm like if a lender wants to lend under whatever circumstances, as long as it's not you know it's ridiculous lending where you know they can't lend back and you know you're basically stealing from then fine you know let them do it.
BRETT: Any thoughts you guys negative interest rates.
RITESH: I mean pretty much what you said there. I agree I said the main thing is like you said the banks you know if anyone thinks so they're going to be borrowing money at your you know negative interest rates they've got that in the contract, it's not happening.
BRETT: no that's right no i know exactly
Bank of England introduced negative interest rates, how will that affect property more lending by banks?
I don't actually think that negative interest rate is going to affect. First of all I don't believe if we go negative interest rates most mortgages now have a collar in other words they won't drop below. It's not like you're going to get negative interest rates. I think the positive effect on cash flow for us as individuals is largely done and dusted now. That's not going to change I don't think but what it does do is it gives the banks more margin and when it gives the banks more margin then they're more likely to have cash to lend and I think that's where that will assist. You know more lending by banks? The challenge is that unless the government mandates you know like with a CBILS loan or a Bounce Back Loan and says you know will underwrite your risk they're not going to lend, they're not able to take the thing. The problem is it's too easy for you know if someone defaults that they blame the lender you know you weren't responsible lending you know on the one hand you've got Boris saying we want 95% mortgages but on the other hand they're saying a responsible lending. In Australia one of the things they're looking to do is they went responsible lending cramped down and then all of a sudden oh that's a little bit too much no no we'll open it back up and now they've said no we're just going to write all that off and you can lend whatever you want. For me I'm a free market man so I'm like if a lender wants to lend under whatever circumstances, as long as it's not you know it's ridiculous lending where you know they can't lend back and you know you're basically stealing from then fine you know let them do it.
BRETT: Any thoughts you guys negative interest rates.
RITESH: I mean pretty much what you said there. I agree I said the main thing is like you said the banks you know if anyone thinks so they're going to be borrowing money at your you know negative interest rates they've got that in the contract, it's not happening.
BRETT: no that's right no i know exactly
