On the business section of the Dunphy radio show this morning he alluded to the case wherby on bank (Northern Trust It think) had given a particular customer a 100% morgtage and 10x salary. Ridiculous
Having read the actual story, it's normal sensationalist media nonsense. Firstly, the customer was going through a divorce and had a large settlement coming.
Secondly the customer had a business relationship with the bank, this may mean many things, but essentially shows that the customer is someone whom the bank have been dealing with over a number of years and they are obviously very satisfied with that persons trustworthiness and more importantly their net worth.
Where are people getting the money from?
Indeed, something I ponder deeply every day, my theory thusfar is that it's coming from equity built up on the home they've traded up from. There is also the issue of parental gifts, as parents are the wealthy peoples now, there is undoubtedly a tendency for them to dole out large amounts to their kids to help them get a foot on the ladder.
But all that aside, you are right, it is amazing - you would'nt want to have any kids on top of that mortgage either.
To yourself Charlie, do you feel that interest rate hikes have/will (presuming they continue on their .25% every 3 months trend) made much of a difference? And if not, when do you feel they may have?