spiral
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Post by spiral on Aug 7, 2014 9:18:01 GMT
WIth over 1.5m in the 5yr market, I see the chasing down of rates has started with sub 6.0% offers and about 600K at 6.2%. With some 0.5m at offers > 6.2% how long will it be before those people start moving their money to below 6.2% to get it lent out. This is by far the most money I've seen in the last year (I've had to modify my spreadsheet to take account of the "m" in 1.5m because it hadn't seen it before). I wouldn't be surprised if MR becomes 5.8 or 5.9 in the next week or so.
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oldgrumpy
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Post by oldgrumpy on Aug 7, 2014 9:42:09 GMT
Yep! I've adjusted to 6.1% today - got 6.2% yesterday on some bits near the front of the queue.
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Post by moneyball on Aug 7, 2014 10:30:35 GMT
Having done some basic and rudimentry technical analysis, it might be a little too early to call a decline in MR below 6.0% just yet.
We still appear to be in a slightly up trend and/or sideways on rates for past few months, so rates between 6.0 and 6.3 are to be expected at the moment.
Lender balances have shot up past 8mil (they were around 5mil about 2 months ago) so obviously more pressure, but demand is also higher over that period. Personally, I wouldn't chase below 6.1% at the moment.
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Post by yorkshireman on Aug 7, 2014 10:37:08 GMT
Less than 6% for 5 years isn’t a good investment strategy in my book irrespective of the BoE saying the new “norm” is 3%. Better to settle for higher rates on AC or SS for the next year or so and review your tactics in light of the election result, whether the “recovery” is for real, the state of the housing market, Ukraine, the Middle East etc., etc.
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pikestaff
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Post by pikestaff on Aug 7, 2014 11:26:01 GMT
The rate was 5% just over a year ago. My impression is that only a small imbalance in supply and demand is enough to cause rates to shift, and we could find ourselves back there quite quickly unless a lot of people feel like yorkshireman.
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Post by davee39 on Aug 7, 2014 11:26:18 GMT
Less than 6% for 5 years isn’t a good investment strategy in my book irrespective of the BoE saying the new “norm” is 3%. Better to settle for higher rates on AC or SS for the next year or so and review your tactics in light of the election result, whether the “recovery” is for real, the state of the housing market, Ukraine, the Middle East etc., etc.
It's all about risk. 3.0% is just about available in an FSCS protected account 4.5 to 6.0% from higher risk equity income/bond products 5.0 to 6.0% from Zopa & Ratesetter Now if you have sleepless nights worrying about not getting your money back you should stop here. I have settled on All of the above, but will be pulling out of Saving Stream (too much property) and Funding Secure (Too few loans). Similarly Funding Circle is becoming over propertied and very inept (too few staff?), also incompetent in dealing with late payments, so my modest investment will not be topped up. Assetz looks fine, but out of my league, and I do not trust property loans. Next stop will be £15k in an RS ISA once the red tape machine has created a thousand pages of nonsensically restrictive rules.
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pikestaff
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Post by pikestaff on Aug 7, 2014 11:37:29 GMT
davee39, I don't know why you think AC is out of your league. The minimum investment is small and there is no need to bulk up and get a shadow account these days, with plenty available on the aftermarket. I share your reservations about property, which is the main thing holding me bank on AC, but the loans are not only property and their procedures seem to be very robust.
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Post by davee39 on Aug 7, 2014 13:00:32 GMT
davee39, I don't know why you think AC is out of your league. The minimum investment is small and there is no need to bulk up and get a shadow account these days, with plenty available on the aftermarket. I share your reservations about property, which is the main thing holding me bank on AC, but the loans are not only property and their procedures seem to be very robust. Thanks for the pointer. It is some time since I signed up and I have been foxed ever since by the primary market, shadow bids, drawdown and some of the intricacies of the property loans. The Secondary Market does look quite interesting and may well be worth looking into further.
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Investor
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Post by Investor on Aug 7, 2014 13:27:55 GMT
Less than 6% for 5 years isn’t a good investment strategy in my book irrespective of the BoE saying the new “norm” is 3%. Better to settle for higher rates on AC or SS for the next year or so and review your tactics in light of the election result, whether the “recovery” is for real, the state of the housing market, Ukraine, the Middle East etc., etc.
It's all about risk. 3.0% is just about available in an FSCS protected account 4.5 to 6.0% from higher risk equity income/bond products 5.0 to 6.0% from Zopa & Ratesetter Now if you have sleepless nights worrying about not getting your money back you should stop here. I have settled on All of the above, but will be pulling out of Saving Stream (too much property) and Funding Secure (Too few loans). Similarly Funding Circle is becoming over propertied and very inept (too few staff?), also incompetent in dealing with late payments, so my modest investment will not be topped up. Assetz looks fine, but out of my league, and I do not trust property loans. Next stop will be £15k in an RS ISA once the red tape machine has created a thousand pages of nonsensically restrictive rules. So the big question now is whether the red tape will allow us to 'transfer in' from an existing N/(ISA) into a p2x wrapped ISA. If you started your ISA nice and early as some of us did and have used full allowance since the £3k launch in 1999, you would now have 71k + 14 years compounded interest to invest in a new p2x ISA wrapped vehicle. Not sure any of the other platforms can compete with risk/reward for a 6.x% tax free savings plan, especially for those who have a high rate patient/leech relationship with the jolly men from HMRC. Of course that said when (if) the wider savings community become aware of this we could see a very substantial capital load going into some of the p2x platforms as ISA's begin to be transferred, this will obviously have an effect on rates on the platforms, unless the High Street Banks start to provide favourable NISA rates. So to answer the question "How low will it go" in the 5yr market my prediction is an annual average of 5.0%, dipping down to 2% on the 6th April each year.
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spiral
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Post by spiral on Aug 7, 2014 18:29:16 GMT
Net increase of 200k on 5yr market in last 24 hours (1.75m v 1.55m yesterday), 650k (similar to this morning) at 6.2 with 700k above this (500k this morning) so of all the new money received today, the net increase all sits at >6.2%
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Post by geoffrey on Aug 7, 2014 20:30:46 GMT
I'm still confused about where RS's "demand" figures fit into the equation. Every time I've looked at the "expected volume for the next 24 hours" over the past couple of weeks, it has stood at nearly 1 million, adding up the 5-year and 4-year markets. But whenever I look at the matched volume in the "last 24 hours", it is never more than about 300-400K. Why the discrepancy? Are a lot of borrowers getting approved and then turning down the rates offered? Or is "expected volume" just wildly inaccurate/optimistic?
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Post by davee39 on Aug 7, 2014 20:54:26 GMT
The demand figures are from a parallel universe. I used to watch them to see where to pitch my requested rates but they are always high. I suspect it is either based on enquiries/approvals or alternatively some archaic calculation. Ignore them. RS - explain them or stop publishing them.
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pikestaff
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Post by pikestaff on Aug 7, 2014 21:44:41 GMT
So the big question now is whether the red tape will allow us to 'transfer in' from an existing N/(ISA) into a p2x wrapped ISA. If you started your ISA nice and early as some of us did and have used full allowance since the £3k launch in 1999, you would now have 71k + 14 years compounded interest to invest in a new p2x ISA wrapped vehicle. ... So to answer the question "How low will it go" in the 5yr market my prediction is an annual average of 5.0%, dipping down to 2% on the 6th April each year. You are assuming transfers from cash ISAs only! The total limit in 1999 was £7k, and before ISAs (back to 1987) there were PEPs and TESSAs, which could be rolled into ISAs. There are said to be quite a few ISA millionaires out there. I'm nowhere near that league, but there may be more money out there than you think... Edit: I expect that the red tape will allow transfers in from existing (N)ISAs. What it probably won't allow is direct transfers from an ordinary p2x account into the NISA. If it's the same as stocks and shares ISAs you will have to sell outside the wrapper and buy inside. Platforms may offer this for a fee.
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Post by geoffrey on Aug 8, 2014 10:46:53 GMT
If it's the same as stocks and shares ISAs you will have to sell outside the wrapper and buy inside. Platforms may offer this for a fee. I'm not sure what the incentive for any platform would be to offer a Bed & NISA service, since they would want to use the NISA as a way of getting new capital into the platform rather than recycle old capital. Well, if the fee is juicy enough for the platform...
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pikestaff
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Post by pikestaff on Aug 8, 2014 15:41:50 GMT
geoffrey The main incentive, I think, may be to stop lenders going elsewhere
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