During my life time I have borrowed money for various reasons housing, expand my private business and such like. Agree debt can be useful in safe hands (not always a given.) Around 1981 I had a mortgage on a UK property; one day I received a letter from my friendly building society manager informing of a rate change from 20% up to 21% and a form to up my bank direct debit by a few pounds.
I was working in the local mine as an underground fitter and on a decent wage, tonnage bonus and overtime available in truth the mortgage increase of 20% to 21% made little difference to my life style.
The Black Bull in Yarm village High Street attracts people young and old from all walks of life including more than a few from what I call the Spam Belt: Ingleby Barwick apparently the largest Private Housing Estate in Europe.
Having a couple of pints there recently as is my wont I found myself talking to a smart young chap living in a nice new house on this estate. Well in truth his wife lives in the house and he visits on a monthly commute from his well-paid job in Qatar apparently he is on a negotiated 12 month contract at present. There is quite a lot of this type of work arrangement in the North East of England and I’m not convinced this is particularly healthy or conducive for a secure family / married life.
Even as I approach sixty I still feel I have a good eye for a well turned ankle and a pretty face I also notice on my nights outs lots of well-dressed singe females (alone at least or in marauding gangs) and the High Street littered with an excellent selection of fancy (expensive) cars.
However, I digressed; my new confidant (also a fitter) told me he has just secured a new 400,000.00 GBP mortgage on his house. Being interested in what’s going on around me but not wishing to be rude I asked what kind of rates are currently being offered. Apparently he negotiated a two year teaser rate at 1.5% I admit that did surprise me so I checked around the rates on offer and found one: Approx. 1.5% for two years and then 4% after that.
Now a couple of things I thought about later this smart you chap (I guessed about 27-28) will be facing a hefty change to his mortgage payment in a couple of years (I’m not sure they even think that far ahead.) I noted that he must have orchestra stalls to take on a mortgage of any size being on a twelve month contract either that or the heats getting to him in Qatar. But I also note the institutions here in the UK don’t find a one year contract any kind of impediment to making a loan.
Back in Queensland a young couple I know of are finding it difficult to get on the property ladder because as teacher’s they only ever have one year of tenure.
Now there’s a laugh “property ladder” more like debt tread-wheel!
The main point I wish to make and although I know I have waffled a little but there is one, is if that young chap keeps his job and manages to make the transition from 1.5% to 4% in his mortgage payments I guess all will be fine!
However, as I said earlier the 1981 rate change from 20% to 21% hardly bothered me, a one or two percent change in rates may have a bigger impact on those people out there in the Mortgage Spam Belt.
Writing the above made me wonder what a fitter would be making these days so I found this site.
By the way just from memory in 1981 I was making around GBP 8,000.00 PA and that’s what I paid for my first house in 1974 funny how things change.
Fitter And Turner Salary Comparison In 2008, the average salary for this job was £28,000. The average salary in 2010 was £28,000, based on 1 respondents (a difference of 0% from the 2009 figure. The average salary in 2011 was £19,000, based on 1 respondents (a difference of -32% from the 2010 figure. The median salary for a Fitter And Turner based on all salary survey responses is: £23,500
Working 4,000 feet underground back then for young Andy had its danger’s but a four hundred thousand pound mortgage on a one year’s contact that’s really living on the edge.
By the way Wooden Bear is a term of endearment and no offence meant it’s a memory aid and helps me recall people’s sentiment.
What ever happened to my other mate Biggles I bet I miss him more than he hates missing out on a good gloat after a good FOMC Gold price kicking?
