In an era of low interest rates across most developed countries it's hard for some people to comprehend double digit interest rates and inflation to match. While lending to individuals for mortgages and to businesses stays depressed because of tighter banking regulations and a knee jerk reaction to the cavalier actions of the recent past mean everything has been kept in check that won't last forever.
Economies are slowly picking up and corporate memories are fading so it won't be too long before it starts to get easier to get mortgages and income multiples start to rise again. Traditionally a 3x multiplier has been seen as fair but stretching for people to pay of their loans but when 'confidence' increases so do the multipliers. Let's hope borrowers are more savvy this time round and only go for what they can afford.
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