Reply to: House price propping up goes national

[minestrone]

When my mother and father got married in the 50s they bought a decent flat in a reasonable area for 800 quid, my mum had just went into teaching and my dad was in the army and both of them had a salary of 800 quid, no 5 minute mortgages in those days so you had to save for while but that flat is now worth 200,000, 5 times maybe the joint income of a private and a first year.

Even when I left uni in the late 90s you could pick up a 1 bedroom in a good area for 50k, they will go for 220 now, affordable for nearly all self funded graduates.

I know a couple, one who is a grad lawyer for a bank with the favourable mortgage deal and a final year law student with a full time job at night and all they could afford was a flat in a hosing scheme last year.

Labour have royally ****ed this country up and if anyone thinks the conservatives would have done the same they can read Major's first and only budget speech where he addresses the problems of out of control citizen debt to the nation and his efforts to curb that.

What I liked about today was that it was a budget that centered on how we should make the earning of money and it's taxation to be made easy. The budget was often a side show for labour as they had little or no clue where the nations wealth comes from, a few meaningless lines about golden rules, hundreds of taxes and then back to the real job of lawyers who run governments, making up laws.

[hyperD]

But the builder is surely going to work that 10% into the asking price.

Anyone see the slight flaw here?

Yes. Another inflated, non free market - once again due to government interference in order to appease a particular voting demographic and keep the self-serving politicos in the elitist manner that they think they are entitled to.

The unintended consequence of so called government "good intentions", particularly prevalent amongst the virulent "socialists".

Without addressing the reasons behind the spike: supply/demand/restrictive planning/injection of cheap cash flooding the market/low interest rates/speculation/higher relative rentals/currency devaluation/social encouragement and the constant government paranoia knowing that if the housing market collapses to more realistic levels of valuation, the economy will tank to 1970's levels of production.

Yet another concrete point in the argument for less government.

And less Kirsty Soapy Teet-Venk.

[minestrone]

Anyway as it only covers England I don't know why I am bothered.

I suppose he has kept booze and fags the same so we are happy as well.

[minestrone]

From what I saw in the eighties a lot of those first time buyer places were new build flats which the buyers then couldn't get rid of if they wanted to move to a bigger place or relocate for work. Did you know that (unlike the US), you can't sell a house with negative equity unless you can stump up the cash to cover the shortfall?

If you want a mobile workforce you really shouldn't lock a load of first time buyers into their first location.

We do not tend to get these crazy boom and bust cycles like England because our conveyancing system is, well 'fit for purpose'. Once the deal is done that it it, you cannot go in later and chuck in more money like a drunk man at a poker game. The volatility and insecurity in your system creates a volatile and insecure housing market. There has never been a sustained period of negative equity in Scotland and that is down to the agreement at offer stage being made by lawyers which they cannot back out from.

[minestrone]

I had a vision of Brownstuff saying "no more boom and bust" when reading that. Trying to manufacture a false stability is not viable long term.

Besides, why have stability at the top of the bubble, why not the bottom?

Housing and food should be protected from profiteering. Let the prices crash to their normal affordable level, where young first time buyers can afford starter homes on minimum wage, then have the prices fixed to inflation. Affordable housing so we can spend more on other stuff, where they can make all the profit they want.

House prices are certainly not going to go up by any great amount. THe banks cannot supply the capital and the fruit loops are no longer running the country.

Cameron will certainly do everything humanly possible to stop house prices going down he wants to protect his voters from losing their unearned wealth. If it starts going bad for them he is out and he knows that.

Really the greatest hold on house prices staying the same is the vast majority of capital rich UK home owners who will rather not sell for less than what it was worth at the near high, they will take a drop but not a substantial one, they will be the glue thay keeps the house prices the same. The recession has not really hit these people.

True there will be plenty of public sector workers getting sent to the dole queue but if you believed their press they could never afford a house in England anyway so screw their moaning soggy arses.

But really if we kicked out the bobs we could get 60,000 UK/EU based IT workers back in employment and onto a housing market which would be far greater than this 'initiative'

[PAH]

But the builder is surely going to work that 10% into the asking price.

Much like the car manufacturers bumped their prices up by a few grand when the scrappage scheme was announced.

[Sysman]

As I understood it from the radio this morning, this should say that the government and home builder would EACH put up 10%. That would leave the buyer to find 75% rather than 85%.

Still not easy, but easier.

But I might have been dreaming.

But the builder is surely going to work that 10% into the asking price.

Anyone see the slight flaw here?

[Sysman]

I cannot really see 10,000 first time houses making any impact on the nations house prices and these houses will not increase in value because of the funding. The nation needs a leveling house prices over the next 10 or 20 years and I do not see it as a problem to help some in the community while that goes on, after all it was Labour's fault they cannot buy a house and this Government quite explicitly sets itself out as a Government to cure the problems of the last.

No different to what Thatcher did.

From what I saw in the eighties a lot of those first time buyer places were new build flats which the buyers then couldn't get rid of if they wanted to move to a bigger place or relocate for work. Did you know that (unlike the US), you can't sell a house with negative equity unless you can stump up the cash to cover the shortfall?

If you want a mobile workforce you really shouldn't lock a load of first time buyers into their first location.

[PAH]

As long as house prices remain stable ...

I had a vision of Brownstuff saying "no more boom and bust" when reading that. Trying to manufacture a false stability is not viable long term.

Besides, why have stability at the top of the bubble, why not the bottom?

Housing and food should be protected from profiteering. Let the prices crash to their normal affordable level, where young first time buyers can afford starter homes on minimum wage, then have the prices fixed to inflation. Affordable housing so we can spend more on other stuff, where they can make all the profit they want.

[Doggy Styles]

"The buyer would have to put up 5% of the cost, while the government and home builder would both put up 10%. "

So they buyer would still need to find 85% mortgage - not easy at present I reckon.

As I understood it from the radio this morning, this should say that the government and home builder would EACH put up 10%. That would leave the buyer to find 75% rather than 85%.

Still not easy, but easier.

But I might have been dreaming.

[minestrone]

As long as house prices remain stable the government is correct to help at the bottom of the market if it is dome correctly and the numbers they are quoting look to be reasonable.

With average salaries and average house prices just now coupled with no banks lending to meet the 2 we face a real possibility that in 10 years time the vast majority of 30 somethings will not be paying off a house, then that knocks into savings and pensions 20 years down the line.

The generational house buying lag that we could sleep walk into could be worse for the country that labour's house price boom. (and I do blame Labour for the potential problems we could face in the next 50 years)

I think all credit to the conservatives for looking beyond the quick fixes that labour went for.

EDIT: all credit to the coalition.

[PAH]

I cannot really see 10,000 first time houses making any impact on the nations house prices and these houses will not increase in value because of the funding.

I agree with that, but it is going to trap gullible first time buyers pressured by family/friends/partners into buying an overpriced property in a falling market. Which is fine if they can continue to afford the payments and continue to be in employment.

Though with the latter there's always the mortgage interest relief they can claim if unemployed.

Lots of meddling due to too many people being trapped in the massive bubble that's grown over the last decade.

[minestrone]

We aren't in the buying votes before poll day stage yet either, this is economic pain that will have been forgotten by election day and things will be better by then of the government cycle.

While that may have been true in the past this collation are buying Lib Votes every day.

THis government does not have a fixed term and never will have.

[TimberWolf]

We aren't in the buying votes before poll day stage yet either, this is economic pain that will have been forgotten by election day and things will be better by then of the government cycle.

[minestrone]

So it's obvious the government will try anything to keep house prices unrealistically high. Must be too much riding on it to allow the natural deflation to occur that already has done in USA and is happening in other parts of the EU (Spain, NI).

Just looking at some properties on nethouseprices to see that they've more than doubled in value in the last 10 years makes me think this is ultimately unsustainable. Wages certainly haven't doubled in that time.

I can't see how this can end well for those buying now when prices do seem to be coming down in lots of areas. Only takes interest rates to go up significantly and many will be in negative equity and financially over stretched, and worried about losing their jobs.

I cannot really see 10,000 first time houses making any impact on the nations house prices and these houses will not increase in value because of the funding. The nation needs a leveling house prices over the next 10 or 20 years and I do not see it as a problem to help some in the community while that goes on, after all it was Labour's fault they cannot buy a house and this Government quite explicitly sets itself out as a Government to cure the problems of the last.

No different to what Thatcher did.