4 July, 2021 at 3:18 am #1140675
Rosanna : someone was complaining the other day no matter how hard he worked there isnt enuff to pay his bills and it was getting him down
Flying kiwi: the whole dam system is et in favour of the rich tories.
Rosanna: this younger generartion will never never own a home, unless they are on a massive wage.
I would have answer this in the room… but was a little worse for ware after England’s win this evening.
It is the governments fault but not for the reasons you think, its that old chestnut interest rates.
The primary driver of prices, not physical supply and demand. You could literally pave the entire country over and put rabbit hutches for humans in every corner. House prices might fall – but they’d still cost more with interest rates at 2% than at 10%.
Let’s say you can afford to pay £1,000 a month for your mortgage; if interest rates suddenly plunge to 2% from 10% (and let’s assume it’s not because there’s been a massive crisis, which clearly is the only way that this scenario could ever happen), you’ll be able to borrow much more money than if interest rates are at 10%. In other words, £1,000 a month gets you a much bigger mortgage at 2% compared to 10%. So off you go into the market, wielding what looks like absolutely massive amounts of buying power.
Everyone else has the same increased buying power. So the same house you wanted to buy when rates were at 10% is still the same house when rates are 2%. But the amount you can afford to pay for it has shot up, so the house price shoots up. It really is that simple.
So all we have to do is put interest rates back up and this will fix the problem right? Its been tried in the UK back in the 1990’s leading to thousands losing there homes or negative equity housing trap for many others. And no Tory governments wants to repeat that mess.
A poor man is like a tightrope walker, one slip and you’re dead.
I’ve always said there needs to be a return to personal borrowing controls. They were taken out back in the 1980’s by Thatcher’s government ands its lend to all kinds of misery. Personal debts are at an all time high. Student loans, credit cards and more. This madness needs to be stopped.
In the mean time the UK housing market is doom to repeat the “Irish property bubble” at some point in the near future. With covid deaths standing at over 100k just in the UK, housing markets maybe flooded with desperate sellers dumping probate properties.4 July, 2021 at 8:21 am #1140681
a crust short of a loaf4 July, 2021 at 8:28 am #1140683
Fishy you have no idea what you are on about4 July, 2021 at 8:43 am #1140684
house prices will always rise as demand due to population increases always outstrips supply. there will be a time when sizes of home are restricted eg flats and when food rationing comes in ( eventually due to world demand to feed its billions) family growth might be stifled .eg no support for breeding . sea change but too late to affect house prices now. investors will alway s push up prices anyway. many buy housing purely for income streams as as they get richer they buy still more ..you try seeing what interest you get on say £500.000 in savings versus owing a property for same value in right area ! you can understand why so many want to buy! if we had a system that prevented anybody ( private or business but not pension funds) owning more than say 4 homes.. and stopped population expansion by removing rewards for breeding..we might start to see prices stabilise and even reduce.
1 member liked this post.4 July, 2021 at 10:04 am #1140687
OK, I’m going to take the key points from that and answer them one by one.
Population increases always outstrips supply
Kind of…. in the next few years more and more “baby boomers” will entre retirement homes or pass away. Making up around 21% (14 million) of the UK population and mostly home owners, the UK receives a steady stream of housing coming on to the market. In the end its between 5-7 million property’s coming onto the market in the next 20 years.
Family growth might be stifled .eg no support for breeding .
The idea of a poor family receiving benefits buying there own home is unrealistic. If they had the money to buy a house, they wouldn’t any government help.
Investors will alway s push up prices anyway. many buy housing purely for income streams as as they get richer they buy still more.
The government have step in here increasing taxation on buy to let properties.
You try seeing what interest you get on say £500.000 in savings versus owing a property for same value in right area !
Investments can go down as well as up. Property can be a risky investment. The Irish property bubble showed how badly things can go wrong with the housings market. I have a friend who’s home is now worth less than he paid for it in 1999 thanks a new infrastructure passing within 200 meters of his home. Japanese knot weed is still spreading wiping thousands off property prices each year and more homes keep failing into the sea or suffer from flooding.
If we had a system that prevented anybody ( private or business but not pension funds) owning more than say 4 homes
Are you calling for an end to social housing? Councils and housing associations are the biggest property owners within the UK. Charity are next just look at the salvation army income figures from a few years ago.
Most of the big business landlord’s are insurant company’s and rent out retail space not homes. Shopping centres and office blocks. Standard Life Investments owns my local shopping centre here in Brighton as well Brent Cross in London.4 July, 2021 at 10:05 am #1140688
Bed sit boys talking property high finance 😂4 July, 2021 at 10:36 am #1140689
who gets a bus to work 🤣🤣🤣🤣🤣🤣🤣🤣4 July, 2021 at 10:37 am #1140690
The primary driver of prices, not physical supply and demand.
That’s how prices work.4 July, 2021 at 10:40 am #11406914 July, 2021 at 11:03 am #1140692
The primary driver of prices, not physical supply and demand.
That’s how prices work.
Not with the housing market, its what people can afford to borrow and the size of there deposits. If you go on any mortgage calculator website its terrifying how much people can borrow with little or no deposit. Whole life mortgages means they can borrow a lot more too.