Be prepared

[pipme]

Eventually there will be a third human 'need' beyond 'sustenance' and 'shelter' maybe that of 'future life' ..... It is gonna cost !!

??

I wonder about reliance on property to make pension dosh, HMG have maintained a thread, recently, with regards to first time buyers .. thereby putting this in our minds. Now there appears to be a move to help them, via state aid .. Ok, many of us have children and first time buying is a concern.
HMG, however, have not mentioned funding .... Is this another of their carefully crafted plans .. With the cruncher to follow !!
How to fund help for the first timer ? Perhaps VAT at some percentage - between 0 and 17.5% maybe applicable after two or so private sales by individual - co-habitees ??
Sooner or later the potential revenue will be tapped ... Imagine Gordo slavering over all that equity in property, eventually falling, unearned into the seller's pocket before he / she skiddadles to warmer, cheaper climes .. Somehow some way Gordo'll be after it !!

Hey up, Mon morn Gordo says ... "...cost of 'buying' help £1 billion..." Wait for it.. the source will follow in the small print .. So that is £3 billion to EU plus £1Billion to help boost property prices £4B / 30Mil = £133 per head of working pop per annum .. and this is just the beginning.
News on energy, gas to rise min 10% .. Apparently EuroPlaces having state owned gas.. not prepared to sell other than expensively to Brit competitive market ... 6 yrs before we get access to cheaper gas .. long enough for the snouters to up the cost til our pip sqeaks !!
So much for privateering and competition in gas provision .. another rip off.

 

[Damocles]

You can not buy yourself out of the present property crisis. Mortgage tax relief was abandoned because it became utterly pointless. the idea was to allow people some extra dosh to help them buy houses. The result was that if they had say £5000 extra (long time ago) then the price of every single house went up by £5000. This was exactly demonstrated when the government used a pretty stupid method of abolishing the relief, and all the house prices fell by £5000 overnight.

The price of houses right now depends on how much people can afford to pay. Nothing to do with the cost of building. Nothing to do with intrinsic value. Everything to do with the fact that there are more people wanting to buy one than there are houses to buy. So the people who get left out are the ones with least money.

If the government introduces any kind of scheme which subsidises houses all this will do is make that group of people more able to buy. Someone else will then not be able to buy, and the price will be pushed up even more. Then the government will have to increase its subsidy......

There is only one way out of this. Build as many houses as are needed.

What would happen, maybe will happen, if the government announces a cap on new cars in this country? Do you think that perhaps those old bangers which right now you can not give away will suddenly get more and more valuable? Yep.

 

[pipme]

Like it or lump it this has to be paid for .....

....Brown unveils cheap mortgage plan
The government would have a share in the equity of the house
More than 100,000 homeowners could get onto the property ladder in the next five years thanks to a part-ownership plan, Chancellor Gordon Brown has said.
Buyers would have to raise as little as half the cost of homes sold on the open market, he said.
The remaining equity in the house would be shared by the government and the bank or building society.
Mr Brown said he thought the scheme could help see two million more people owning homes compared to 1997.
"We've created stability in this country, and we must ensure that the benefits go particularly to young couples who want to own their own homes, who've found that house prices have been high...."

http://news.bbc.co.uk/1/hi/uk_politics/4570045.stm

I fully favour control of borrowing, the banks IMHO are having a field day handing out loans with impunity ... Less able people are losing their lives over it !! ... Lack of housing, easy loans, results in the private business of multi home owning ... not all of which could be resolved using equity if the banks called in the loans ... Which BTW they can do at any time ... I believed that was why Building Societies thrived ... Guess people just do not realise what a nasty bedfellow 'The Bank' can be ...

 

[Damocles]

Do remember that ther are rather a lot of people now supposedly fiddling their income figures to get mortgages, because they see the soaring price of property and reckon it is the only way to go.

So Mr Brown has a scheme where you can buy 50% of a house if you can not afford all of it. So in 20 years he will be selling 25%, in 40 years people will only be able to afford 10%? Not a solution. Just encouraging price inflation.

 

[pipme]

Control of borrowing ... would help bring the prices down. Perhaps the chance for that has passed by may do more financial harm than good .. Labour has fueled the short term 'feel good factor'.... with little thought for the future.

 

[TexMex]

It's the same as any market place. The laws of supply and Demand will ultimately set the prices. The main problem we have in this country is obstructive planning policies.

I recall seeing a report that we are heading for problems due to the migration of our population into the cities. Isn't this another symptom of the same issue.

The only reason that our population is heading for the cities, is because that's the only place you can get planning to build. Even then, it's like pulling teeth.

It's all well and good having lots of lovely green space, but when it's at the expense of having affordable housing it's a luxury we can ill afford.

Obviously the likes of the Lake district, Epping Forest and other areas of natural beauty or scientific interest need to be protected but there is stacks of redundant farm land in, what can only be described as, areas of natural ugliness (Rainham, Essex springs to mind).

If we could only get planning permission to build on this sort of land, supply of housing could go up, pushing prices back down to acceptable values, and the poor beleguered farmers could sell off thier redundant land to pull them back from the brink of poverty.

 

[pipme]

Money is easy to come by, not so easy to repay, therefore the effect of the lack of building land is magnified....
If loads more land made available, will big conglomerates will buy it up and keep the prices buoyant ?
I believe control of the dosh as in loans is also important ... But may not come about because the Banks are making a right killing on loans etc. ... Relatively easy today to obtain several mortgages - buy to let - Was not so easy in days gone by.

So I guess we wait for the inevitable slump ... many houses of cards will then collapse.
P

 

[oilman]

There will be no help for first time or any other buyer. The help will be for the benefit of builders and lenders.

People do not pay what they can afford for houses nowadays, they lie and stretch themselves beyond affordability, then everyone moans when things go wrong.

.......areas of natural ugliness (Rainham, Essex springs to mind).

If we could only get planning permission to build on this sort of land, supply of housing could go up, pushing prices back down to acceptable values, and the poor beleguered farmers could sell off thier redundant land .......

You may see Rainham as ugly, that is only an opinion, building houses all over anywhere, makes the place ugly in MY opinion.

Prices will not go down to "acceptable levels" while it benefits the builders and lenders to ensure things are otherwise.

What IS this stupid thing called a "property ladder"? It's more like a ball and chain or a millstone round your neck. Germany does not have everyone owning their own house.

 

[pipme]

... Last year Britain's four biggest banks between them made profits of £23.3 billion ($43 billion), a 16% return on equity. About £6.7 billion of that came from their retail banking operations in Britain....

Of course investors in the bank had a great return too ... or did they ? I do not consider my paltry few Barclays or HBOS shares returned anything near 16% .. Ok, they were better than a high int savings account .. but only just .. With the certainty of capital losses in a downturn ...
When will the rip ever end ? Roll on evacuation day !!

Oilman is right it is crazy.
In all honesty tis a cottage industry which does not pay it's due share of taxes ...

 

[AdamW]

So the people who get left out are the ones with least money.

In many cases, but many of my friends haven't bought because their expectations are too great. They don't want to enter the ladder at the bottom, but they can't afford to enter it at the middle. In the end they don't bother and just talk about "when the prices crash" as if saying it will make it true.

Due to mortgage restrictions, it is possible to rent a better place than you can pay the mortgage on. Say you earn £20,000 a year. A 4-times mortgage means you could buy something worth £80,000. But, perhaps your lifestyle is such that you could actually afford to repay twice what that mortgage would cost per month.

Round here, I have plenty of friends who can afford to buy a 1-bed flat but instead choose to rent a 2-bed semi.

 

[TexMex]

You may see Rainham as ugly, that is only an opinion, building houses all over anywhere, makes the place ugly in MY opinion.

You obviously havn't driven through Rainham
Even if you had, and just fell in love with the place I would argue that, the housing needs of the locals, should take priority over the aesthetic sensitivities of the casual passers by.

Anyone that misses the peculiar appeal of the Rainham landscape could visit thier nearest landfill tip, at thier convenience. There's no need to deny affordable housing to maintain this sort of vista.

 

[oilman]

........ the housing needs of the locals,........

But is the housing used by locals? Take Cambourne near Cambridge, people have moved in from far and wide. This house building is done by builders, who grab as much money as they can. Do you know any poor property developers?

 

[TexMex]

Do you know any poor property developers?

Point taken. But to be fair, they have to cover the costs of all those greasy handshakes.

Wouldn't it be nice, if the average man in the street could, buy a plot of land, apply for planning permission and get it. It's surprising how often perfectly sound planning applications are turned down, yet other less desirable projects, seem to be passed, simply because they are being proposed by known developers.

For example.
A recent planning application around here was proposed to build a terrace of four 2 bedroom houses on a derelict site of lock up garages. This was in a residential area. The reason given was that the development would spoil the appearance of the area.

Simultaneously, a development of four detatched 4 bedroom houses was allowed on green belt land, despite strong opposition from the public.

The first project was proposed by a syndicate of local residents. The second was by a very large developer. Bearing in mind the governments guide lines to encourage the building of affordable housing, you have to wonder what is going on here.

 

[david and julie]

Not against this in principal but there could be a legal issue here. The fat controller today said they would free up unused public land and sell it off cheap for these houses.

Some years ago a friend of mine wanted a piece of land next door to expand his business, the land belonged to the local authority and was put up for auction as it wasn't being used. A few days before the auction it was withdrawn from sale having been sold by private treaty. This buyer turned out to be another quasi public body who had bought the land for a very lowly sum, just to make it legal.

He sued the council on the grounds of a failure to get the highest ammount they could for surplus public assets, which was a legal requirement. The council backed down before the case and put the land back up for auction, he subsequently bought and still owns the land.

This is why surplus public assets, such as land, are normally auctioned in the first place. John Prescott may mean well, but would actually be disposing of public assets below their true market value and would therefore be wasting public funds. I can't see why this would be any different than the above case.

 

[Damocles]

Obviously he would be disposing of assets below their market value. the policy is pointless unless he does that. The argument is supposedly that there is no land cheap enough to allow building of affordable houses.

So in fact, if he is actually selling the land at full value, then this is not a real scheme at all.

My own bugbear is this business of despoiling the countryside. Our council has a policy that you may not take some eyesore of a farm building and change it into a house UNLESS it is already of special architectural significance. If it is pretty enough, you can keep it exactly as it is. If it is some massive wharehouse or pile of concrete and tin then you are not allowed to do anything except leave it exactly as it is. You are not even allowed to tidy up the countryside using the money from development.

But it is total rubbish to say that no building should be permitted even where the countryside is a picture postcard landscape. I am not talking about turning it into acres of buildings. But it really is possible to add in houses where no one could even see them. Never mind the fact that a view almost always looks better for having some development . How many landscape paintings do not have some sort of building in them? A LOT of houses could be slipped in this way and it would actually improve the economy of the countryside.