Should council house rents be at normal market value?

[Cyclone]

how many people in this country need social housing ?how many people need housing/council tax benefit ? i bet the figures outweigh the well off people who these things will not apply to them and dont care what happens to the people it will affect. (ring any bells:loopy:) you keep spouting off what you believe you think is right and ill do the same

 

If you could try to make sense when sharing your opinions though it would help...

[Cyclone]

Why would there be no profit in it anymore? People would still want to buy and renovate houses. Builders and architects getting paid at the going market rate is not the same as speculating. You seem to imagine that peoople would choose to live in the street without the intervention of property speculators.

I was talking about new builds, and there is no going market rate if it isn't a free market which seemed to be what you were advocating.

 

 

On the contrary, I think it's you who doesn't understand the housing market if you believe prices set by the forecastes and guesses of speculaters are representative of the true value. A price driven by the factor of the 'real' value of a house would not fluctuate wildly.

there is no ' real' apart from what someone will pay

 

Housing should be protected from the pressures which are put on non essential commodities, because if the price of sofas gets pushed through the roof by speculatiion, people will stop buying them. When the price of houses get too high to be affordable by the majority, people are forced to rent at inflated prices. They can't stop living in a house, in the same manner they might choose not to buy an over-pricesd sofa! In thse circumstances our housing stock is no longer serving the primary function of providing affordable housing.

That wad never a function of housing, unless you were in a communist state.

[donkey]

I was talking about new builds, and there is no going market rate if it isn't a free market which seemed to be what you were advocating. there is no ' real' apart from what someone will pay

That wad never a function of housing, unless you were in a communist state.

 

Going market rate for the labour.. What i am talking about is protecting the actual houses from the pressures of speculation through regulation. This is done with water, public transport and various other essential services. Our Health care and education are not left for the prices to be fixed by the open market. That's hardly communism. In what way is the right to have affordable housing any less essential than affordable education and health care?

[donkey]

there is no ' real' apart from what someone will pay

 

Really, so the controlled prices of bus and train travel aren't 'real.' If measures were put in place to take massive taxes from the profits on houses if they are re-sold within five years, and regulating rents so they could never exceed a certain percentage of the mortgageable value of the house, you would soon see stable and reasonable house prices where more people could afford to buy, and those who remained unable to do so would have cheaper rents, thus minimising the need for social housing.

 

If people are making money from speculating on housing, it means somebody somewhere has to be paying for it through increased housing costs. The only alternative is that the profit has appeared from thin air. The argument that houses will not be built without the intervention of speculators is pure nonsense. You speak of the market 'regulating itself' as if that's all hunky dory. the Credit crunch is an example of the market regulating itself, and it was also a direct result of speculation by the banks. If they hadn't been betting on the expectation of continuing house price rises, they would not have been giving mortgages to all and sundry in the US. A lot of people make a lot of money from property speculation, but in the long run, it causes a lot more people hardship. This seems pretty obvious to me, especially at this moment in history.

 

I

That wad never a function of housing, unless you were in a communist state.

 

How do you come to that conclusion?

[Tony]

donkey, what do you mean by 'speculators'? Anyone fitting that profile is a tiny part of the housing market, and I mean so tiny as to have negligible if any impact.

 

Bus and train prices aren't controlled, in fact they are the polar opposite - they are subsidised. Healthcare is hugely expensive in the UK and the workers in it are handsomely paid far more than equivalently qualified people.

 

I'm really not sure where you are coming from with house prices apart from some notion of 'it's not fair'. Supply and demand provides the market and the OP is an attempt to discover ideas around the implications of equalising the various sectors of the market.

[Tony]

I'd have to challenge that.

 

If you take, say, a 3 bedroom detached house in a nice part of town, worth around £300k, the build cost would be about £100k - the rest is the cost of the plot.

 

I suppose that changes if the plot is in scumsville somewhere.

£100k would be wishful thinking but on the general point it's supply and demand at work again. In some places the land value would struggle to get past 5% of the final property sale price.

 

Don't think that people wouldn't want to live in places just because you wouldn't. Demand is huge in some of the most down at heel locations because people still want to live near family and friends. It may not be your cup of tea but they still have aspirations to do a little better, buy their own place, work their way up in the world and that brand new two bed semi down the road from mum's for £120k is just the ticket and the mechanic and his admin worker girlfriend can get a mortgage for it.

 

The same principles could work for social housing if rents reflected the true value. I rather like the idea of social engineering through giving people a choice and a leg up rather than giving them a handout and a crap house with crap neighbours for a pittance rent.

[Cyclone]

Going market rate for the labour.. What i am talking about is protecting the actual houses from the pressures of speculation through regulation. This is done with water, public transport and various other essential services. Our Health care and education are not left for the prices to be fixed by the open market. That's hardly communism. In what way is the right to have affordable housing any less essential than affordable education and health care?

 

The nhs and education are not private commodities but state provided services, hardly comparable.

[Cyclone]

You need to phone first and ask who decides what fare they charge...

[Cyclone]

The one point that donkey skims by but doesn't actually make is that better regulation of the mortgage market would have avoided the housing bubble as it was created by the over availability of cheap credit. Since banks can't be trusted to be sensible this market does need regulating. Trying to directly regulate house prices would be perverse and probably impossible.

[Tony]

And it's a good point too. As I've mentioned innumerable times, if it were simply illegal for loans to exceed value the bubble would not have been created.

 

On the other hand, if people didn't ask for such loans...