Big time Posted September 29, 2011 Share Posted September 29, 2011 Reading this post http://www.sheffieldforum.co.uk/showpost.php?p=6032083&postcount=121 in another thread prompted me to start this thread. I think Mr mossdog made a good point there. Link to comment Share on other sites More sharing options...
blades89 Posted September 29, 2011 Share Posted September 29, 2011 Reading this post http://www.sheffieldforum.co.uk/showpost.php?p=6032083&postcount=121 in another thread prompted me to start this thread. I think Mr mossdog made a good point there. Are you assuming the people who work under these conditions will be homeless? If you consider £3 an hour x 35 hours = £105 a week. £105 x 4 = £420 a month. That person would just about be able to afford the very cheapest rent/bedsit. With any money left over, they would have to pay council tax + pay bus fare to get to work. Also, not forgetting that this person I'm assuming will need to eat food, then to me its a non starter If they went for a mortgage, then your £3 an hour over 36 hours = around £5600 a year. £5600 x 3 times your wages = a mortgage potential of £19,600. Not many houses available for £20,000 these days Link to comment Share on other sites More sharing options...
chem1st Posted September 29, 2011 Share Posted September 29, 2011 Are you assuming the people who work under these conditions will be homeless? If you consider £3 an hour x 35 hours = £105 a week. £105 x 4 = £420 a month. That person would just about be able to afford the very cheapest rent/bedsit. With any money left over, they would have to pay council tax + pay bus fare to get to work. Also, not forgetting that this person I'm assuming will need to eat food, then to me its a non starter If they went for a mortgage, then your £3 an hour over 36 hours = around £5600 a year. £5600 x 3 times your wages = a mortgage potential of £19,600. Not many houses available for £20,000 these days You can get more than £20000 a year in housing benefit if you live in London. Keeps the property prices high, and the landlords with a nice income. Forces the rent up to such a degree that the young people cannot compete with housing benefit, even to rent! Yet alone save up a deposit. Link to comment Share on other sites More sharing options...
Big time Posted September 29, 2011 Author Share Posted September 29, 2011 Are you assuming the people who work under these conditions will be homeless? If you consider £3 an hour x 35 hours = £105 a week. £105 x 4 = £420 a month. That person would just about be able to afford the very cheapest rent/bedsit. With any money left over, they would have to pay council tax + pay bus fare to get to work. Also, not forgetting that this person I'm assuming will need to eat food, then to me its a non starter If they went for a mortgage, then your £3 an hour over 36 hours = around £5600 a year. £5600 x 3 times your wages = a mortgage potential of £19,600. Not many houses available for £20,000 these days The government could, lets say, "encourage" morgage lenders and landlords etc, to be a bit more realistic with their pricing. Link to comment Share on other sites More sharing options...
chem1st Posted September 29, 2011 Share Posted September 29, 2011 The government could, lets say, "encourage" morgage lenders and landlords etc, to be a bit more realistic with their pricing. Landlords buy housing based upon the mortgage rate and rental yield. The minimum rental yield is determined by the maximum housing benefit payable for that property. Mortgage rates are at a record low. A 2 bed house will yield £104 a week in Sheffield. £5408 a year. That's over half of somebodies wage who works full time for minimum wage. Landlords have been profiting massively out of this arrangement. Property prices have been kept artificially high. Link to comment Share on other sites More sharing options...
blades89 Posted September 29, 2011 Share Posted September 29, 2011 The government could, lets say, "encourage" morgage lenders and landlords etc, to be a bit more realistic with their pricing. Its not going to happen. For example, if landlords were in a position to charge £800 a month due to how the benefits system works, do you think they will charge £400 a month as a means of being good to society, or will the charge the full rental value? With the population predicted to go up in the millions through mass immigration + not enough houses being built, the rental market is only going to increase. Give it 10 years, and going to work for a young person simply is not going to be a career option Link to comment Share on other sites More sharing options...
chem1st Posted September 29, 2011 Share Posted September 29, 2011 Its not going to happen. For example, if landlords were in a position to charge £800 a month due to how the benefits system works, do you think they will charge £400 a month as a means of being good to society, or will the charge the full rental value? With the population predicted to go up in the millions through mass immigration + not enough houses being built, the rental market is only going to increase. Give it 10 years, and going to work for a young person simply is not going to be a career option Housing benefit is forcing up rents. housing benefit forces up house prices. If a 2bed house yields £5408, and costs £100000, then that's a 5.408% yield. (Far higher than what you will get in a bank) Yet to qualify for a £5408 mortgage, one would need a salary of £30k. I.e. you'd have to be in the top 20% of earners. A 2bed house, shouldn't cost more than £30k. Lax lending let prices explode, but housing benefit keeps them propped up. Yet to build a deposit, you hav to break through the housing benefit barrier. It's a subsidy for landlords. These property owners are being kept rich. And the youth are denied access to social housing, as it has been sold off and knocked down. Forced to rent, and forced to pay more than they should in a free market. Link to comment Share on other sites More sharing options...
fruitisbad Posted September 29, 2011 Share Posted September 29, 2011 raising the minimum wage might encourage people to stop living off the dole and cut the benefit bill Link to comment Share on other sites More sharing options...
Mecky Posted September 30, 2011 Share Posted September 30, 2011 Yawwwwn here we go again. Some people never learn do they? Link to comment Share on other sites More sharing options...
Ms Macbeth Posted September 30, 2011 Share Posted September 30, 2011 Landlords buy housing based upon the mortgage rate and rental yield. The minimum rental yield is determined by the maximum housing benefit payable for that property. Mortgage rates are at a record low. A 2 bed house will yield £104 a week in Sheffield. £5408 a year. That's over half of somebodies wage who works full time for minimum wage. Landlords have been profiting massively out of this arrangement. Property prices have been kept artificially high. You don't seem to have realised that some small BTL landlords have lost money, and sometimes their properties when mortgage rates were high. Some find it difficult to get tenants who stick to their side of a rental agreement too. If someone had worked hard, managed to save some money and bought property as an investment for retirement they could end up with nothing. Any investment can go wrong. It is difficult to find accommodation on low wages, but if I was single and only earning a small wage, I wouldn't expect to have a 2 bedroomed house. I'd expect to have a small flat or bedsit or share a house, like students and young professionals do. The running costs would be less as well. A couple, both on minimum wage could afford the rent of a two bedroomed house. If we are talking about people in work, then surely the idea is to start with what they can afford, and aim higher? On the other hand, some housing associations see low incomes (both in and out of work) as one of the priorities for housing. Perhaps local authorities should follow suit? We need to match expectation to reality I think, just like my generation did. The only difference is I'd expect all properties nowadays to have bathrooms. I wouldn't abolish the minimum wage, but I would increase the basic income tax thresholds to match it. Link to comment Share on other sites More sharing options...
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