MrSmith Posted April 1, 2013 Share Posted April 1, 2013 Well Smithy, you do have a choice, bet the prices will go up significantly, or don't bet at all. I'm betting they will go up and I'm going all in. 12 years from now, 1983 detached house £25,000 2013 house now worth £ 144,000 which is 6% growth per year. 2033 same rate of growth £825,000 1983 average wage £7,700 2013 average wage £26,500 which is 4% 2033 at same rate of growth £ 81,000 Assuming wages and houses grow by the same rate as the last 30 years, in another 30 years it will take 10 times average wage to buy an average house, instead of 3 times average wage. 20% deposit will be £165,000 and mortgage payments at 3% will be £37500, at 4% £41000, 5% £46,300, so either wages have to grow faster, interest rates have to fall further or houses prices can’t increase by the same rate as the past 30 years. Link to comment Share on other sites More sharing options...
El Cid Posted April 1, 2013 Share Posted April 1, 2013 Your posts consistently contain mistakes,but you keep posting without reflecting on the errors. You just need to think a little more, of course I know the Government already have a stake in some banks. Link to comment Share on other sites More sharing options...
I1L2T3 Posted April 1, 2013 Share Posted April 1, 2013 Some are predicting a surge in house prices because of the government's housing policies. The Tories want another housing bubble. Gordon did well off one so why shouldn't they? http://www.dailymail.co.uk/news/article-2302056/House-prices-overtake-pre-crisis-peak-year-thanks-governments-new-help-buy-scheme.html Link to comment Share on other sites More sharing options...
Cyclone Posted April 1, 2013 Share Posted April 1, 2013 http://england.shelter.org.uk/news/march_2013/sharp_rise_in_number_of_homeless_families Homelessness continues to rise. Building remains low. Demand for housing continues to exceed supply. Due to a lack of housing to meet demand, housing costs are forced upwards, and the poorest are no longer able to access housing. This is brilliant news for homeowners, but bad news for the poor. Increasing amounts of children, along with adults are being made homeless. NIMBYs oppose new housing development, they often oppose it because they fear it could reduce housing prices and rents and in turn lead to people being able to access housing. This would substantially reduce the price of their property. By definition a NIMBY doesn't oppose it for those reasons. They only care if it's close to them, hence the IMBY bit of the acronym. Increasing amounts of homelessness show that NIMBYs are winning the war. With a lack of housing, they can command a premium for their properties. So whilst increasing amounts of British children are having a terrible time, having their lives and future prospects ruined, it isn't all bad news. For some wealthy homeowners are financially better off. These people might already be rich, but now they are even richer. They have nothing extra to show for it, but they can brag about their house and it's new higher worth. Most NIMBYs are by no means rich either. The recent budget offered nothing to the poor, it will not reduce child homelessness. It did however offer a big subsidy to home-owners. The government is going to guarantee mortgages and push house prices even higher. Reduced taxation for the low paid. Something for the poor. So whilst young children are made homeless, old people who could access affordable housing in their youth, can rejoice, that such housing will now increase in value further. And let's face it, homeless children don't vote, whilst old homeowners do. And whilst I personally despise NIMBY homeowners who having managed to secure a roof over their head, now actively campaign to stop others being able to do so. I must acknowledge that they are winning the battle. Well done NIMBYs! You are winning! Pat yourselves on the back! Sorry homeless children, you are losing! Unfortunately the state does not deem you to be of value. Increasing house prices is a greater priority. This is the UK, and you were not born into property wealth, your life chances are poor and your future is bleak, you have my sympathy. Well done for blaming a non existent group of people for all the woes of getting planning permission in the UK. ---------- Post added 01-04-2013 at 10:24 ---------- Birth rates have been below replacement rate for over 40 years. We are in the longest baby bust in the history of our nation. We are supposedly wealthier than we ever have been. We are not havng enough children, and people are supposedly in a position to have 10+ each! Don't you ever read the news? In 2011 there were 688,120 babies born in England, the highest number since 1971, official figures show. The RCM says a big issue is the country's rising birth rate - which is up by more than 124,000 since 2001. In some parts of England, the birth rate has jumped more than 50% in recent years. http://www.bbc.co.uk/news/health-21120593 Link to comment Share on other sites More sharing options...
MrSmith Posted April 1, 2013 Share Posted April 1, 2013 Some are predicting a surge in house prices because of the government's housing policies. The Tories want another housing bubble. Gordon did well off one so why shouldn't they? http://www.dailymail.co.uk/news/article-2302056/House-prices-overtake-pre-crisis-peak-year-thanks-governments-new-help-buy-scheme.html They have given the bank of England the authority to pull the plug if it pushes prices up instead of encouraging more building. Buy to let is not such a good investment at the moment, mortgages are harder to get and interest rates are higher than for first time buyers, some Buy to let are being forced to make their stock more energy efficient and rents for benefits claimant have been capped, government policy appears to be discouraging buy to let, whilst making it easier for first time buyer, more first time buyers means fewer people renting. If they get it right they should be able to get first time buyer buying and builders building without forcing up prices. Link to comment Share on other sites More sharing options...
I1L2T3 Posted April 1, 2013 Share Posted April 1, 2013 They have given the bank of England the authority to pull the plug if it pushes prices up instead of encouraging more building. Buy to let is not such a good investment at the moment, mortgages are harder to get and interest rates are higher than for first time buyers, some Buy to let are being forced to make their stock more energy efficient and rents for benefits claimant have been capped, government policy appears to be discouraging buy to let, whilst making it easier for first time buyer, more first time buyers means fewer people renting. If they get it right they should be able to get first time buyer buying and builders building without forcing up prices. Time will tell. You're one if the few people I know of that thinks the gpvernment becoming a guarantor of sub-prime lending is a good idea. Link to comment Share on other sites More sharing options...
MrSmith Posted April 1, 2013 Share Posted April 1, 2013 Time will tell. You're one if the few people I know of that thinks the gpvernment becoming a guarantor of sub-prime lending is a good idea. I didn't say it was a good idea and I wouldn't have done it, but what I do know is that without house sales the country won't have economic growth and people are calling for growth. The economic growth of the last government came from an housing bubble and it appears to be what many people want. Link to comment Share on other sites More sharing options...
I1L2T3 Posted April 1, 2013 Share Posted April 1, 2013 I didn't say it was a good idea and I wouldn't have done it, but what I do know is that without house sales the country won't have economic growth and people are calling for growth. The economic growth of the last government came from an housing bubble and it appears to be what many people want. House building will deliver growth through boosing the construction sector and increasing GDP. Increased supply would reduce prices freeing up more of peoples' income for discretionary spend. Increased supply would lower rents allowing the housing benefits bill to reduce. But I'm puzzled by your answer. How does sales of already existing housing stock deliver growth? Without increased supply at best more house sales is simply an indicator of confidence in the economy. The government's policies will most likely increase sales but it's a false indicator. It wouldn't happen without government guarantees. Unless more homes are built quickly the increased demand the guarantees create will push up prices. If the Bof E have to pull the plug the policy will be dead before it really gets going. Best just to invest in building the social housing we know we need. Link to comment Share on other sites More sharing options...
MrSmith Posted April 1, 2013 Share Posted April 1, 2013 House building will deliver growth through boosing the construction sector and increasing GDP. Increased supply would reduce prices freeing up more of peoples' income for discretionary spend. Increased supply would lower rents allowing the housing benefits bill to reduce. You mean like Spain and Ireland did, they build loads of houses and the housing market crashed taking their economies with them. But I'm puzzled by your answer. How does sales of already existing housing stock deliver growth? Without increased supply at best more house sales is simply an indicator of confidence in the economy. People that buy houses also buy stuff to put in them, and when house prices are growing people feel wealthier so are prepared to borrow money to spend on luxury items. The government's policies will most likely increase sales but it's a false indicator. It wouldn't happen without government guarantees. Unless more homes are built quickly the increased demand the guarantees create will push up prices. If the Bof E have to pull the plug the policy will be dead before it really gets going. I agree, it’s a fine line they are walking; I would have only included new build in the policy. Link to comment Share on other sites More sharing options...
I1L2T3 Posted April 1, 2013 Share Posted April 1, 2013 You mean like Spain and Ireland did, they build loads of houses and the housing market crashed taking their economies with them. No I don't mean that at all. People that buy houses also buy stuff to put in them, and when house prices are growing people feel wealthier so are prepared to borrow money to spend on luxury items. That's what fuelled the last consumer debt bubble. The one you hate. I agree, it’s a fine line they are walking; I would have only included new build in the policy. I think we all know it won't really work. I haven't seen any serious economic commentators say anything good about it. Link to comment Share on other sites More sharing options...
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