The problem with that where i live is that many high up members of are government own multi houses & flats and doesn't want to see there prices drop
House prices rose 7.3% this year, average now almost £250k
- Thread starter HACO
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Yes I fully trust that the government will protect the housing market. We can't have millions of people going into negative equity, can we? Especially not now when being homeless is a serious threat with the virus.
Like others have said, money is cheap at the moment so houses get snapped up quickly by BTL investors who then rent them easily.
Also councils need to house people on benefits and they often go into private rented accommodation. So a family that became homeless, simply becomes a family in BTL being paid for by the state.
Like others have said, money is cheap at the moment so houses get snapped up quickly by BTL investors who then rent them easily.
Also councils need to house people on benefits and they often go into private rented accommodation. So a family that became homeless, simply becomes a family in BTL being paid for by the state.
We got quite excited by some new builds near us yesterday..
Affordable - check
Part own available - check
Over 55 development -:dammit
It's like the 5th or 6th retirement development to go up around here in the last 2 years. I haven't seen any substantial "normal" housing, the occasional 2-3 plot luxury houses pop up here and there.
Believe it not but the government does seem interested in building lots of homes. Most Local Authorities do not. I’ve worked on dozens of the largest new housing schemes across the country in the last 10 years. They almost all were rejected by the Local Authority and a planning appeal was lodged with the Planning Inspectorate who overturns the Local authority decision.
People don’t want new homes built near them.
People don’t want new homes built near them.
Caporegime
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The problem with that where i live is that many high up members of are government own multi houses & flats and doesn't want to see there prices drop
Nobody wants to see them drop apart from people who don't own a house.
It's not just members of the government. That's just rubbish. Everyone who owns a house doesn't want the price to fall.
Also y building more houses in area X doesn't mean houses in area Y will fall in price.
People need to start relocating to where there is cheaper housing if they cannot afford to live in area Z of the country.
I was about to buy a house just as covid kicked off, but pulled out just before signing due to being put at risk of redundancy. I was about to buy for 166k which was getting to the top of my budget. That same house sold last month for 175k. I'm being priced out before my eyes.
But in a way that's good because they will be downsizing, and you can buy their properties.
Your wrong there as i know multi people that own there houses and still want to see the prices drop big time
Reason being is there no way there children can afford to get on the housing ladder or afford the very high rent prices
I'm sure there are people who own a house, and want to move up the ladder, who'd like to see a drop. The cost of doing so would be less.
If you own a house outright, yes. If you have a mortgage on the house then it doesn't always work out like that.
For example, if you have a house currently valued at £250k with £175k outstanding mortgage and you want to buy a £500k house:
-House prices stay the same. You sell for £250k, pay off the remaining £175k on your mortgage and you've got £75k deposit for the 500k house (still valued at 500K) which is 15% deposit
-House prices drop 20%. You sell for £200k, pay off the remaining £175 on your mortgage and you've got £25k deposit for the £500k house which is now valued at £400k so you've got 6.25% deposit.
Central London has actually gone down by 1-2% this year, and has been stagnant for the last few years.
Believe it or not, the government doesn't answer to local authorities. They can easily change regulations so that local authorities can't stop building.
The NIMBY attitude in this country has to change.
If you own a home and want to upsize, you benefit from a drop.
If you own a home and don't want to sell/borrow against it and you're not heavily margined, you don't suffer from a drop in prices.
If you own a massive portfolio of properties, all bought on margin and you're in debt up to your eyeballs, then yes, you don't want a drop.
Guess what percent of the country are the third group? Likely less than 1%. But maybe 99% has to suffer so that the 1% richest can continue to be the richest.
Sadly, important people in government and our MPs and their families have those huge portfolios. So they're not going to act against their own self-interest.
Yeah. Ever-rising prices hurts everyone except the mega landlords and HNW property investors.
First case, you need to borrow £425k
Second case, you need to borrow £375k
Second case is still better for you. Yes you have a smaller deposit, but you also need to pay off a lot less. You're not disadvantaged in any way. And you pay less stamp duty as well.
Caporegime
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Problem is those children want th exact same house as their parents.
Same area. Same size. Same price they paid.
I know someone who moved out of their parents £780k home into a house which was probably around £78k at the time.
They stayed there and saved and then eventually moved on to a £300k property.
The area they moved to was a dump. After living in essentially a castle in the best area of the city. They were now in a tiny semi detached house where the surroundings I wouldn't dream of going for a walk in.
Nobody wants to make any sacrifices or compromises any more.
Put it this way said parents house was 6 bedrooms. All the rooms were massive with 15 foot high ceilings. They could have easily stayed there but actively chose to move out into a dump to get on the ladder.
A lot of the parents and kids are to blame also. As soon as they started working parents should have been pushing them to save and invest it making them pay £250 a week digs which they then invested for them.
Again I know someone who's parents invested in a flat as soon as they went to uni. Let it out then after uni was over and they had a job gave them the flat. So all they did was out down a deposit and let the tennents pay off equity for 5 years before handing it over in a much better position.
Parents saying they want house prices to fall simply for their kids to be able to afford a house like theirs need to get a grip on reality. House prices are never going back to what they were in the 70's, 80's or 90's.
The best you can hope for is a 20% drop next year when the government stop propping up wages. Anything more than that then homes will simply be burned to the ground.
You've also got a £375k mortgage instead of a £425k mortgage.
Anyway, even if it doesn't work out for the best on every occassion the statement "Nobody wants to see them drop apart from people who don't own a house." is clearly false.
Caporegime
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Not if they are invested in the market elsewhere like rental properties, etc.
I'd like to see a drop in your scenario. I'm now in a position where my equity is more than my mortgage.
However then I have to factor in the value of rental properties I own, etc. Then you also have to factor in if prices do fall builders simply stop building meaning supply stops and demand still being there the prices go back up again. So there would be no new builds available only people moving from previous housing stocks.
There is no way prices will permanently fall. If that did happen people would riot and burn homes to the ground.
The only real solution is increasing wages. To do that we need to sort out the economy. To do that you need to try and keep every pound spent within the UK inside the UK.
Huge tariffs on foreign owned businesses and goods. Trump has already been trying similar in America. We need to start manufacturing here again. It's not a case of landlords are buying all the houses it's a case of wages being crap.
What is the UK world leaders in? You think of other countries and Germany and you have many household names
Miele
Mercedes
BMW
VW
Porsche
Siemens
Bosch
Continental
Adidas
The list goes on and on.
Dyson has moved to Singapore. Virgin has his own Island tax haven. We need to stop these companies from leaving the UK and stop foreign companies from taking all the money out of the UK.
That will solve all the problems if you do that.
I'm waiting to sell mine up and put the money into the stock market instead, owning a property and renting it out is too much hassle for bad returns.
Caporegime
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Apart from a 5% LTV rate will be around 3-4%
And a 15% LTV around 2.5%
So you will likely pay a similar amount in outgoings on your mortgage even on the cheaper house.
You can keep trying to narrow it down but you'll never get to the point where there are zero home owners who wouldn't like to see a fall in prices. "Nobody wants to see them drop apart from people who don't own a house." is a false statement.
I wouldn't be surprised if you ended up paying more over the term of the mortgage on the lower amount at a higher rate.
Anyway, the point is that you likely wouldn't be able to move, you're not likely to get a mortgage with the 6% deposit.
I thought the main argument about house prices being unaffordable was because people can't save up the required deposit? and the actual cost of the mortgage over the full term is largely irrelevant.
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