No one would buy a house and we would all rent, where would the tax come from then???
House prices rose 7.3% this year, average now almost £250k
- Thread starter HACO
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I broadly agree with the point that houses should be within reach for normal people in normal jobs, it's a societal good, you need people to be able to create their own security to be invested in society etc.
Your attitude and tone comes across as super salty though and those same people who would benefit from the changes you're suggesting are also currently dealing with the world as it IS because you can't pause life and therefore would be badly hurt if it happened too quickly. It's easy to say "tough" when either you haven't gotten involved yourself or are shielded from it, whichever it is I guess that's why you sound a bit trolly about a genuine problem.
We need to make changes like changes to taxation/multiple ownership/building etc but going to fast would create a very toxic situation that would help no one. I'm not sure if you remember but the last time we had a wobble about what houses were "worth" we had a massive recession, a decade plus of austerity (ideologically driven for sure but it still happened and the Sun etc whipped the public into mostly supporting it) and a ton of people lost their jobs/job security.
It's not just house prices that need to be considered because sadly that is now most entirely normal people's main asset that they've signed up on mortgages over long periods to pay for and sneering at them is not helpful. Nobody is signing up on 120% mortgages or self certs anymore because they don't exist and you don't have the option to not live somewhere.
Which is why your car analogy is pure derp. A car is a consumable, you use it until it's used up and then it's worthless and you switch it (broadly speaking). A house is not that, in fact a good chunk of the "value" of your house is the land it sits on not the doors and windows.
Which is why I honestly believe it needs to be a generational thing.. A slow decline/stagnation I believe is what's required.
That way you create stability for people to get on the ladder, burn or disinterest the speculators etc.
I personally believe the only way to get there is a massive government house building project, rent controls, long term leases and developer subsidies.
We're not going back to 3x salary buying you a house anytime soon, we just need to forget about that. It's not as if that was forever anyway, I suspect it's been not like that for longer than it ever was like that. We didn't have mass ownership must before the 50s/60s anyway.
Yep, in gaming terms, buffing things up is always better than nerfing things down.
Indirect balancing means you don't ending up hurting a bunch of people as collateral damage.
The people who are renting your house to you...
You're thinking short term. Of course the property tax wouldnt come in overnight, I've already said that. Long term it will help make/keep houses affordable and more people would be able to buy homes for themselves rather than (as we are now) being forced to pay extortionate rent because there's no other option available.
I totally agree. Although as a tenant, I think a hard crash would be funny in a way, I know it's not the best thing overall. My saltiness is only born out of having to repeat the same arguments over and over and being met with nonsense like "my parents had to work hard" like young people aren't doing that nowadays. People also assume because you're arguing on an internet forum you're not doing all the sensible things to help your own position - which of course I am.
Contrary to popular opinion, I don't actually believe there is much of a housing shortage in this country. You only have to look around at all the new developments with unaffordable flats that are bought up by investors to see that is the real issue. I couldn't care less if property developers lose out in the short term; they've been on the gravy train for decades now.
Are you renting in London and complaining about the price of property in one of most expensive cities in the world?
It wouldn't be a significant tax increase. It would be linked to property prices so would increase with property price increases but if it had the desired effect then that should be around inflation rate so no tax increase in real terms.
It’s not at the level you are proposing based on my numbers. Why take on the risk of a house if it’s going up at inflation (not growing) and pay interest to a bank when you can just rent with no additional house maintenance
...just like countries where property tax already exists
Sorry, I don't understand that post. You'll need to explain it to me.
Maybe understand the whole proposal
It's not like they're breaking even... Persimmons posted a gross margin of £1bn last year and the year before. They can afford to take a hit.
It doesn't matter who owns the house. Whether you rent it from a landlord or you own/mortgage it yourself. The property tax would still be the same, based on the value of the property. The ratio of renters to home owners wouldn't have any impact on total property tax income.
Well my personal argument was stagnation/slow decline so I think developers would be able to handle that.
Then there's the developer it SHOULD be which is the government, I don't see any signs of that and you can absolutely whistle whilst we have a populist right wing government but I think it's semi inevitable at some point.
And the same thing goes for this pockets of land thing, if it's not being used force sale it. End of story.
Also, it would appear we're about to have/already have large parts of town centres that need regeneration. Get the government involved in either underwriting or just straight doing that.
If you wait for people who make money of scarce resources (ie land and buildings) to step in then you're mad to think anything is going to change.
As a recent FTB'er we took out a large mortgage, because frankly that's the only way you could buy a property. It's within the realms of what the bank deem as affordable, and i've got at least another 35-40 years of potentially working, so in reality it's quite insignificant.
A huge drop in the house price as a result of taxing property wealth instead would plunge us into negative equity. Should the government cover that shortfall? You claim if it's to be for the greater good then so be it. But you'll have hundreds of thousands of FTB'ers who have purchased a property in at least the last 5 years who will now find their property worth significantly less than the balance they owe on it.
That's not for the greater good, that's just having a narrative to suit you because you've not been able to get on the housing ladder. The "i'm alright Jack" attitude works both ways.
In fact, anyone who is in their 'forever' home and no longer has a mortgage would benefit the most from a crash, as if their house value drops, then their value tax drops.
The value of the property only matters if you are looking to sell, or if you have a mortgage (as getting a new mortgage agreement would be impossible once in negative equity, so you would end up paying through the nose on inflated interest rates).
Blah blah, pull the other one. This isn't a London problem anymore. It stopped being a London problem in what the 2000s? It's quicker to quote myself than repeat myself all the time;
Great. And what about the people that live in the other 19 unaffordable cities in this list, for example? Because the lowest on there is 7.2 times higher than the average salary (Gloucester)
Exactly.
And what's the problem? Unless you desperately need to move in the next 3-4years you're fine. Sure, you paid over the odds for something but that always should have been a consideration. At the end of the day you will have a mortgage to pay that you can afford until the end of it's term (right?), and you will have a safe and secure roof over your head. If you're about to reply and tell me "what happens if I lose my job" well then guess what - approx 40% of the population rent and if they lose their job they are out on the ear within two months notice. So that's no argument for propping up the housing market in my view.
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