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[MSE Natasha]

Poll between 6-12 May 2008

House Prices: Would you prefer them to rise or fall?

For the first time in many years it's been reported there's been an annual fall in house prices (by 1%). For most things, falling prices benefit consumers. In house prices it helps first time buyers and upgraders, but it's worrying for those with little equity in their homes or planning to sell. But what's your instinct, that is, which of these would you prefer?

Big house price rises 5% (363 votes)
House prices rising but slowly 20% (1444 votes)
Stable house prices 24% (1737 votes)
Gradual lowering of house prices 20% (1500 votes)
Major crash in house prices 32% (2323 votes)


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[going2die_rich]

B.

Any fall would harm the economy. You also need some growth in order for owning your own home to have some value in it, as if it was just stable what would be the point, you might as well invest else where. Stable also tends to mean your below inflation in real terms.

[canardo]

a period of -1% 0% or 1% which really means in real terms a lowering of 5-6% a year to give salaries a chance to catch up with an over inflated market

For a lot of people prices have to fall a fair way before they are in negative equity, the media seems to forget that assuming all houses fall or rise at the same rate it all stays as an even field unless you need to get on or off the ladder which I think some people need reminding off, the banks such as Northern rock lending over 100% ltv obviously make this problem worse for some people who have borrowed large amounts

In the Midlands its 400-600 to rent 500-700 a month to get a repayment mortgage so hardly see there being that much risk in having a mortgage for your primary residence, if you don't mind being tied in and have a relatively stable job and are not borrowing large multiples of your income.
The value even in a flat market is not having to move every 6 months and pay associated estate agent fees (unfortunately longer rental terms seem hard to get in the UK compared to Germany etc where renting is a much more pleasant experience)

Obviously for those investing in the property market this is bleak times, however we have had too many hero landlords who think adding a coat of magnolia is property development and rash of buy to leters which has pushed the cost of living up in the UK

[Chef1980uk]

Would love a crash in pricing tbh. My wife and I have been renting for 10 years now without a hope in hell of getting a mortgage as we only earn £24,000pa between us.

[Dorrie]

Would also prefer a big crash - I have three teenagers, what hope do they have at the moment of getting on the housing ladder? Not like there are loads of council houses/housing association places standing empty waiting for them. Where are they going to live? Even a one-bedroomed flat in my town costs over £100,000.

[Candoguy]

I'd like to see a crash of about 40%.

If house prices have risen by over 100% in ten years then wages obviously haven't. How is that good for the economy? It may be good for those who already own a house (or two, or three), but it's extremely unfair, unjust and immoral that it is now impossible for those who haven't managed to buy up to now to be able to own a home.

There is a national obsession with owning your own home in the UK and I don't believe it leads to a very healthy and cohesive society.

Of course, when asked, most people would prefer to buy, but how realistic is that? In a lot of European countries the majority of people rent and their overall standard of living is much better than here (just ask someone from Scandinavia, Germany or France) because they have more disposable income to spend on other things rather than just giving it to the banks which is what mortgage holders are effectively doing - the banks are increasingly controlling society.

With prices allowed to keep on rising all that does is disenfranchise those that don't own one. Why are people so surprised that the gap between rich and poor is still widening when the feudal system is alive and well in this country?

Bring on the mighty crash and lets have a major readjustment so that there's more of an equilibrium in society.

If that sounds like the writings of someone who doesn't own their own home, then you'd be right. I have a housing association flat and consider myself to be very lucky. I've also just discovered that I am legally allowed buy on the open market without losing my existing flat (providing I still live in it) thereby making me into another buy-to-let profiteer.

[172]

This is a difficult one... a house is not a business but a home - if its a business then it is not a discussion on home ownership but markets. The move from a home to a business has corrupted this arena of life. Of course solicitors, banks, estate agents, building societies, and this thieving government want house prices to increase as they can screw you for more of your hard earned money - people do not seem to realise that they are the ones who are losing out - whilst the aforementioned organisations hype the market in order to delude people that what their house is worth means something - it does not - at least not until you die or sell up and move to a developing country! Lower house prices would enhance every area of life whilst freeing millions to put into the economy - it a fallacy to imagine that soaring house prices help the economy. The misery generated by the manipulation of the public is huge and tragic. The public do not gain in any way. However, the difficulty in all of this is those who have been duped and have mortgages higher than the appropriate value - this is not an easy one to solve - but going further down the insanity of a market out of control (apart from the banks, government etc who love it) will only delay the day we correct the 'free hand gone mad'. It is a puzzle why people seem to believe those who gain by higher prices - i.e. aforementioned deceivers. There is no easy answer but lower prices is the only way to begin the correction and fight back against the swindlers.

[PhilDS]

Originally Posted by Candoguy

If that sounds like the writings of someone who doesn't own their own home, then you'd be right. I have a housing association flat and consider myself to be very lucky. I've also just discovered that I am legally allowed buy on the open market without losing my existing flat (providing I still live in it) thereby making me into another buy-to-let profiteer.

If that is true, that is the real thing wrong with society (ie. Labour government). My taxes pay for you to live in a housing asscociation flat, but, if you can get a mortgage, you can buy another? Why couldn't you live in that place? I'm not having a go at you personally, just the rules that would allow you to do this.

[Prickles]

Do not need a fall at present as I have to sell a house to pay off ridiculous Inheritance Tax as didn't have time to get married when longterm partner got ill and died.

[moggylover]

Originally Posted by PhilDS

If that is true, that is the real thing wrong with society (ie. Labour government). My taxes pay for you to live in a housing asscociation flat, but, if you can get a mortgage, you can buy another? Why couldn't you live in that place? I'm not having a go at you personally, just the rules that would allow you to do this.

I repeatedly see comments like this - and fail to see how anyones taxes allow people to live in housing association properties! For many people who now own their own homes there was a long period of government subsidy when we got tax relief on our mortgage payments. My parents benefited from this when I persuaded them to BUY their council house (which my father dissaproved of) and their mortgage payment was lower than their rent would have been WITHIN TWO YEARS!

Furthermore, since the "right to buy" fiasco - Councils and Associations have made enough money from people who have bought their houses that they ought to have been able to have bought or built further housing without any need to dip into our taxes.

I personally see no difference in renting from a private landlord and renting from any association and, lets be honest folks, if you are buying on a mortgage you spend 25 years (or more) renting your house brick by brick from the Building Society!

In our area, which is a very poorly paid one, people in council housing are paying far more in rent than anyone who has had their mortgage for three or four years - and those houses that they are renting are not exactly well maintained by the Council and most people end up spending their own money on maintenance that would be covered by the landlord in a private rental because it can take forever to wait on the council to do the repair - not much fun when you have no heating in the middle of winter and the Council tells you it could be three months before they can get your boiler repaired/replaced!

I consider myself EXTREMELY lucky to own my own HOME - on a tiny mortgage of £20,000.00 now, and I worked two jobs (8.30 to 5.00 in one and 6.00 till 2.00 in another) in order to be able to raise a deposit and then to pay my bills when I borrowed 4 times income in my home town Slough originally(26 years ago). I do not feel it is necessary to knock those that for varying reasons do not climb on the housing ladder - nor do I begrudge them their Council/Association House. I would - if they then bought another house to rent out - that is not the moral behind social housing!

My mortgage is now low - and thus my monthly mortgage outgoings are far, far lower than my rent would be (about £235 a month including my endowment payment) because I have now owned my own home here for 18 years - it was tough at the start - but for buyers it gets easier if you are actually buying a long term home not forever trading up - for renters the rent ALWAYS goes up.

[Paul N]

Originally Posted by going2die_rich

B.

Any fall would harm the economy. You also need some growth in order for owning your own home to have some value in it, as if it was just stable what would be the point, you might as well invest else where. Stable also tends to mean your below inflation in real terms.

This is the typical warped attitude of people in this country. They see home ownership as something to profit from, and its their right to profit from.

as if it was just stable what would be the point

Here's an idea - TO LIVE IN !!!

Since when has it been everybody's God given right to profit from their property. If you speculate in property, you take the falls with the gains, exactly like other investments. If you can't handle that, you're not an investor. Stick to savings accounts.

[moggylover]

Originally Posted by PhilDS

If that is true, that is the real thing wrong with society (ie. Labour government). My taxes pay for you to live in a housing asscociation flat, but, if you can get a mortgage, you can buy another? Why couldn't you live in that place? I'm not having a go at you personally, just the rules that would allow you to do this.

I see this silly comment about taxes paying for people to live in association/council accomodation all the time - and it makes me quite angry!
People in these houses PAY rent: and that rent pays for these houses - most of which have been owned by the councils or associations for many years and many of which are in pretty shoddy condition because Councils like slum landlords do not maintain THEIR property particularly well - just wait for its value to rise. Many people in social housing pay way over the amount that they would be paying had they been paying a mortgage for a few years (and really only 3 or 4 years - not 20).

The taxpayer thus "OWNS" that house and IS the Landlord - when these houses get sold (which I do not approve of I might add) the money from its sale SHOULD go to re-investment in social housing - but it does not - and benefits the council tax payers (or at least should if Councils did not spend so much on their entertaining budgets - lol).

Why do so many people have a problem with social housing? Why can they not actually see that any morally decent society will not have a problem with this system? Taxpayers do not actually loose anything!

I personally started buying my own home, on my own, 26 years ago - because at that time, in my home town of Slough, I had absolutely no hope of social housing as a single person (couldn't even make it on to a waiting list). The cost of renting a bedsit type flat on my own was going to be about £180/month and even sharing a house with others was going to cost that: I looked into what a mortgage of £27,000.00 was going to cost and it was very little more than the rents - and I would have TWO bedrooms - so I borrowed 4 times income and rented out the second bedroom (rather more cheaply than the going rate I might add) which allowed me to have a HOME, and an investment, and just about pay the bills! I was also able to share my good fortune with someone else who needed a roof over their head - did I begrudge them that - NO! I was helping them - and they were helping me!

Having now owned my own home (this is my third) for 26 years I pay about £235 a month for my own property which is far less than half the council rents around here and I will be mortgage free later this year when the huge endowment I took on my second house (and carried onto my third, far smaller, mortgage) matures.

I consider myself VERY lucky! Do I begrudge others the years they will pay rent and never "own" anything for it - no I do not!

[moggylover]

BTW - I do believe that if someone in social housing owns another property then they should HAVE to go live in that one - but that is because I am a Socialist who believes that we should ALL have a home before anyone can afford two!

[moggylover]

Hi, don't think I would go for any of those directly. I do think that many areas need a fairly hefty drop in house prices first, and then a stability in the growth of property values: somewhere in line with wages and inflation - not just leaps and bounds due to demand.

However, the only way we will ever stop the leaps and bound is to fulfill demand - and unless we want the whole country built on, we may have to look to some pretty radical changes: which would take a social charter which would have the right wing having heart attacks - and probably taking out a contract on me for even suggesting them! lol

Only thing that is for certain is that we have to acknowledge that EVERYONE is entitled to a home - whether rented or bought - that they can afford, and that those with too much/too many make it bloody hard on those that do not have! Which is the same old story of mankinds lack of ability to share isn't it!

[moggylover]

Originally Posted by going2die_rich

B.

Any fall would harm the economy. You also need some growth in order for owning your own home to have some value in it, as if it was just stable what would be the point, you might as well invest else where. Stable also tends to mean your below inflation in real terms.

A fall will not, long term, harm the housing economy - it will merely mean that there will actually BE first time buyers in the market to start the chain. Furthermore, the point of owning your own home IS owning your own home, not its' value: if you want an investment rather than a home - gamble elsewhere. If we all stop spending "on the knock" to use an old fashioned phrase then we can eventually force prices down anyway - and inflation is something manufactured by banks and businesses globally in THEIR best interests not ours: example: supermarkets publishing HUGE growth in revenue - and then putting up their prices!

Maybe crashing the economy is the only way the British public (or for that matter any public) can ever get a chance to start it from fresh with things being done for the good of the many - and not just the fat cats!

[172]

Originally Posted by going2die_rich

B.

Any fall would harm the economy. You also need some growth in order for owning your own home to have some value in it, as if it was just stable what would be the point, you might as well invest else where. Stable also tends to mean your below inflation in real terms.

You make a good point - if house pricing was stable we may as well invest elsewhere ... absolutely right. We could invest in industry, we could become a manufacturing nation, we could free ourselves from being held to ransom by other countries (e.g.China) when we lose all of our industry, we could enable all to live in and take pride in their home (different to a house!), and we could make many people much happier and build social cohesion and community values...

lets keep up the good ideas...

[moggylover]

Originally Posted by Prickles

Do not need a fall at present as I have to sell a house to pay off ridiculous Inheritance Tax as didn't have time to get married when longterm partner got ill and died.

Was house solely owned by long term partner then? Otherwise, with IT level at £312,000 per person - your own half is taken out of the equation and you only pay IT on the "inherited" half. Price fall will not make much difference to how you end up - as everyone else's house is going to fall in price as well - and the house you buy will be cheaper as well + you will pay less IT. Win, win, situation.

[t_i_g_e_rr]

Has anyone here actually managed to move house in the last two months? There are 'For Sale' boards everywhere, but houses just aren’t selling. That can't be good if you want/need to move. I wish a market fall would just get on with it, and then we can get back to normal. Because the market has risen so quickly, if it fell by 30% how many people would actually be in negative equity?

House price rises don't make most people rich, it just means everyone can buy less for their money, so a drop would be good for many people, as long as it didn't have too many effects on the wider economy (would it?). Actually, I have aspirations to buy Buckingham Palace, and while terrace houses cost much more than 1p I just can't afford the jump!

[sdooley]

Originally Posted by Prickles

Do not need a fall at present as I have to sell a house to pay off ridiculous Inheritance Tax as didn't have time to get married when longterm partner got ill and died.

You know if you sell the property and end up getting less than the probate value you can get a proportionate reduction in your inheritance tax bill?

And that if you keep the property you have the option to pay off the inheritance tax over 10 annual installments?

[Tozer]

Originally Posted by Dorrie

Would also prefer a big crash - I have three teenagers, what hope do they have at the moment of getting on the housing ladder? Not like there are loads of council houses/housing association places standing empty waiting for them. Where are they going to live? Even a one-bedroomed flat in my town costs over £100,000.

Thats a bit knee jerk. Crashes in any sort of market are not good things and will have an enormous fall out.