'Rent now buy later' housing plan - Govt plan

IveSeenTheLight

http://news.bbc.co.uk/1/hi/business/7508350.stm

A "rent first, buy later" scheme is heading a series of measures which the government hopes will breathe new life into the housing market.
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Under the government's plans, households earning £60,000 or less would be able to rent at 80% or less of the going rate for two or three years in order to save up for a deposit.

moanymoany

Does this mean that the government is going to buy up housing stock to let it to the people this scheme is aimed at?

It could be council housing by the back door, there are bound to be those who rent and don't buy.

It sounds to me unworkable, time will tell.

The only real way to deal with the problem is to have a situation where people have access to housing for three times their income plus a decent deposit.

We also need a large stock of good, long term housing for rent. It was there for people 100 years ago as massive numbers of houses were built for rental by private organisations. Later came council housing. There will always be people who can never buy their own house, they should be provided for.

BenL

Government trying to continue to peddling the housing market.

Hopefully they will u-turn on this like most other things.

Rent at 80% of value for 3 years to save and then buy 25% of it.

Errrrmmmm no thanks.

Lets just let house prices return to a more affordable rate so people can buy 100% of a house.

These plans do nothing to help and hopefully people will steer well clear or a few more years down the line it will be rent at 80% for 6 years then have an option to buy 5%.

It's crazy that they are thinking up these schemes to try to get more FTB's to throw their money away on a dwindling asset.

m00m00

more tinkering to keep the trough flowing with money from new build developers.


when the small print of this is announced, it will be limited to crappy new builds in ropy locations

lostinrates

It seems a good metaphor for this is the house(..ing market) built on the sand.

I wholeheartedly accept that through minor blips positive spin and nifty ideas can help ride something otherwise fundamentally strong out, but reports from all ove the palce ae telling us we are in deep trouble with credit, with employment, with inflation, with the now disappearing easy lending, and the possibilty of those not even eligable for that easy lending routinely acquiring it anyway.

I remain genuinely orry for those undoubtedly suffering or about to suffer through this, and I remain as desperate to have my own home, but it seems the more these shaky ideas to sustain the current market are around the greater the number of people who will ultimately suffer, and the amounts to which peole are indebted will increase.

ruggedtoast

Frankly I wish this clueless government and whichever thinktank produces their inept pointless policies would just crawl away and die somewhere.

lostinrates

ruggedtoast wrote: »

Frankly I wish this clueless government and whichever thinktank produces their inept pointless policies would just crawl away and die somewhere.

an aquaintance of our was employed into think tank just before graduating. Zero life experience, no employment ever, not even working a bar through Uni, university course, though good, was modern languages, not even political hitory or something to make up for lack of experience, and though a nice guy and not academically dull, he was, imo, utterly out of touch with prety much everyone nd I didn't really undertand what his thoughts were worth.

obsessed_saver

Interesting, I already saw an advert from a property developer with a scheme like this in last week's local Property pull out. The gov is a bit behind times?

baby_boomer

The market is in the process of correcting the "fairness" issue (i.e. the ability of ordinary people to aspire to own their own home.

Unfortunately this has two side effects for the government:

a) the government will miss its "new homes built" target by a country mile and
b) the doom and gloom from lower house prices will see the electorate turn on the government.

In part this is tinkering for the sake of being seen to do something. In part it is not knowing what they want.

The bottom line is that it is unlikely to make much difference since it will be mere tinkering at the edges, and by the time it comes into effect housing may already be affordable :eek: .

It's main role is likely to be as an illustration of the Brownite approach to government, rather than a mechanism for building more homes or helping first time buyers

carolt

What a truly rubbish idea.

More council houses - yes, good idea. More cheap houses for sale - yes good idea.

Confused, half-baked compromise between the two = pants.

No thanks, I'll just rent normally, wait till prices have crashed to a reasonable level and then buy 100% of a house.

What the Govt. don't seem to want to realise is young people don't want to be sold some codswallop 'own 3% of your own house as that's all you can afford while we try to stop the economy collapsing by spending taxpayers' (ie incl. the priced-out generation's) money on artificially propping up house prices'. No. We want house prices to crash to reasonable levels soon, so we can buy in the same way past generations were able to, without mortgaging ourselves until we're 80 or never going out until we're 95 after a lifetime of tinned beans.

Anyone from the Govt. reading this? Got that?

Good - leave the housing market ALONE. If free market mechanisms were just fine and dandy on the way up, then they should be just fine on the way down too. Some people will suffer? Sad but true. Some people suffered on the way up too, but that never worried anyone in power then.

Please don't waste my hard-earned taxes on propping up the housing market. LET IT FALL.

Free_Conveyancing_Advice

Interesting. In principle this sounds like a good idea. The problem, after all, with the housing market is that, 100% mortgages having been withdrawn, it is virtually impossible for first time buyers (who more often than not will not have deposit but they've all got used to the idea of not needing to save up for anything anymore) to be able to buy. Without a first time buyer of course, there is no chain. There are some practicalities to be addressed though - firstly presumably the government will not be purchasing these houses so if they are to be involved does this mean that they will be offering some sort of guarantee to builders in the event that the tenants, after the two years, decide not to buy after all? If so there is potential for this to cost the public purse a great deal of money. Noone in their right minds would enter into a contract today to purchase a property in two years time and so the tenant would have to be free to decline the option to purchase. Secondly, will there be any obligation on a tenant to actually save the deposit of not just take advantage of cheap rent for two years at the expense of the taxpayer? One possibility would be for the tenant to pay 100% of the rental value for 2 years, 20% of which could be retained and used as the deposit, or kept by the government if they did not go through with the purchase. I will be interested to see what the plans are if this idea develops.