Councils want power to offer mortgages

baby_boomer

Telegraph

Apparently they held 600,000 mortgages in 1980 before deregulation. Remember them? When women weren't allowed mortgage finance because they were expected to get married and start a family.

"......In a joint letter [ to GB], [the local authorities] argue the public sector should be able to support first-time buyers and offer "new mortgage capacity" alongside private lenders, preventing a collapse in the market and restoring stability....."

lostinrates

baby_boomer wrote: »

Telegraph

Apparently they held 600,000 mortgages in 1980 before deregulation. Remember them? When women weren't allowed mortgage finance because they were expected to get married and start a family.

"......In a joint letter [ to GB], [the local authorities] argue the public sector should be able to support first-time buyers and offer "new mortgage capacity" alongside private lenders, preventing a collapse in the market and restoring stability....."

does that suggest they could afford more frequent rubbish collection but are putting money aside for this??:rolleyes: I wonder if motivation to not have property tax bands downgraded is part of this?

baby_boomer

That and the fact that in Leeds, for instance, there are no Council Houses left! It's easier to fulfil their functions by offering mortgages than by offering houses.

To build more would put up your Council Tax even faster than the public sector pension bill already has.

wymondham

If councils start offering mortgages as well then won't this keep prices high???

chewmylegoff

just another thing for councils to mismanage - the resulting losses being recouped through increased council tax.

no thanks.

how about instead, councils actually pull their fingers out and make available all of the empty housing they own as council housing, rather than letting it sit there to rot whilst the country suffers from housing shortage.

baileysbattlebus

As far as I remember the councils used to do a pretty good job of managing mortgages where I come from. They didn't just lend on council property - this was before RTB. Friends of my parents had a fixed rate mortgage from them in about 1972/3 - fixed for 25 years, can't remember the rate, but people thought they were mad. Guess who had the last laugh.

baby_boomer

Well if you fix a long term rate before mega-inflation goes into overdrive then I guess it doesn't matter who you borrowed from.

Unless, in this example, you were a ratepayer whose council had just handed out a free money ticket to someone else .

If Councils entered the current mortgage market it might make it more difficult for current mortgage lenders, which includes HM Government & the taxpayer at Northern Rock, to break even.

Unless the Councils were offering to take on NR's 125% mortgages :rotfl:

mewbie_2

I think councils (OK States) in the US have been seriously burnt by the property markets. Why would anyone entrust such responsibility to a load of nepotistic slackers who couldn't get a job in the real world.

baby_boomer

At least in the US they are responsible for their own finances, whereas in the UK 80% of their finance comes from central government which pulls the strings for political purposes.

Gorgeous_George

What is needed is more council-owned homes. These could be provided by building new housing estates (100% council owned), compulsory purchase of unused houses or by snapping up selected bargains at the auctions.

Then, after paying the equivalent of £££s in Housing Benefit, at least they would own the house.

GG

napoleon

yes, whack the cost of it onto the council tax - the cure for all financial ills.