Priced out generation fights back

sKiTz-0

I could buy this:

http://www.rightmove.co.uk/property-for-sale/property-15156285.html?premiumA=true

in a bit of a rough area tbh, my motorbike would probably get stolen

Alan_Cross

I shall believe that you can be 'priced out' of starter homes when anyone can tell me why two young people, each living currently with their parents and on modest incomes of say £15k each, with next to no outgoings because they get free board and lodgings, cannot jointly save up a deposit of £20k over a period of c5 years.

I hear this moan going on all the time and it comes, naturally, from people who each run a nice car, expect a couple of foreign holidays each year and, most illuminating of all, are down the pub every night spending £10 and at the clubs on the weekend splashing out vastly more.

That tends to mount up.

As someone who lives frugally himself and consequently managed to get onto the BTL ladder years ago, I am pleased to say I can see through all this typical British sham 'poor me' rubbish.

sKiTz-0

free board and lodgings? I don't know who gets that but I am 26, on a modest income of 16k, and pay my Dad rent, and have my own bills to pay. I don't expect to be able to just live rent free and doss in a room in my Dad's house for nothing.

I run a 1996 fiesta which I bought for £500 with which to get a second job delivering pizzas and have kept on the road for 3 years. It is a total rust bucket, and most people my age, especially the ones you are talking about, would not be seen dead in it. me? I don't care, it gets me from A to B, it's economical. However it is on it's last legs and if it fails the MOT next month I can't afford to have it fixed due to not having my second job anymore so I shall be scrapping it and buying a pass for the buses and trains.

I haven had 1 foreign holiday in the last 12 years, which was a driving holiday for a week with some friends in France as it was cheap. I had a holiday last year which was a long weekend to Ireland, so I do not plan on having another holiday for another few years to come yet. Foreign or otherwise.

I don't ever go to the pub - I had a night out to a club for a friends brithday in October, and had a night in the pub with a friend who was up north from London last Friday with a budget of £20. That's it. I simply can't afford any more than that. I don't particularly like staying in every single night, but I live quite frugally too and can't go out spending money like that. And it still gets me nowhere.

Also, I don't have a partner with which to share the cost of house buying, and if I met one now I would certainly not be tying myself to a 25 year contract with them any time soon.

Pobby

Linda Tugwell, so it WAS you!

HAMISH_MCTAVISH

sKiTz-0 wrote: »

I am 26, on a modest income of 16k, .

That would be the problem.

Davesnave

Pobby wrote: »

Linda Tugwell, so it WAS you!

No....well maybe... I used to drink, a bit. Can't honestly remember now!:o

Shakethedisease

What would happen to those that still could not afford to buy and there was no renting options?

That's already happening luv.

64,000 homeless households in England were living in temporary accommodation arranged by local authorities at the end of March 2009. Just over 49,000 of these households had dependent children...
Due to the current shortage of social housing, many homeless people can remain in temporary accommodation for several years before they’re rehoused

In 2008-09, 57,304 households made homeless applications to their local council in Scotland.
The number of households accepted as homeless or potentially homeless has increased by 21 per cent since 1998-99.
In 2008-09 there were around 22,000 children living in households accepted as homeless.

Adsense ads !!!

"Need your tenant out?
notice served on tenants nationwide
Tenant eviction from £95.00"

This documentary was particularly thought provoking and very frightening when I watched it a few years ago :-

http://www.guardian.co.uk/culture/tvandradioblog/2006/nov/28/evicted

Now, there's 'priced out' and all the analysis above here on historical rental levels ( most were council renters up to the late 80's btw) /owner occupier stats etc.. then there's a growing/expanding/increasing swathe of people in the above situations. They cannot rent privately, and cannot buy. This, in IMHO will be the the 'torpedo from below' to HPI.

With all the proposed 'painful cuts' to come re incomes, taxes, sweeping public sector jobs, austerity packages.. whatever you want to call them.. private rentals ( no dhss, no housing benefits, no defaults, no ccj's, no children, no pets, sorry ! oh and a £200 'admin fee' per person up front please if you want to chance it anyway )... yes, private rentals are going to become unobtainable to more and more people/families. They're getting far too 'choosy' about the calibre of tenant due to their housing insurance policies. As well as wanting that all important 'return on investment'. Fair play to that on an individual level. On a social level, it has the potential to wreak havoc. And it will...especially with local councils having their budgets slashed across the board.

As for buying.. distant dream even for those on average incomes. Saving a 20% deposit while private renting is nigh on impossible for most.

The elephant in the room IS the amount of people out there who cannot rent OR buy. And they're increasing at alarming rates. There's no 'tenant rental rescue' schemes in place as yet.. yet there are just as many lose their jobs, get divorced and become ill as those covered by 'mortgage rescue schemes'. No rent = {no home + no chance of another private rental - no social housing available } = ????

When local budget slashed councils cannot provide even temporary accomodation anymore ( and many are struggling ).. then the whole housing system as it is will be taken down from the lowest levels.. NOT the highest.

That 3 bedroom duplex in London falling from 1.1 million to 800k won't be so big a deal when councils round the country can't place 100 recently made redundant, 'can't pay the rent and no hope of securing another private rental' families in hostels a week anymore..

There's 'priced out' and then there's 'on the streets'. It's the latter that'll force the issue. Unfortunately.

LydiaJ

Shakethedisease

You paint a compelling picture of the plight of these people, who aren't well represented among users of this board. Thank you. However, I'm not clear what you mean by saying that these people will force the issue. In what way? Could you explain?

seven-day-weekend

Pobby wrote: »

Perhaps someone can enlighten me. Thatcher did the right to buy thingy but as I recall the local authorities were banned from using the cash for more social housing. Can anyone recall why that was? Or did the old gal have a couple of BTLs?

She brought out the RTB scheme to win votes. She prevented any more from being built because she did not agree with social housing.

You will notice that twelve years of a Labour Governmet has not reversed this.

I don't really understand the discussion here, but would just like to say that I think there should be more social housing, but if someone is occupying a social house that is too big for them (e.g children moved away) they should be moved into a smaller one, or a flat, thus freeing the house up for a family. They should not be allowed to stay in the large one for the rest of their days.

dopester

Houses, flats, and land. Sorry to reveal the simple facts, but the values of all these are so utterly dependent on a) What the lenders are willing to lend people to buy them at, and, b) what borrowers are prepared to borrow.

If lenders are willing to lend ever more in debt, and have borrowers willing to take on ever more in debt, real estate prices inflate.

That has been the case a bit past 1997. Increased lending and borrowing beyond what economy proper was honestly capable of sustainably generating. Credit multiples taken to extremes through flawed exotic derivatives and subprime loans ever expanding credit to extremes.

• Lenders are coming to their sense. In ever more instances, they are not prepared to risk money, shareholder value, their very existence, at levels where the borrower can't pay them back and defaults.
• Ever more would-be borrowers are being checked back into reality as in the real economy their employment and pay prospects are ever shakier, in many sectors (not all).

Social housing? First things first is to stop trying to prop up the boomed-up artificial prices of the old world.

We're heading back to finding just what sort of lending and borrowing levels the economy proper is capable of supporting, and I don't believe it's anything like the levels of the credit boom frenzy. Let low interest rates and low transaction rates keep up the illusion that boomed-up property values are sustainable for now.

misskool wrote: »

Actually, the one thing I agree with you is that housing stock should be prioritised. Social housing should be increased and there should be more houses instead of flats so people can be settled for longer. The whole moving up a ladder thing would negate the prices inflating too rapidly. If people did what they used to do which is buy one house for life, that would help. If there was enough social housing, then the right people would get help instead of being at the mercy of unscrupulous landlords and councils wouldn't have to pay rent to private landlords.