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Support for Mortgage Interest Changes
Comments
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andyandflo wrote: »Yes of course they would pay the appropriate amount of rent as 'housing costs'.
But the claimant in this situation does NOT have investment in the property - only the landlord does.
So why should we pay towards a mortgage that the claimant HAS investment in.
I would not argue that there should be support given in both cases and to me, quite honestly the mortgage interest payments made by the state should be no more than what they would have paid out in Housing Benefit for an 'appropriate property', given the size of their family.
That way there would be equality and if the homeowner could not cough up the difference to the bank then, as the other postie said, sell, rent and give somebody else the chance to purchase the property for which THEY could afford to maintain.
This is where your argument completely falls down.
Would you rather someone with a mortgage have help with their payments, who is most likely to have worked for some time in order to have been offered a mortgage in the first place, or some landlord receive payments from the govt in order to house a tenant? The latter is a classic example of making the rich even more so, and keeping the poor exactly where they are!
The great majority of mortgage payments are lower than equivalent rents. In order for a landlord to invest a property they would expect at least an 8% yield, usually closer to 10%. This is higher than most mortgages.
Do you have any informed opinions on the subject? At the moment you do appear to be spouting hot air.Gone ... or have I?0 -
Usually_Angry wrote: »Not owning a home isn't the end of the world.
Agreed, but 6month ASTs, shyster letting agents, unreasonably withheld deposits, can make your life difficult. The private rented sector sucks the big one, and I do not have 'sufficient need' of social housing to get one. The unintended consequence of 'sufficient need' is turning social housing estates into ghettos.0 -
andyandflo wrote: »I would not argue that there should be support given in both cases and to me, quite honestly the mortgage interest payments made by the state should be no more than what they would have paid out in Housing Benefit for an 'appropriate property', given the size of their family.
That would cost far more to administer although I understand your principle - easy to decide number of rooms but house sale prices vary far more than rents do (and that is before you even work out what the mortgage would be on a different house).
It would be far easier and cheaper (less employees) to have one system for all. To do that they would end up increasing council rents to market values and paying what is currently SMI at the level of LHA. Some would win I agree but the whole housing system would put everyone in the same position where it would always be better to work for each household (only taking housing into account there which is by far the biggest obstacle all round).0 -
This is where your argument completely falls down.
Would you rather someone with a mortgage have help with their payments, who is most likely to have worked for some time in order to have been offered a mortgage in the first place, or some landlord receive payments from the govt in order to house a tenant? The latter is a classic example of making the rich even more so, and keeping the poor exactly where they are!
The great majority of mortgage payments are lower than equivalent rents. In order for a landlord to invest a property they would expect at least an 8% yield, usually closer to 10%. This is higher than most mortgages.
Do you have any informed opinions on the subject? At the moment you do appear to be spouting hot air.
SMI reduces social mobility. Currently even if you earn a good salary you cannot buy a home, unless you have wealthy parents, therefore buying a home is the preserve of rich. Continued high house prices are a product of SMI because there are few forced sales.
Increased social mobility generates wealth as people can get rich. Therefore the country get richer through increased tax receipts. Looking at the initial cost of looking after those that have fallen on hard times is incredibly shortsighted. You clearly have not thought through your argument.0 -
That would be an excellent idea, SMI payment arrived at by calculation of bedroom entitlement and market rents, same as LHA. True fairness.
Though in general I disagree with LHA as it puts a floor under rents therefore anti market. People , even in low paid work, should be able to afford better accommodation those those not working, that should be a guiding principle.
And whoever said it, this other poster is not me. I acknowledge that the adjustment to SMI is bad news for some. However it also great news for others!
In that case, for example where I live, the rental amount would be double what I would receive on SMI under the new scheme, plus I would probably be entitled to an extra bedroom...0 -
That would cost far more to administer although I understand your principle - easy to decide number of rooms but house sale prices vary far more than rents do (and that is before you even work out what the mortgage would be on a different house).
It would be far easier and cheaper (less employees) to have one system for all. To do that they would end up increasing council rents to market values and paying what is currently SMI at the level of LHA. Some would win I agree but the whole housing system would put everyone in the same position where it would always be better to work for each household (only taking housing into account there which is by far the biggest obstacle all round).
I agree that the systems should be combined, but for me LHA rates would be a disincentive to work! The amount I would be eligible for at the current SMI rate would be £200 less than the current LHA rate (and I don't even have a lot of equity in my property). It is one of those swings and roundabouts things!Gone ... or have I?0 -
SMI reduces social mobility. Currently even if you earn a good salary you cannot buy a home, unless you have wealthy parents, therefore buying a home is the preserve of rich. Continued high house prices are a product of SMI because there are few forced sales.
Please back this up with the relevant statistics. Oops, you can't, because it is utter rubbish!Gone ... or have I?0 -
Please back this up with the relevant statistics. Oops, you can't, because it is utter rubbish!
I earn 50K, the house I rent is worth 200k. My next door neighbour is a sales assistant and has been all her working life, she bought her house 15 years ago for 35K and has nearly paid the mortage off.
For me to buy the same house I would to put down 50K and take a big mortgage.
A 50K/year professional lives next door a sales assistant ~18k/year? and is much poorer due to a massive mortgage.
Why is that when on the face of it I have been more successful?
That is reduced social mobility.0 -
I agree that the systems should be combined, but for me LHA rates would be a disincentive to work! The amount I would be eligible for at the current SMI rate would be £200 less than the current LHA rate (and I don't even have a lot of equity in my property). It is one of those swings and roundabouts things!
I thought LHA had been changed to allow up to the LHA rate? - you would only get the lower actual cost.
On the plus side though I do think it fair to reward people who try hard - in your case you would get your full mortgage paid as the cost is less than LHA.0 -
I earn 50K, the house I rent is worth 200k. My next door neighbour is a sales assistant and has been all her working life, she bought her house 15 years ago for 35K and has nearly paid the mortage off.
For me to buy the same house I would to put down 50K and take a big mortgage.
A 50K/year professional lives next door a sales assistant ~18k/year? and is much poorer due to a massive mortgage.
Why is that when on the face of it I have been more successful?
That is reduced social mobility.
I've never seen a house go from 35K to 200K in the last 15 years (must be where I live, lol).0
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