Profound changes for the housing market?

Graham_Devon

The Conservative party is quietly redefining home ownership, writes Gaby Hinsliff, in a way which could help first time buyers but hit those relying on rising house prices to fund their lifestyles.

How excellent is that?!?!

Grant Shapps, the housing minister, gave a speech to the Housing Market Intelligence conference urging a period of house price stability and of treating homes not as investments but as somewhere to live. More significantly, he sided decisively with first time buyers (who need prices to fall) over established homeowners (banking on prices rising).

do they want to shore up prices, as the last government did with stamp duty holidays and moves to curb repossessions? Or do they not, which could mean letting the market correct itself while keeping interest rates low to ease mortgage-holders' pain?

The coalition now seems to favour this second, less interventionist approach.

Well it got better!! :D

I am obviously quoting select parts of this article, but please, read the full article, which can be found here: http://www.channel4.com/news/is-housing-market-headed-for-profound-change

Briliiant article

Batchy

awesome article... very reassuring that rates will be staying low for a while.

Im sure there wont be lots of people trying to buy a house now that they know that, that virtually eliminates RISK.

If they really want the market to correct itself, they need to make renting privately more enjoyable experience, almost the equivalent to home ownership without equity or high deposits, but with ability to decorate and live life with pets as you prefer. With long term secure contracts and a degree of flexibility if necessary!

Without capital prices of houses increasing then why would anyone want to buy?

robin_banks

Grant Shapps and intelligence in the same sentence ?.

IveSeenTheLight

From the speech
http://www.24dash.com/news/housing/2010-10-12-Grant-Shapps-full-speech-to-the-HMI-conference

So what is required now is a period of house price stability.

Stability, not HPI, not crashes, confirmed here

House price booms keep people out of the market.
And house price busts mean people’s homes are worth less than they paid for them

Interesting ambition, but still, stability, not HPI or crashes.
Not boom and bust

I have a simple ambition.
An ambition for a period of house price stability

Missed this bit yesterday in MSE.
You will say bye bye to the competativeness if there are sustained falls, until recovery is once again on it's way

In case you think deficit reduction is all pain and no gain you should ask Martin Lewis, the money savings expert. He pointed out yesterday that the cost of tracker mortgages fell to a record low during September as competition continued to return to the market.

Interest rates to be kept low and acknowledging that credit availability is key.
Seems like we've been saying this for a while.

So it’s really important that we keep interest rates low and improve credit availability for first time buyers, house movers, landlords and yes, housebuilders.

Renovation man will like this

And I wouldn’t want that success to be threatened by letting interest rates rise quickly

He also acknowledges that more properties need to be built to supply the demand

Of course we must build more homes.
The “demographic imperative” demands it

We will do our bit.
In return we want you to do your bit.
To get out there and sell the benefits of new homes.

Show them what the incentive can buy – what they can get for their money.

Yes very interesting indeed

carolt

Batchy wrote: »

awesome article... very reassuring that rates will be staying low for a while.

Im sure there wont be lots of people trying to buy a house now that they know that, that virtually eliminates RISK.

If they really want the market to correct itself, they need to make renting privately more enjoyable experience, almost the equivalent to home ownership without equity or high deposits, but with ability to decorate and live life with pets as you prefer. With long term secure contracts and a degree of flexibility if necessary!

Without capital prices of houses increasing then why would anyone want to buy?

Eh?

Run that by me again. Have you never heard of a 'home'? Or is your house purely an investment?

Shocked, truly. :eek:

carolt

By the way, Graham, whilst the article sounds nice, if it is an accurate statement of intention as David Cameron's 'we will not remove child benefit' before the election, it's not worth the paper it's written on.

bendix

carolt wrote: »

By the way, Graham, whilst the article sounds nice, if it is an accurate statement of intention as David Cameron's 'we will not remove child benefit' before the election, it's not worth the paper it's written on.

Still wondering how you're going to manage losing the invaluable child benefit from your top 10% family income, carol?

Your poor kids. I can see them now, wandering starving through the streets in threadbare clothes now that the nanny state is saying you've got to pay for them yourselves.

Ouch . that must really smart!

Batchy

carolt wrote: »

Eh?

Run that by me again. Have you never heard of a 'home'? Or is your house purely an investment?

Shocked, truly. :eek:

It was tongue in cheek carolt

I didn't buy when prices were increasing ridiculously, I did buy, for a home, in what appears to be a stalling/ stagnating market.

My point was about OTHERS, and their mentality for following the crowd! Not about ME.

Conrad

Batchy wrote: »

If they really want the market to correct itself, they need to make renting privately more enjoyable experience, almost the equivalent to home ownership without equity or high deposits, but with ability to decorate and live life with pets as you prefer.

This will come at a cost though. Imagine you were to risk your childrens inheritance by investing in a B2L - if the tenant has such freedoms and then leavs - you might find it harder finding a replacement if instead of neutral colours, the slap dash prior decorator had dawbed red paint all over.

In other words such costs will be reflected in rent rises.

Always remember a LL does not have to invest in property - he could just leave his childrens future in an ISA, so the return must reflect the risk.

Batchy

If you give every tenant the freedom to paint, then they will all not worry about colours.
They will think, ooohh that would look lovely with a nice feature wall... etc.

What actually can you do in rented these days, my friend can actually do what he likes, hes been there 3 years, and painted every room so far, private landlord, never even been to the house, he put in a new fire replaced thermostats etc.
Compared to me when I rented, it was as good the day I moved out to the day that I moved in!... No problem with rent.

The problem I had, was with neutral colours, and strange colour carpets I could just do nothing with!... was ridiculous and no way for a 30yo to live...

Jenniefour

IveSeenTheLight wrote: »

From the speech
http://www.24dash.com/news/housing/2010-10-12-Grant-Shapps-full-speech-to-the-HMI-conference



Stability, not HPI, not crashes, confirmed here

If indeed the Government are putting their money where their mouth is, and this is true and is going to become policy i.e. they definitely will intervene if the market rockets up again - then the use of the word "stability" is simply a get out clause if prices do go down. It will be deemed an unintended consequence. I say "go down" with a bit of a rider - the only thing that's keeping this market looking not so bad in the national statistics is that London prices are propping it all up.

The Government could not be seen to be openly supporting a drop in prices - upset far too many voters.

Bean for the B of E did actaully say as much very recently - that there would be intervention is property took off again. Maybe they've finally learned their lesson. We shall see.