Amazingly Niave Theory

HAMISH_MCTAVISH

ILW wrote: »

Please don't say "property ladder" it is very annoying.

Well within the traditional context of most people buying a small place first, then building equity and moving up to a bigger place, it is appropriate and will no doubt continue to be so.

However the term Property ladder makes it sound very one directional, whereas in reality all wealth contained in housing is ultimately redistributed to the following generations.

'Property Ferris Wheel' would be a more accurate description.

FATBALLZ

LilacPixie wrote: »

I find it amusing the OP has written off a whole generation based on a few friends of his. I always thought the average age of a FTB was in the early 30's anyway.

For those without parental support I believe the average age is 38, or it was last time I heard.

FATBALLZ

HAMISH_MCTAVISH wrote: »

Well within the traditional context of most people buying a small place first, then building equity and moving up to a bigger place, it is appropriate and will no doubt continue to be so.

However the term Property ladder makes it sound very one directional, whereas in reality all wealth contained in housing is ultimately redistributed to the following generations.

'Property Ferris Wheel' would be a more accurate description.

I'd liken it more to a property cliff, the guys at the front, baby boomers and the like, climb the slope to get all the good stuff on the way up, with everyone else following them picking up the scraps.

Then when the guys at the front come to the edge, they chuck what they have to the ones immediately behind them and promptly fall of the edge. The guys who are now at the front get to enjoy the goodies for all of 5 minutes before falling off the edge themselves etc.

1984ReturnsForReal_2

Ever thought about defaulting for a few months & going on a holiday in the Indian Ocean somewhere?

Just a thought.

StevieJ

[QUOTE=FATBALLZ;39706366]I'd liken it more to a property cliff, the guys at the front, baby boomers and the like, climb the slope to get all the good stuff on the way up, with everyone else following them picking up the scraps.

Then when the guys at the front come to the edge, they chuck what they have to the ones immediately behind them and promptly fall of the edge. The guys who are now at the front get to enjoy the goodies for all of 5 minutes before falling off the edge themselves etc.[/QUOTE]

Do you actually believe that crap?

LilacPixie

FATBALLZ wrote: »

For those without parental support I believe the average age is 38, or it was last time I heard.

That's interesting.. I though it was more like 32 or something but anyway people not buying in their 20's is hardly unusual.

Malky

I know quite a few 20 somethings who have a mortgage and 30 somethings who don't. I was 23 and my partner was 20 when we first got a mortgage. I think the OP's information is a little bit skewed.

the.ciscokid

HAMISH_MCTAVISH wrote: »

Well within the traditional context of most people buying a small place first, then building equity and moving up to a bigger place, it is appropriate and will no doubt continue to be so.

However the term Property ladder makes it sound very one directional, whereas in reality all wealth contained in housing is ultimately redistributed to the following generations.

'Property Ferris Wheel' would be a more accurate description.

You realise that increasing house prices are only good for speculators and bankers though, don't you? Therefore the property ladder is actually a bad thing for your average person, financially that is.

Increasing house prices = more debt. More debt = financial collapse.

System

Property prices could remain static, the property ladder would still exist.

HAMISH_MCTAVISH

the.ciscokid wrote: »

You realise that increasing house prices are only good for speculators and bankers though, don't you?

Increasing house prices are neither good or bad. They are simply inevitable over the medium to long term so long as we build less houses than we need.

In terms of who benefits from increasing house prices, more people benefit than are disadvantaged.

At any given time more than 50% of houses are mortgage free, and for almost all of them, the next move will be to downsize, release equity, or leave an inheritance. For them rising prices are better.

For multiple property owners, BTL investors, or developers, rising prices are better.

For anyone with a mortgage and less than 50% equity, rising house prices are better as mortgage costs are now segregated by equity levels.

For trader uppers, traditional wisdom has been that lower prices are better as the rungs are less far apart. But in this crash, that wisdom has been turned on it's head by the fact that the rungs have widened as typical FTB properties fell far more than typical 2TB properties. So this crash actually hurt most trader-uppers.

For FTB's, lower prices should be better. But mortgage rationing has locked most out of house buying anyway, and higher rates above base are penalising the few that can buy. Leaving investors to poach whatever deals were available. It is now clear that most FTB's would have been better off without the crash and associated mortgage rationing.

And of course all of that is before we get into the hundreds of thousands of jobs lost by the crash, profits of retailers, manufacturers, builders, banks, etc..... Loss of tax revenue. All of which contribute to pensions for almost everyone else.

So far from your assertion about few gaining, in fact almost everyone has been hurt by the crash, and only a vanishingly small percentage of society has gained.