Shared ownership/equity is a scam.

Idiophreak

brit1234 wrote: »

I think the vast majority of people would benefit for all these so called affordable housing schemes to be axed and all the other props removed so that house prices can find their natural level which is a lot lower.

You come across as quite a cold person at times.

Houses aren't just numbers on one of your spreadsheets - they're people's homes, they're where their memories are, where they've raised their families...

The idea that as thousands of people had their homes repossessed you'd be there cackling and rubbing your hands in glee is really quite upsetting.

ETA: Oh, and "artifically high" really doesn't mean anything...house prices are a factor of whatever financial instruments are available to fund them. Anyone that buys a home with anything but cash is making them "artficially high" - so you're pro banning mortgages completely, right? Only way to get house prices down to their "natural level"....

brit1234

martinsurrey wrote: »

In fact, builders want to build, its land owners who gain the most from development.

When it costs £20m to buy a patch of land in London, and then you have to build a set of apartments, and give the council a few £m through a s106 agreement (for them to spend on schools), its hard to get the price of an apartment down.

The landowner however has just got £20m for pretty much nothing.

I know builders with planning permission for 100’s of houses that they can’t build, because as soon as they put a spade in the ground, they have to give the land owner the full price of the land, and that makes the development unprofitable, so they have to wait for prices to rise, or the land owner to agree to drop the land price (not going to happen often).

You do realise that many of these land owners are the big building firms actually who are acting in a cartel to force the value of their land banks up. It is pure and simple manipulation like they did with the Land Registry gift deposit fraud before the credit crunch.

Don't falsely make the large builders to be saints, they are bullying, bribing and holding the government hostage. With Newbuy some of the risk with scheme was held with the builders, with Help to buy it has now been fully transferred to the tax payer.

At least Labour have finally started to notice the problem (exception of Harriet Harman calling for more shared equity last night on QT :mad:)

Ed Miliband: I’ll get tough on developers who hoard land

Property firms which buy land as an investment and fail to develop it would face tough penalties under a Labour government in a drive to raise levels of house-building.

They could receive heavy fines or tax demands from local councils and even the threat of compulsory purchase orders as a way of forcing them to develop the land.

http://www.independent.co.uk/news/uk/politics/ed-miliband-ill-get-tough-on-developers-who-hoard-land-8667569.html

martinsurrey

brit1234 wrote: »

You do realise that many of these land owners are the big building firms actually who are acting in a cartel to force the value of their land banks up. It is pure and simple manipulation like they did with the Land Registry gift deposit fraud before the credit crunch.

Don't falsely make the large builders to be saints, they are bullying, bribing and holding the government hostage. With Newbuy some of the risk with scheme was held with the builders, with Help to buy it has now been fully transferred to the tax payer.

At least Labour have finally started to notice the problem (exception of Harriet Harman calling for more shared equity last night on QT :mad:)



http://www.independent.co.uk/news/uk/politics/ed-miliband-ill-get-tough-on-developers-who-hoard-land-8667569.html

Big builders are in no way saints they are businesses, if they can make money doing something, they will, if they can’t they won’t, if they are not building, it’s because it’s not worth the risk and effort for the return it will generate, pure and simple.

Most of the big developers will hold options over land in their land bank and the payment terms for the land will be based on a financial viability test.

The largest OWNER of land that could be developed is in most cases the councils themselves, near my house there has been an empty industrial unit, its council owned, has been empty for 8 years, the planning application that’s gone in isn’t for affordable houses, it’s for a Tesco and private apartments (with a few affordable) because the council went for the highest bidder for the land.

martinsurrey

brit1234 wrote: »

You do realise that many of these land owners are the big building firms actually who are acting in a cartel to force the value of their land banks up. It is pure and simple manipulation like they did with the Land Registry gift deposit fraud before the credit crunch.

Don't falsely make the large builders to be saints, they are bullying, bribing and holding the government hostage. With Newbuy some of the risk with scheme was held with the builders, with Help to buy it has now been fully transferred to the tax payer.

At least Labour have finally started to notice the problem (exception of Harriet Harman calling for more shared equity last night on QT :mad:)



http://www.independent.co.uk/news/uk/politics/ed-miliband-ill-get-tough-on-developers-who-hoard-land-8667569.html

and FYI Barrats only owns 5 years of development land which they own, they sold 12k homes last year and have a 44k land bank.

Given that it often takes 2-3 years to fully develop a site, I dont see that as sitting on a huge amount of land.

brit1234

Idiophreak wrote: »

You come across as quite a cold person at times.

Houses aren't just numbers on one of your spreadsheets - they're people's homes, they're where their memories are, where they've raised their families...

The idea that as thousands of people had their homes repossessed you'd be there cackling and rubbing your hands in glee is really quite upsetting.

Sorry but why would thousands of people be repossessed? We have had 5 years of extra low interest rates, we have had QE and funding for lending making rates even lower. These years those who over borrowed have had ample opportunity to pay down debts whilst savers have been robbed.

You want to use emotive language then how about the memories of this and future generations priced out of ever owning? Never being able to buy a home, or if they do and stretch themselves not being able to afford a family. Those who do not being able to upgrade to a bigger home to fit a family in.

You can't sacrifice this generation and future generations for a generation who lied about their salaries on self certs or put all their money into speculating on buy to let. All I want is a free market where house prices can find their own level. Shared ownership/equity distorts this as well as 0.5% base rates,QE and funding for lending.

The bond crisis is coming and rates will go up like it not. My advise is pay off as much as you can while you can, the clock is ticking.

Idiophreak wrote: »

ETA: Oh, and "artifically high" really doesn't mean anything...house prices are a factor of whatever financial instruments are available to fund them. Anyone that buys a home with anything but cash is making them "artficially high" - so you're pro banning mortgages completely, right? Only way to get house prices down to their "natural level"....

It does mean something if you can't afford to buy when normally you could. These schemes are designed to inflate prices against the norm.

martinsurrey

brit1234 wrote: »

http://www.independent.co.uk/news/uk/politics/ed-miliband-ill-get-tough-on-developers-who-hoard-land-8667569.html

just to add the final nail in your argument against developers, the article you quote says there are 400k units with planning permission that are yet to be built, but 45% of them are owned by none construction firms.

so that means construction firms have about 220k, they build 100k a year, meaning 2.2 years worth of planning permissions, it can take 18 months to get a 10 story appartment block finished, so the lead times can be quite large, again, not really "sitting on huge amounts of land".

Idiophreak

brit1234 wrote: »

It does mean something if you can't afford to buy when normally you could. These schemes are designed to inflate prices against the norm.

These schemes are designed to enable people to buy when normally they couldn't.

Inflated prices are a result, sure, but there's nothing "artificial" about that's it's just supply and demand.

Except, of course, when builders attempt to force people to pay full list for using the scheme...but that's an issue much more specific than SE/SO in general and not really an issue with H2B at all...

grifferz

Idiophreak wrote: »

These schemes are designed to enable people to buy when normally they couldn't.

Inflated prices are a result, sure, but there's nothing "artificial" about that's it's just supply and demand.

Don't you think that government action (i.e. outside the free market) should ideally not result in price inflation though?

It's hard to believe that the only thing that could be done to help people get on the housing ladder just happened to also result in prices going up again.

Isn't it more likely that the government is getting a kicking over people not being able to get on the ladder, but also they know they will get an even worse kicking if house prices go DOWN, and this time from people who are a lot more likely to vote? So they introduce measures that both make prices go up and let people buy houses and hopefully not think about it too much?

Hopefully none of the above places me into brit1234's raving rabid "don't buy property" camp. It's just that I do feel Help To Buy is a bad idea. Maybe coloured by the fact that we are currently buying our first home after making a huge effort to save more than 40% deposit, but I'd like to think not!

Idiophreak

grifferz wrote: »

Don't you think that government action (i.e. outside the free market) should ideally not result in price inflation though?

It's hard to believe that the only thing that could be done to help people get on the housing ladder just happened to also result in prices going up again.

I just don't understand how the mechanics of your proposition would work.

If the government gave people free money for buying gold (or helped them get on the "gold ladder", if you will), what would happen to gold prices?

Anything the government does to help more people buy houses is going to drive prices up. So if the government wants prices to fall, they have to stop helping people altogether and look at other measures for bringing prices down.

The best way to drive prices down is to stop people from buying - make the banks require 50% deposits or crank interest rates up. Who would really benefit from the lowering prices, though? The rich (who could afford to buy even more property) and the banks (who'd make more interest)...which wasn't really the idea, was it?

Alternatively, the government could impact prices significantly by getting vastly more homes on the market. This either involves fast tracking major developments and new towns in the green belt or making more existing homes available - essentially destroy the rental market or target second homes. Make it prohibitively expensive (through taxation) to own more than one home and we'd see a flood of property available, a rapid fall in asking prices and increased "affordability". Although, of course, as the supply of rental would have been so rapidly reduced, the prices would go through the roof, which would make it harder for people to save a deposit...Interest rates would rocket, meaning mass repossessions for people who've bought in the last 10 years, which would cause prices to fall more, more rate rises...

Anything the government does has to be done softly softly - I'd suggest building more is a good idea and scrapping stamp duty would be a major step forward, too. As someone in a FTB property with the income to move up the ladder, I view stamp duty as being a major deterrent - which means my FTB property remains tied up by someone who should, really, be elsewhere by now...The government seem to think they'd be doing me a favour by letting me move on - whereas really it's the other way round.

grifferz

Idiophreak wrote: »

I just don't understand how the mechanics of your proposition would work.

I carefully did not make a proposition because I don't know how to solve it - I just feel like any intervention using taxpayer money, which continues to make prices go up, in turn using more taxpayer money, is not going to turn out well.

Idiophreak wrote: »

If the government gave people free money for buying gold (or helped them get on the "gold ladder", if you will), what would happen to gold prices?

They would go up and that wouldn't be good for the taxpayer who'd be backing the gold market?

Idiophreak wrote: »

Anything the government does has to be done softly softly - I'd suggest building more is a good idea and scrapping stamp duty would be a major step forward, too. As someone in a FTB property with the income to move up the ladder, I view stamp duty as being a major deterrent - which means my FTB property remains tied up by someone who should, really, be elsewhere by now...The government seem to think they'd be doing me a favour by letting me move on - whereas really it's the other way round.

I agree, that sounds like a much better idea than the government i.e. the taxpayer lending people some of the money that they would previously have had to lend from a bank.