Debate House Prices


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Impact of Housing Benefit Cuts

24

Comments

  • Theone1_2
    Theone1_2 Posts: 25 Forumite
    The figures suggested that there would be an impact in about half of all London boroughs, and about 20,000 households would be affected. That, however, is only the effect of the cap, and not the reduction to 30% of average rents.

    The majority of houses affected by the cap are 4 bed or larger. There may well be a reduction in the Market value of these properties, but that ain't going to do much for the average FTB. The borough with the most properties affected is Westminster, I think about 5,000 LHA claims over 400 per week. The price of a 4 bed property there is still going to be completely unaffordable even with sharp falls in price.

    What will happen to all houses 4 bed houses will they find someone to rent out of their own pocket?
  • chewmylegoff
    chewmylegoff Posts: 11,466 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Well if they can't they'll either lower the rent or sell them.
  • Theone1_2
    Theone1_2 Posts: 25 Forumite
    Well if they can't they'll either lower the rent or sell them.

    Some of these families were getting up to 4K per week. These props holding up house prices will be taken out and there is a long way to fall.
  • chewmylegoff
    chewmylegoff Posts: 11,466 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Theone1 wrote: »
    Some of these families were getting up to 4K per week. These props holding up house prices will be taken out and there is a long way to fall.

    perhaps 4 bed properties in westminster will fall in price, but i doubt this will have a generalised knock on effect across all property in the area, and it seems unlikely to have much effect at all outside london.
  • Theone1_2
    Theone1_2 Posts: 25 Forumite
    It will have knock on affect on all of London and then on average rents and house prices for all of the UK.
  • chewmylegoff
    chewmylegoff Posts: 11,466 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Theone1 wrote: »
    It will have knock on affect on all of London and then on average rents and house prices for all of the UK.

    why? the price of a 4 bedroom house in inner london has not, up until now, had any bearing on the price of a 2 bedroom flat in carlisle.

    why do you say so confidently that this is all about to change?

    i very much doubt it will even materially impact on the price of 2 bedroom flats in london, let alone in carlisle.
  • ukcarper
    ukcarper Posts: 17,337 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Theone1 wrote: »
    Some of these families were getting up to 4K per week. These props holding up house prices will be taken out and there is a long way to fall.

    I wonder how much they are propping up house prices in Kensington and Westminster.
  • neverdespairgirl
    neverdespairgirl Posts: 16,501 Forumite

    Given that housing is a primary need, and housing is in such short supply that rents are soaring by over double the rate of wage inflation, I'd be prepared to bet that landlords will tell their tenants to "jog on" and find the money from some other part of their budget. ;)

    Housing is definitely a priority. But a lot of people could downsize if they had to, and still be housed.

    For example, we are renting a small-ish 3 bed flat at the moment, and about to buy a big 3 bed flat. As a couple with 1 child, we don't "need" a large 3 bed, we want it (and are able to pay for it).

    My parents have a large 6 bed, 4 reception room house, with 4 bathrooms. At one time, there were 7 people living there. Now it's just my parents. They certainly need somewhere to live, but it could be a smaller somewhere.
    ...much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.
  • Theone1_2
    Theone1_2 Posts: 25 Forumite
    Housing is definitely a priority. But a lot of people could downsize if they had to, and still be housed.

    For example, we are renting a small-ish 3 bed flat at the moment, and about to buy a big 3 bed flat. As a couple with 1 child, we don't "need" a large 3 bed, we want it (and are able to pay for it).

    My parents have a large 6 bed, 4 reception room house, with 4 bathrooms. At one time, there were 7 people living there. Now it's just my parents. They certainly need somewhere to live, but it could be a smaller somewhere.

    Yes more people will be forced to downsize as the cuts come in. Then their old big houses will somehow house even more people.

    The fact is these cuts coming in will bring down the average rents and house prices. If they come in just as interest rates go back up and many more distressed sellers then we could see significant falls.
  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    a lot of people could downsize if they had to, and still be housed.
    .

    Indeed.

    Just like all those single FTB-s complaining they can't buy a 3 bed semi on the average wage could start with something smaller....;)
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”

    -- President John F. Kennedy”
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