Self-build: Should people build their own homes?

HAMISH_MCTAVISH

shortchanged wrote: »

Whatever Hamish. You know damn well that the loose lending during the boom continued to fuel the rampant HPI that was evident, if you can't see that............well, there's no hope.

Absolutely determined to stick to the old dogmatic hpc memes, aren't you?

Even the hpc-ers are now coming around to reality.

The primary cause of house prices, and high rents, in the UK is a massive housing shortage.

You constantly state it's lack of housing, however during the boom years buildings were going up left, right and centre and yet house prices still rose.

And it was still nowhere near enough.

The UK needs around 275,000 houses a year to be built just to keep up with rising population and household formation.

If you want to eradicate the existing shortage as well, you'd need 300,000 houses a year.

We built 104,000 last year..... And never got to 300,000 even in the boom years.

Just to be clear, in the next 20 years we need to build a city the size of London just to keep house prices down to today's levels in real terms..... We're on track to build a city the size of Glasgow. With virtually zero chance of much improvement.

Why?? Because the properties were being marketed at that price and the banks were willing to lend the money to pay those stupid prices, which of course has now all backfired. This and combined with the fact that there is a mentality in the UK of many seeing property as an investment.

You're an idiot if you believe that.

Banks don't lend money to pay rent.... There is no credit fuelled rent bubble. Yet rents are at record highs despite the recession, unemployment, economic uncertainty, austerity, public sector wage freezes, and declining income in real terms.....

If there was no shortage of housing, that simply wouldn't be the case.

What you crashaholics repeatedly fail to understand is that not all large price increases mean a market is in a speculative bubble. A genuine supply/demand imbalance can have the same effect on prices. Quite clearly the UK was not in a speculative bubble, as we removed 65% of lending and 100% of "irresponsible" lending, and prices are down just 10%.

It's absolutely self-evident.

I have no idea why I bother to argue with you, or why you are so determined to convince yourself otherwise.

shortchanged_2

So how do you explain a stagnant market now Hamish?

Pee

My friend did a self build with her husband who was in the building trade and although the plot was pretty expensive, and this was a few years ago, the build itself was reasonably cheap - his mates did a lot at reduced rates - and the quality was great. She didn't end up with exactly what she wanted, she said she'd do it better next time! Fortunately they had sold a house with hardly any mortgage so didn't have the issues with financing it that I have seen.

HAMISH_MCTAVISH

shortchanged wrote: »

So how do you explain a stagnant market now Hamish?

MORTGAGE RATIONING!!!!

Jeez, how many times do I have to say it.

If you remove 65% of mortgage lending from a market and there is no shortage but a surplus, prices should plummet by a massive amount.

Like the 48% they are now down in Ireland, for example.

The very fact they are stagnant in the UK, whilst rents are soaring instead, is absolute proof of the housing shortage.

Return us to historically normal, sensible, prudent lending standards, the same as I was offered in 1990 and my parents were in 1967, and prices would be rising. But this is also the only way you'll get significantly more houses built.

hillcats

The whole thing is a bad move IMHO, we already have enough cowboy wannabe builders without adding more...
Lets just say that I know one or two shady characters whom I wouldn't trust to build my daughters lego blocks.
Just like most jobs, leave it to the pro's.

abaxas

HAMISH_MCTAVISH wrote: »

MORTGAGE RATIONING!!!!

Jeez, how many times do I have to say it.

If you remove 65% of mortgage lending from a market and there is no shortage but a surplus, prices should plummet by a massive amount.

Like the 48% they are now down in Ireland, for example.

The very fact they are stagnant in the UK, whilst rents are soaring instead, is absolute proof of the housing shortage.

Return us to historically normal, sensible, prudent lending standards, the same as I was offered in 1990 and my parents were in 1967, and prices would be rising. But this is also the only way you'll get significantly more houses built.

The issue with the 'mortgage rationing' argument is this..

Eat normal meal - normal times
Eat far too much at a all u can eat buffet - boom times
Eat normal meal as you cant afford the all u can eat buffet- normal times.

There is rationing relative to what was before, but not relative to what was before that. The market has got 'worse' but that also doesn't mean the period before was actually 'better'.

We would be having a summer if god hadn't decided on 'sunshine rationing' :P

shortchanged_2

HAMISH_MCTAVISH wrote: »

MORTGAGE RATIONING!!!!

Jeez, how many times do I have to say it.

If you remove 65% of mortgage lending from a market and there is no shortage but a surplus, prices should plummet by a massive amount.

Like the 48% they are now down in Ireland, for example.

The very fact they are stagnant in the UK, whilst rents are soaring instead, is absolute proof of the housing shortage.

Return us to historically normal, sensible, prudent lending standards, the same as I was offered in 1990 and my parents were in 1967, and prices would be rising. But this is also the only way you'll get significantly more houses built.

Thanks for answering my point Hamish.

As you are obviously admitting that the availability of mortgages has an effect on house prices, albeit affecting supply and demand.

The reason why house prices are staying stubbornly high is mainly due to the low interest rates resulting in very few forced sellers, this and of course people not wanting to lose money on their investment.

shortchanged_2

HAMISH_MCTAVISH wrote: »

MORTGAGE RATIONING!!!!


Like the 48% they are now down in Ireland, for example.

Ireland had an even more severe property boom than in the UK, therefore there was always going to be a bigger pop when it all went ti*s up.

HAMISH_MCTAVISH

shortchanged wrote: »

As you are obviously admitting that the availability of mortgages has an effect on house prices, albeit affecting supply and demand.

I've never said it didn't.

But what I have said is that the factors you blame for the boom are not the primary cause.

A genuine supply and demand imbalance will cause the same price rises as a speculative bubble. If you want to know which is which, take the funding away and see which one falls off a cliff, and which one stabilises at a level slightly below peak.

The reason why house prices are staying stubbornly high is mainly due to the low interest rates resulting in very few forced sellers

Ireland has low interest rates. Prices are down 48%.

Northern Ireland has identical interest rates and monetary policy to the rest of the UK. Prices are down 45%.

Your arguments are going up in smoke here.....;)

this and of course people not wanting to lose money on their investment.

I see. So the Irish people wanted to lose money on their investments, so that's why prices have fallen there by more than 4 times the amount of here...... Interesting.

I don't suppose this might have something to do with it......

Housing vacancy rate:

Ireland = 17% and rising

UK = 3% and falling

HAMISH_MCTAVISH

shortchanged wrote: »

Ireland had an even more severe property boom than in the UK, therefore there was always going to be a bigger pop when it all went ti*s up.

The USA had a much smaller boom, in price terms, than the UK.

They are down 38%, despite ZIRP, bank bailouts, liquidity schemes, and help for homeowners.,

I don't suppose this might have something to do with it.....

Housing Vacancy Rate:

USA 13% and rising

UK 3% and falling