BTL Mortgages now 12.4% of all mortgages and safer bet

the_flying_pig

HAMISH_MCTAVISH wrote: »

Do you have some data to back up that assertion.... I thought it was 2005 that O/O percentages peaked?

And are you referring to absolute numbers of homeowners, or owner occupation as a percentage of total households?

Because obviously with growing population, increasing household formation, and house building failing to keep up even in the boom, let alone now, it is entirely possible in theory for the number of houses in owner occupation to grow whilst the percentage in owner occupation decreases. Up until the crash anyway....

Although I'll agree it's probably falling on both measures now, for obvious reasons.

I've seen 2003 figure quoted quite often in the mainstream press. I've no idea if it's right or not

[checks]

Seems like it might be.

http://www.rics.org/site/download_feed.aspx?fileID=8374&fileExtension=PDF

This is a % figure rather than absolute number but I'm not sure this is hugely relevant - it is a fact that the proportion of purchases accounted for by BTL was already on the increase quite some time before the peak of the credit bubble.

geneer

HAMISH_MCTAVISH wrote: »

Do you have some data to back up that assertion.... I thought it was 2005 that O/O percentages peaked?

Oh now you require evidence.

No comment on this gem I see.

"If you consider the buy-to-let recovery alongside the increase in first-time buyer numbers we published yesterday, it appears that first-time buyers are not being displaced by buy-to-let landlords but are holding their own in a restricted market

.

Unsurprising. Given how it negates oh around 90% of what both you and Julieq have been bombarding the boards with for the last few months.:rotfl::rotfl::rotfl:

geneer

JonnyBravo wrote: »

No change, he buys 4?

Anyway you've got him all wrong jules.
I know you'll appreciate an update.

https://forums.moneysavingexpert.com/discussion/3391286

Post 7 onwards.
Great at maths.

:rotfl::rotfl::rotfl:Oh dear.
Is this still the best you can come up with.
Exquisite.

Strangely you don't appear to have a problem with Hamish delivering Halifax figures for August, in the 1st week of August.

Tee hee.

geneer

robmatic wrote: »

'All mortgages' is a lot of mortgages.

Apologies. It I appears as of I did not pick up on that particular aspect. Perhaps because BTL as a % of "All mortgages" is a measure so pointless that it is difficult to conceive of its existence.

Anyhow, as has been noted, Julie Q failed to point out the most important part of the article (perhaps why she did not link the same).

http://www.bbc.co.uk/news/business-14488734

"If you consider the buy-to-let recovery alongside the increase in first-time buyer numbers, it appears that first-time buyers are not being displaced by buy-to-let landlords but are holding their own in a restricted market," Mr Smee said.

Bang goes the theory eh. :rotfl:

HAMISH_MCTAVISH

the_flying_pig wrote: »

This is a % figure rather than absolute number .

Yes, you're right. Owner occupation as a percentage of households peaked in 2003 at 70.9%, according to CML.

Although owner occupation in absolute numbers of households peaked in 2006 at 14.8 million according to DCLG. (England only, can't find UK-wide stats)

So the number of households in owner-occupation kept rising until 2006, but they made up a smaller percentage of a bigger population.

From 2007 onwards the number of O/O households has declined.

Graham_Devon

julieq wrote: »

So restricting lending, far from making lending safer - default rates have always been tiny here - just pushes up accomodation costs for those not already homeowners. Be careful what you wish for in other words. This is the difference essentially between here and Eire or the US where there is massive oversupply against need and where prices have fallen through the floor, despite in the US at least very similar relief measures having been taken to here.

You want to be careful with this.

While restricted lending, AT THE MOMENT in the period of the last couple of years, has pushed up accomodation costs, this has not always been the case in history, and will not neccesarily be the case pushing forward.

The above has been able to happen due to all the other measures which have taken place. Restricted lending on it's own, would not neccesarily push accomodation prices up....so this is an argument you are able to make only because of the other factors which you fail to mention.

On a seperate point, you state restricted lending pushes accomodation prices up, and be careful what people wish for. BUT, we all know full well, extra lending would push prices up too, as we have just lived through a decade where excessive (or whatever you wish to call it) lending has seen asset prices outstrip any alignment between asset prices and household income.

Therefore, the argument that restricted lending pushes accomodation prices up doesn't really wash, as more lending will do the same.

What we have at the moment is something very much like the stock market. We've seen that fall, and rapidly recover, partly with the aid of stimulus (QE money). It's now bouncing around with massive drops and falls, even massive intraday fluctuations. Why? Because it has been noted that debt cannot solve debt problems.

Very much the same as housing. Extra credit can not solve the problems too much credit has bought.

So to sum up, your argument is fine, but it can only be made in a viable market via ignorance of all the other factors currently present in the market.

Thrugelmir

Graham_Devon wrote: »

lending has seen asset prices outstrip any alignment between asset prices and household income.

On which the myth of "2.9%" was born. If the figures are properly analysed the decades show a totally different picture.

So future investors are likely to be disappointed by returns. Which in itself may have an impact on the very market they are investing in. As the penny drops.

Graham_Devon

Thrugelmir wrote: »

On which the myth of "2.9%" was born. If the figures are properly analysed the decades show a totally different picture.

So future investors are likely to be disappointed by returns. Which in itself may have an impact on the very market they are investing in. As the penny drops.

Yup, people, be that bulls, bears, on most investment types appear to focus on one or two points, but ignore many other points.

It's the same on the share boards. I've seen people analyse company records and viability on the share boards, only to be put on ignore by fellow holders after verbal abuse. But the point was a good one. Funding may have been allocated for X, but Y remains to be funded, and without X and Y, the project falls down.

For the housing optimists, it appears to be lending, and supply. Supply is a bugbear of mine as it keeps being bought up, but ignorance is awash here. "Prices can't fall because of tight supply". That implies that the population has increased 2 fold over the last decade, which is clearly not true.

Population has increased approx 4% since 2001. http://www.statistics.gov.uk/cci/nugget.asp?ID=950

House prices have increased approx 102% since 2001 (Nationwide data).

Sorry, but the two do not correlate enough to suggest supply will stop prices dropping form here. Sure, there are other factors, such as the way we live now, (more single households etc), inflation etc, but even including that, the numbers don't add up enough.

It's many MANY factors making the price what it is currently. But I believe housing benefit to be the biggest one. It's a massive stimulus package to a significant number of properties.

The US comparison is ALWAYS bought up. But remove housing benefit from the country and our house prices would fall far more than the US.

Too many factors are being completely ignored when making blanket comparisons to other countries with vastly varying policies.

geneer

HAMISH_MCTAVISH wrote: »

Yes, you're right.

Nuff said.

geneer

Graham_Devon wrote: »

While restricted lending, AT THE MOMENT in the period of the last couple of years, has pushed up accomodation costs, this has not always been the case in history, and will not neccesarily be the case pushing forward.

This has been mentioned to Jules before. The markets must always find an equilibrium, and short term trends are part of the readjustment, not a new status quo.