House Price Crash within 2 years???????

UK007BullDog

Some people wish for a property crash and hope to buy. But what they forget is that when/if there such a crash it is due to the economy suffering as well. So a lot of people might be out of work and then could not buy either.

Gorgeous_George

...and the most likely cause of a crash is higher interest rates.

Unless I'm mistaken, that means property is less affordable for EVERYONE.

Much better if the crash can be caused by increased house building or a population reduction. So, bird flu it is.



GG

Pobby

tawnyowls wrote:

I absolutely agree with you. Unfortunately, I think it's so far gone now that without rules to change how many properties people can own, even a crash won't stop it. I am constantly shocked when I hear about people owning hundreds of properties (there's one couple who, last time I read, owned over 450 and were buying one a month!). Property isn't like other commodities - if you wanted to buy a particular pair of shoes but couldn't afford them, you could just buy a cheaper pair; you wouldn't have to move to a different area of the country just to buy them. I have nothing against people owning a small number of other properties and renting them out (for many people, it's their pension), but who needs hundreds? Or even dozens? What that does is stop other people being able to buy their own home, so they have to rent - the rental yields go up, thus encouraging the buy-to-letters to buy yet more properties, which stops yet more people buying, up goes the rental yields, etc; it's a vicious circle. Even if there is a crash, the BTLs will have made so much money that they'll be able to buy yet more property at cheaper prices, and even though the rental yields might go down because other people will be able to buy (if they can beat the BTLs to it), the prospect of capital growth will make it worth the BTLs' while to hang onto their property. If things get serious, the little guys (Ma and Pa with their one house that's their pension) might not be able to afford to keep up the payments, but the big boys will just sell a few of their massive pension portfolios to keep themselves going and then buy again when rental yields rise.

We are creating a new generation of landowners, and squeezing the little people out. This cannot be right, and as pointed out by others, it's a serious disincentive to work hard and 'better yourself'. At a town meeting recently, one of the speakers suggested there should be a cap placed on the number of properties any one person is entitled to own, and the response was almost unanimous agreement (most reckoned no more than 10) . If that were evern to happen (unlikely with this government, who have succeeded in making Animal Farm a reality), it would be interesting to see if the government's stance that only a small percentage of property is rented would actually be true; their other numbers (eg on mass immigration, currently estimated by other groups at over 600,000/year, were wrong by a factor of 40)

My goodness.How right you are.It really is like ``Animal Farm``.I come from a long line of Labour party members,activists and supporters.Also a good number of years ago I resigned from the party.Many of my friends,some of whom have held fairly high positions at a local level are now non supporters.This government has created even further divisions between the rich and poor.To a fairly large degree this is because of the high cost of housing.The youngsters in my family{although I live in Devon} live in the south east.Not only are their chances of home ownership is very slim,they have little hope of renting something which is half decent.

The selling off of council stock was foolish.I remember my late father-in-law saying would I like to buy his{very nice } for 12k in the early 80`s.Well as a good little socialist I refused as it was against my beliefs.

Another point.As a middle aged tax payer I object to the way that housing benefit is organised.If there were council house I would suppose that as the rents were fairly low then it would be a smaller burden on the tax payer.However with so many living in the private sector the tax payer is paying out a much higher figure.

pingua

Perhaps the housing asses and councils should buy up all the cheepo houses (that come about in the crash) to replace their lost stock.

Guy_Montag

pingua wrote:

Perhaps the housing asses and councils should buy up all the cheepo houses (that come about in the crash) to replace their lost stock.

I can certainly see that happening to "luxury" flats that have popped up all over the shop.

scorpio_princess

Gorgeous_George wrote:

So, every BTL gets sold. What about Housing Association homes? Should they be sold as well. Let's make renting illegal while we are being pathetic.

IF every BTL was sold, there would be an equal number of additional buyers (those people who formerly chose to rent BTL properties).

There stll would not be enough houses for our expanding population. More people would need to pay Stamp Duty, EA fees, etc., when they moved house. More people would be tied into long term debt via mortgages.

I think it is time that the BTL bashers got back under the stones that they came from - only to re-emerge when they grow up.GG

Nobody said anything about making BTL illegal! Your argument about every BTL being sold is a little absurd to say the least. All that was said is that there should be either a cap on the number of properties any one person can own or higher CGT for such people. Housing Association homes are a completely different kettle of fish - for a start, you can't be turfed out of a HA home if your LL decides he wants to sell up. Also, your rent isn't being used to ultimately line the pockets of someone else - if you don't see how this can cause resentment then you need to try to see things from the point of view of a renter priced out the housing market.

Pathetic? I don't think so. That's what people with no further valid argument like to say in order to patronise. We are debating here, are we not? And any debate should consist of all views, without being told to - and i'm paraphrasing here - 'go back under the stone you come from and emerge when you've grown up'.

talksalot81

Gorgeous_George wrote:

...and the most likely cause of a crash is higher interest rates.

Unless I'm mistaken, that means property is less affordable for EVERYONE.

Much better if the crash can be caused by increased house building or a population reduction. So, bird flu it is.



GG

It makes property less affordable for those whose equity is in property. There are other forms of equity which will not crash if interest rates rise...

tawnyowls

Alan_M wrote:

Damn this is turning into a conspiracy theory thread.

The BTL figures are provided by the mortgage lenders and not the government so I'm not sure here that leaves your argument, anyhow, I would have thought it would have been in their interest to promote BTL showing how buoyant the housing economy is as an investment....just a thought.

Just because you're paranoid doesn't mean ...;)

I think it supports it, if anything. If you're a small BTL, owning a single additional property, the likelihood is that you'll have had to take out a buy-to-let mortgage, so that property will be recorded as being bought specifically to let. However, if you own a big portfolio, you'll probably have the money to put down a large cash deposit and thus be able to take out a normal mortgage. Hence, the figures will show you're not a BTL, even if you own 600 properties and rent them all out. Figures showing the number of properties actually rented might reflect the true situation more accurately.

scorpio_princess wrote:

Nobody said anything about making BTL illegal! Your argument about every BTL being sold is a little absurd to say the least. All that was said is that there should be either a cap on the number of properties any one person can own or higher CGT for such people. Housing Association homes are a completely different kettle of fish - for a start, you can't be turfed out of a HA home if your LL decides he wants to sell up. Also, your rent isn't being used to ultimately line the pockets of someone else - if you don't see how this can cause resentment then you need to try to see things from the point of view of a renter priced out the housing market.

Absolutely - banning BTL completely was the furthest thing from my mind (I have every intention of buying a second property as my pension). I just feel that people shouldn't stop other people having opportunities just because they were lucky enough to be able to get into a market that was favourable (and as pointed out earlier, artificially favourable, due to the government selling off houses, which benefited people who didn't need it at all - who hasn't been cheesed off every time Christine Hamilton boasts of the 40 grand profit she made?). Someone else mentioned that people could form companies and own them through that - I forgot to say that in the meeting I mentioned, a ban on companies owning residential property was also suggested; they could invest in commercial property, but not residential (obviously, there would have to be changes so that for instance, leaseholders who've formed a company to manage the block of flats that they actually live in wouldn't be penalised, and for special circumstances such as tenant farms on an estate and similar things). Housing associations and similar organisations are of course a completely different kettle of fish;they have in many areas taken over the responsibility of social housing from the councils, so they wouldn't count as companies (they've usually got charitable status anyway).

Obviously, for such a situation to happen (unlikely with so many government pigs with their snouts in this particular trough, but let's imagine), you couldn't stop it straightaway - the housing market would collapse and as pointed out, a lot of people would be homeless. In this ideal world (hah!) I'd pass the rule on companies first (to stop individuals using that loophole) and individuals with over 1000 properties (a block of 60 flats would count as 60 properties, not 1) and give them 5 years to dispose of their stock (seeing as I don't trust the statistics). Then would come individuals with more than 750 properties, and so on till we got to a reasonable number (say 10). Obviously, it would be possible for a married couple to hold 20 properties, and their kids to hold 10 each, but I think that's acceptable. I reckon a lot of people would find such a system just and fair.

Oh well, back down to earth, now!

BTman

Gorgeous_George wrote:

I think it is time that the BTL bashers got back under the stones that they came from - only to re-emerge when they grow up.



GG

You may be gorgeous, but under your skin you are very ugly.

pollyanna24

What's wrong with secretaries earning £40K?