Home ownership back to 1988 levels.....

shortchanged_2

Come on Hamish we all know why home ownership is so low now, it's all thanks to that housing boom we had in the previous decade fuelled by loose lending.

Unfortunately since the credit crunch and the banks long overdue realisation that their lending practices had been totally stupid and irresponsible we now have a situation where many people cannot get on the housing ladder any more.

It's obvious what is needed, a proper house price correction, where sensible deposits 10% or more and sensible income multiple mortgages. This may take some time and some people will get hurt along the way but if you want to blame someone, blame the banks and the property speculators of the previous decade.

moneyinmypocket

In an ideal world house prices would be affordable to everyone who earns a wage along with food, G,W,E etc however the horse has bolted from the barn and I honestly cant see a way back.

Think of a house like any other asest and think of it dropping back to mid/to late 90s levels - just cant see it happening.

The hope for low house prices is much like the hope for a world one day without poverty - for one reason or another it doesnt suit someone/something up at the top

shortchanged_2

shortchanged wrote: »

but if you want to blame someone, blame the banks and the property speculators of the previous decade.

Sorry I forgot to add Sarah Beeny and Phil and Kirsty.

AndyGuil

Interesting article. I would like to read some more. Can you put a link up to it?

I also find the rent more expensive than mortgage figure dubious, perhaps per household but certainly not per person.

homelessskilledworker

moneyinmypocket wrote: »

In an ideal world house prices would be affordable to everyone who earns a wage along with food, G,W,E etc however the horse has bolted from the barn and I honestly cant see a way back.

Think of a house like any other asest and think of it dropping back to mid/to late 90s levels - just cant see it happening.

The hope for low house prices is much like the hope for a world one day without poverty - for one reason or another it doesnt suit someone/something up at the top

I partly agree with your sentiment, only with a slight change...

In an ideal world we would save those that over borrowed/leveraged in the 2000's, but we can't forever.

Those that held out or just could not get on the ladder in the last ten years will now be able to take advantage of 25% lower prices or greater while those that did will find life a little more difficult.

Sometimes waiting is the financially more savvy option, ask your Gran and Grandad

ruggedtoast

homelessskilledworker wrote: »

You cannot continue with a system where people and families are trying to settle with them moving on every six months or allways with the threat they might get 2 months notice at anytime.

Todays BTL is a bad product that will need overhauling in the not t0o distant future.
In my view if we are going to keep some BTL(and I think we should) once a house becomes a rented property it stays as a rented property unless a substantial penalty is paid to take it out.

I can't see that ever happening to be honest. But there badly needs to be real reform of the system so that the buy to let industry is regulated in order to provide suitable, and affordable, long term housing for people that need it.

As it stands, it is designed to be as accommodating as can be for the short term investment aspirations of leveraged speculators and the banks who fund them, and devil take the hindmost. Which is always the tenant, stuck between the Hobsons choice of 6 month lets or "leap of faith" 2 year tenancies with no way out.

When I lived in Japan I had a year long rolling contract and was able to give a months notice at any time. Coincidentally most people in Japan are happy renting and most landlords have their eyes open, and are either giant companies or mom and pops with a few flats.

The breathless hand to mouth buy to let spiv, juggling his portfolio of half a dozen interest only properties on 6% loans where the maths only add up if no one's boiler breaks down is unknown there, and their country is all the better for it.

Unfortunately it appears that housing policy here is entirely arranged to suit this individual and even to breed more of him.

homelessskilledworker

ruggedtoast wrote: »

I can't see that ever happening to be honest. But there badly needs to be real reform of the system so that the buy to let industry is regulated in order to provide suitable, and affordable, long term housing for people that need it.

As it stands, it is designed to be as accommodating as can be for the short term investment aspirations of leveraged speculators and the banks who fund them, and devil take the hindmost. Which is always the tenant, stuck between the Hobsons choice of 6 month lets or "leap of faith" 2 year tenancies with no way out.

When I lived in Japan I had a year long rolling contract and was able to give a months notice at any time. Coincidentally most people in Japan are happy renting and most landlords have their eyes open, and are either giant companies or mom and pops with a few flats.

The breathless hand to mouth buy to let spiv, juggling his portfolio of half a dozen interest only properties on 6% loans where the maths only add up if no one's boiler breaks down is unknown there, and their country is all the better for it.

Unfortunately it appears that housing policy here is entirely arranged to suit this individual and even to breed more of him.

I made the point the other day that people should maybe get more proactive and drop manipulative money making sites like HPC.co.uk, this is a case in point.

Have a internet site called noyourrentalrights.co.uk, do not let landlords get away with anything that is not spot on and 100% correct. And while tenants are making the life of the dishonest and not so good landlord hell they could also be fighting for better housing/rental policy.

An internet site where those in rental know ther rights, more so those that actuallu use their working wage to pay for it.

Like a post pointed out this morning, there are now only 66% od people in OO, there must be millions who are now in rented, and many pi**ed off with the crap regulation.

DirtyDick

Home ownership is quite a recent phenomenon for the majority of people anyhow, especially for those in 'working class' fairly low paid jobs.

Prior to WW2 they might have lived in a dodgy house with a dodgy landlord, after WW2 they'd live in council houses, maybe de facto owners until they chose to move, then since the 1980s it's been expected that everyone will be able to afford to buy a house. Naturally, this leaves those born later than the 1970s in a bind as the houses were snapped up and increased dramatically in price as people were shoe-horned into the culture of buying one's own house at all costs.

Moreover, aside from private BTL, a lot of private housing stock that might have been suitable, especially for FTBs, has been used by local authorities to house people on benefits as there is insufficient council/social housing and they need to be put somewhere.

If supply and demand were truly matched, the government would be freeing up land and builders would be building to meet the demand and realise a 'realistic' (i.e. affordable) price that still covered their costs and gave them a profit, but this is just not happening.

How many established house owners rightly have a vested interest in keeping prices artificially high? What would happen to any government that sanctioned mass affordable housebuilding that witnessed a massive drop in house prices as demand dried up? Probably much the same reason as savers (such as for FTB deposits, but also rich older people sitting in comfortable houses) are being hammered by low interest rates, principally to protect those who jumped aboard the house-buying boat and cannot afford to pay more: it is seen as the least worst option.

abaxas

Workforce laziness appears to be directly proportional to home ownership levels.

Jimmy_31

HAMISH_MCTAVISH wrote: »

It is indeed.

A century ago, 90% of the houses in the UK were owned by just 10% of the people.

Property wealth was concentrated in the hands of the very few, and 90% of the population were "priced out".

The only thing that changed that was the expansion of credit.

Mortgage lending for the masses enabled more and more people to buy houses. Indeed, the absolute number of owner occupiers peaked in 2006 (although the percentage peaked a few years earlier).

And unsurprisingly, with credit now hard to come by, owner occupation is falling rapidly and wealth is once again being concentrated in the hands of an ever smaller and richer percentage of the population.

A lot of posters on here blame the expansion of credit (or "loose lending" as they like to call it) for driving up house prices.... Which is misleading.

What the expansion of credit actually did was drive up owner occupation rates, enabling more people than ever before to own their own home..... and because we have a massive shortage of housing in this country, that then drove up prices.

A point amply demonstrated by the fact that we have now withdrawn 65% of lending, yet prices remain at nearly 90% of peak levels.

Restricting lending has made only a small change to house prices, but it has had a devastating effect on a million or so people who have been prevented from buying their own home and forced into enriching a landlord instead.

The only way to enable those people to buy houses is to increase lending dramatically.

And of course the only "solution" for those who want cheaper house prices in the long term is to build dramatically more houses. But that's not going to happen as long as mortgage lending remains rationed. After all, builders won't build what they can't sell.

Restricting lending has made only a small change to house prices, but it has had a devastating effect on a million or so people who have been prevented from buying their own home and forced into enriching a landlord instead.

Completely incorrect for lots of people living in the north, Lots can now buy a house because prices have dropped by a large amount. (most are holding off for now though)

If the funny money tap gets turned back on then people will be prevented from buying a house because prices will go back up to a level that they cannot afford.

High house prices are not a good thing hamish.

I hope ford transit prices go up to 100k because i NEED one of them as well.