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Debate House Prices
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Generation Rent a "ticking time bomb" for housing benefits
Comments
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Once again you're quoting your own opinions as if they were gospel, and once again they are completely wrong. In contracting margins are single digit thin percentage wise, but this is in reference to the civil sector, commercial building, hospitals, schools, studios, major refurbishments etc.
Housebuilders profit margins are much higher, between 20-30%. If you seriously think housebuilders could possibly stay afloat by selling houses on a 1% margin, I will have some of what you're drinking.
Housebuilding is a completely different business model to contracting.
Wrong again socky....
The major house builders are posting net profits in the single digits.
Their accounts are public. Go look it up.
Gross margin on any individual sale does not equal net profit for the company. Yes, they have economy of scale on building material and design costs, but they also have big overheads to pay to reach that economy of scale.
They simply cannot drop prices by a meaningful amount and stay in business. A few percent, sure. But that's not going to help stretch the limited mortgage funding very far..... So most people still won't be able to buy.“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”0 -
HAMISH_MCTAVISH wrote: »Profit margins for all the major builders are in the single digits in percentage terms.
I wonder how their margins would look if the salaries of their staff were adjusted.
During the boom, I knew of £300 day rates for tradesmen. 3 x 100 £ a day. Now, that's a very decent rate, I reckon. No wonder prices reached the levels they did.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
Just when are you going to figure out that people can't just take on ever increasing amounts of debt Hamish?
The threads statign the same thing over and over and over and over again are tedious.0 -
Actually plot and build costs are not very high at all.
About £1000 per sq metre for build costs in houses, slightly less in flats. Plus land, services, and government bribes towards new schools, roads, etc.It's planning permission which is the largest part. Something that only exists as a concept.
This is why 2 bed flats of similar volume are £54k new in once place, while £250k in another.
Nope.
Planning permission costs pretty much the same to push through nationally.
The difference in land costs are nothing to do with PP and everything to do with differentials in supply/demand.
It's why a 3 bed victorian terrace can cost 600K in London and an identical 3 bed victorian terrace can cost 60K in Preston.“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”0 -
Graham_Devon wrote: »The threads statign the same thing over and over and over and over again are tedious.
Nowhere near as tedious as the several thousand threads about impending doom you've posted in the last 4 years that have totally failed to materialise.... :rotfl:“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”0 -
there's no shortage of new housing in my town. there's loads. but no f**ker can get a mortgage!!! saving for a deposit, while renting AND supporting a family is nigh on impossible.0
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HAMISH_MCTAVISH wrote: »Nowhere near as tedious as the several thousand threads about impending doom you've posted in the last 4 years that have totally failed to materialise.... :rotfl:
Says he.... complaining about the effects of the very things that have materialised.
Silly boy.0 -
Much as I am loathe to admit it, McTavish does have a point. I know many people paying well north of £1000 a month in rent to private landlords who cant get a mortgage for less than that because they dont have a deposit.
They dont have a deposit because they are paying well north of £1000 a month to private landlords.
Swapping a housing bubble fuelled by over high lending for one characterised by over high rental prices is not exactly desirable.0 -
ruggedtoast wrote: »Swapping a housing bubble fuelled by over high lending for one characterised by over high rental prices is not exactly desirable.
But it's the inevitable result when the price rises were caused by a critical housing shortage, and it turns out it wasn't a bubble after all.
The reason central banks don't target asset prices is because a genuine supply/demand imbalance and a speculative credit driven bubble will both cause prices to rise equally high.
But when you remove 70% of the credit, have a recession, unemployment, etc, and impose strict mortgage rationing.... yet prices barely fall and rents soar....
It becomes clear it wasn't a bubble at all, just a good old fashioned supply shortage.“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”0 -
Hate to say it but I wonder if this is going to be the norm. youngsters in my family have very little chance of buying. The ones that have, imho are pretty much on a knife edge. Just one to loose their jobs and the trouble starts.
Add to that all the other commitments people have, it looks bleak right now.
Not sure I agree with Hamish. Why are interest rates so low? Clearly an attempt to keep people in their homes amongst other things. Certainly the industry I have retired from is suffering badly.
If renting for many becomes the way, then it is imperative that regulation has to be changed.0
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