A generation are being priced in order to keep the value up of their parents assets.

Graham_Devon

ukcarper wrote: »

There are plenty of people who could afford to buy if they could get a mortgage.

OK.

I think it's best we agree to disagree? I don't disagree that plenty of people could buy a house if they were given credit. But I have just gone over, in detail to avoid issues such as this, the effects of this. It seems it's just glossed over and the same thing repeated again.

Can't keep going round in circles!

The days of 2007 are gone for a LONG time. We HAVE to look outside the other side of the box...we can't just keep repeating the same thing time after time when that thing is gone.

The evidence, for me, I believe is the various schemes the government have come up with to make entry into property as easy as possible. Lend a hand, First Buy, Newbuy. NONE of it has worked. No matter how "easy" they make it, it's still unaffordable, therefore the demand isn't there.

If what you said was true, and buyers would just buy, if only they had the access to credit ,Newbuy would be on fire. Frankly, it's not. We can keep calling for easier access to credit, but it's here and it's here now....but, that's not the issue, hence why all these schemes flop.

olly300

PasturesNew wrote: »

If money were borrowed, cheaper, to build social housing, without a developer profit, then rented out to cover costs, it'd be cheaper all round than doing it how it is now (BTL/private mortgages/everybody pocketing a wedge).

The government doesn't want the borrowing costs on the books so the only way to do it would be a PFI deal and we all know the problems with those.....

Graham_Devon

Oh, and before we agree to disagree carper

There is another angle on this, one which we never seem to discuss on here. One I bring up for sensible discussion point but I believe to be a huge factor right now.

There was an article on the news the other day about buyers in castle vale now stuck with their properties that weren't big enough. I think this is a key area we haven't explored.

In the boom, many were willing to take the credit and buy in, using it as a step up to the next property and so on. Value for money didn't mean as much when you thought what you were buying was a fast track to wealth.

Today that has changed. It's no longer a fast track to wealth. It's no longer a step up. Potential buyers now see value for money as a much large factor.

Therefore the government can pump as many schemes as they like. They can invent money for lending at lower costs. But it doesn't matter. Without that fast track that HPI served up, value for money is now key. Potential buyers see themselves buying a house to live in for a lot longer, with a lot less paper profit on the horizon.

Selling at 2007 prices today is a lot harder when value for money is much higher up the agenda than it was in a blur of rampant HPI. Therefore, it doesn';t matter how much you lend, or how easy you make it.....the demand isn't there at the cost of the house + the debt. The value for money simply isn't there, and it's much harder to sell at 2007 prices without 2007 price rises.

This is why all these schemes making credit and access easier simply flop. (IMHO).

ukcarper

Graham_Devon wrote: »

OK.

I think it's best we agree to disagree? I don't disagree that plenty of people could buy a house if they were given credit. But I have just gone over, in detail to avoid issues such as this, the effects of this. It seems it's just glossed over and the same thing repeated again.

Can't keep going round in circles!

The days of 2007 are gone for a LONG time. We HAVE to look outside the other side of the box...we can't just keep repeating the same thing time after time when that thing is gone.

The evidence, for me, I believe is the various schemes the government have come up with to make entry into property as easy as possible. Lend a hand, First Buy, Newbuy. NONE of it has worked. No matter how "easy" they make it, it's still unaffordable, therefore the demand isn't there.

If what you said was true, and buyers would just buy, if only they had the access to credit ,Newbuy would be on fire. Frankly, it's not. We can keep calling for easier access to credit, but it's here and it's here now....but, that's not the issue, hence why all these schemes flop.

You always go back to implying that people want lending to go back to what it was in the boom which isn’t the case. If salary multiplies and self cert were a problem which I personally think they were I can’t see that making mortgages available with a reasonable deposit and strict lending criteria would cause another boom but it would allow people who could afford to buy to buy. Of course that won’t happen because of the banks lack of funds and if prices fell enough to make any appreciable difference the damage to existing owners and the economy in general would be enormous.

Graham_Devon

wotsthat wrote: »

When someone says improved lending would allow people who can afford a mortgage to buy a house how come you only hear "we should go back to the lending conditions of 2007 - oh the horror!"

Because we already have 90% mainstream lending, and 95% government backed lending.

To improve lending further for affordability, you would have to go back to 2007 lending standards. How else can you possibly make it easier without touching the lending levels back then?

If someone can't hit the affordability requirements of a 90% mortgage, the only thing you can do is lower the requirements. Thats 2007 all over again.

ukcarper wrote: »

You always go back to implying that people want lending to go back to what it was in the boom which isn’t the case.

Answered above.....so what is the case? What lending do you want to see that isn't boom level lending, but is easier than 90% & 95% lending? Describe it to me.

olly300

ukcarper wrote: »

You always go back to implying that people want lending to go back to what it was in the boom which isn’t the case. If salary multiplies and self cert were a problem which I personally think they were I can’t see that making mortgages available with a reasonable deposit and strict lending criteria would cause another boom but it would allow people who could afford to buy to buy. Of course that won’t happen because of the banks lack of funds and if prices fell enough to make any appreciable difference the damage to existing owners and the economy in general would be enormous.

One thing you have ignored is job insecurity.

If you are at risk of losing your job - and many people still are - then you aren't going to rush to buy a house.

ukcarper

olly300 wrote: »

One thing you have ignored is job insecurity.

If you are at risk of losing your job - and many people still are - then you aren't going to rush to buy a house.

I agree lots of reason why people aren't buying but i think reducing house prices 10% would make very little difference.

ukcarper

Graham_Devon wrote: »

Because we already have 90% mainstream lending, and 95% government backed lending.

To improve lending further for affordability, you would have to go back to 2007 lending standards. How else can you possibly make it easier without touching the lending levels back then?

If someone can't hit the affordability requirements of a 90% mortgage, the only thing you can do is lower the requirements. Thats 2007 all over again.




Answered above.....so what is the case? What lending do you want to see that isn't boom level lending, but is easier than 90% & 95% lending? Describe it to me.

So the article you linked to is rubbish and there isn’t a shortages of mortgages.

Loughton_Monkey

Graham_Devon wrote: »

......Don't expect any answers on this article, but do expect to see lots of home truths about the current problems of trying to bolster up existing owners assets and construction companies profits.

http://www.guardian.co.uk/commentisfree/2012/sep/02/housing-crisis-home-economics-editorial

Since when has a Guardian article ever given any 'answers'?

It is a squalid, left wing, socialist, namby-pamby rag, read by namby-pamby, pinko, "New Labourites" who think that the sun shone out of the back side of Brother Brown.

Seems like an article aimed at slamming the cap on housing benefit.

The Guardian readership are living examples that you can be 'educated', without being, by any normal definition, intelligent.

Graham_Devon

ukcarper wrote: »

So the article you linked to is rubbish and there isn’t a shortages of mortgages.

Come on carper....answer the question.

How can you make lending easier to achieve for buyers, without going back to 2007 levels?

I'm interested as it's stated so much, and you have taken issue with me saying it would be doing more of the same that led us to problems.

So what are your solutions that don't go back to 2007 levels. As said many times, we have government backed 95% LTV lending. We have 90% lending. We have councils making it very easy to get funding, at least one with 100% lending and a furniture grant, and they STILL couldn't shift the flats.

What do you think could be done to make it even easier than that?

You can't force people to take on lending if they don't see value for money.