Will they ever learn?

namiku

demontfort wrote: »

Selfish = Honest and Fair. Why should the government waste money helping out people who are in a position to manage by themselves but too impatient to save up for a deposit. There are far more deserving cause than FTBs.

Patronising and Smug = Direct and Blunt. Don't even know what this fella is going on about, I think he needs a dictionary.

Impatience has nothing to do with it. Its simply too difficult to save up a big enough deposit for an affordable mortgage.

The cost of living together with the house prices have risen way over the wage increase in the past 20 years.

I'd like to know about your situation and how you managed to afford a home and also what do you think the money is better spent for, rather then helping the taxpayers while boosting the economy?

somethingcorporate

namiku wrote: »

You're actually quite wrong.

A lot of people are ready to make a financial commitment but what they lack is capital which is not easy to come by in this day and age.

I will use my example to show you what I mean. Me an my wife have a joint income of £50k with no dependents. We have been renting for a few years and have been paying in the range of £700-£800 per month on rent alone. We live a very fulfilling and enjoyable life. We feel it is the right time to buy a house and start a family however we lack capital required for a deposit. Using he HTB scheme we would be putting down 5/10% deposit plus 20% from the government (interest free for 5 years), and need a mortgage of 75%. Upon calculations with our mortgage advisor the monthly repayments for our mortgage would be £735. This is £15 cheaper then our current rent payment. If we were to add a payment of around £60 after 5 years for the loan (we plan to save and pay 20% of it before the 5 years anyway) and taking into consideration the fact that we would have paid some of our mortgage in that time as well the repayment would not go over £800.

Do you not think it is better that we own a home and pay the mortgage on it rather then pay it for someone else by renting (not to forget extortionate letting agency fees etc)?

Your numbers don't make sense to me.

If you've not been able to save enough to a decent deposit there is no way you're going to be able to afford to pay the 20% loan off in 5 years with all the additional costs of home ownership when the difference between rent and mortgage is only £15.

Otherwise, if you are really saving at that rate, just save for a few more years and do it on your own rather than getting saddled with a massive millstone from the government.

demontfort

namiku wrote: »

Impatience has nothing to do with it. Its simply too difficult to save up a big enough deposit for an affordable mortgage.

The cost of living together with the house prices have risen way over the wage increase in the past 20 years.

I'd like to know about your situation and how you managed to afford a home and also what do you think the money is better spent for, rather then helping the taxpayers while boosting the economy?

I have a good job and salary but have worked hard to get here, have saved all my life and invested my money in the stock market.

As the previous poster says I don't have issues with you personally, good luck getting a home and starting a family. Yes you are gettin a freebie and no it's not fair but if the money is there then take it.

I do have issues with stupidity of the government which has implemented this policy to lend a lot of cash to a small minority of taxpayers who the banks don't want to take a risk on. It may give a short term boost to the economy at the expense of further pushing up house prices for people like yourself, further increasing goverenment borrowing and increasing exposure of both the banks and people like yourself to the financial risk of a housing market downturn. Hmm I'm sure that happened somewhere before let me think.

As for other things to spend the money on, you should come and see my home city Coventry and I'll show you dozens of things the money could have been spent upon crumbling roads, dilapidated schools, closed down car factories, boarded up high streets and people scraping buy on minimum wage salaries.

Conrad

demontfort wrote: »

Why should the government waste money helping out people who are in a position to manage by themselves but too impatient to save up for a deposit. There are far more deserving cause than FTBs.

1. Millions of homes built in the early part of last century and onwards were council homes, agricultural tied cottages and so on. Housing subsidy is nothing new.
2. 95% mortgages have been around since the 1980's and me and millions like me managed perfectly well to sustain them.

namiku

somethingcorporate wrote: »

Your numbers don't make sense to me.

If you've not been able to save enough to a decent deposit there is no way you're going to be able to afford to pay the 20% loan off in 5 years with all the additional costs of home ownership when the difference between rent and mortgage is only £15.

Otherwise, if you are really saving at that rate, just save for a few more years and do it on your own rather than getting saddled with a massive millstone from the government.

We've not been able to save as we have been spending more money on enjoying our life while we are still young and we've also had to pay for putting ourselves through school without getting any student loans or grants of any sort.

We have also not been on the current income for more than 14 months, however in this time after paying all credit cards we have managed to save over £7000.

We estimated that we could save around £10000 a year give or take and really don't fancy waiting another 5 years to save up for a deposit when the house prices will be probably going up even further.

Why should we waste 45000 on rent when we could put that towards paying our mortgage?

namiku

demontfort wrote: »

I have a good job and salary but have worked hard to get here, have saved all my life and invested my money in the stock market.

As the previous poster says I don't have issues with you personally, good luck getting a home and starting a family. Yes you are gettin a freebie and no it's not fair but if the money is there then take it.

I do have issues with stupidity of the government which has implemented this policy to lend a lot of cash to a small minority of taxpayers who the banks don't want to take a risk on. It may give a short term boost to the economy at the expense of further pushing up house prices for people like yourself, further increasing goverenment borrowing and increasing exposure of both the banks and people like yourself to the financial risk of a housing market downturn. Hmm I'm sure that happened somewhere before let me think.

As for other things to spend the money on, you should come and see my home city Coventry and I'll show you dozens of things the money could have been spent upon crumbling roads, dilapidated schools, closed down car factories, boarded up high streets and people scraping buy on minimum wage salaries.

As for working hard both me and my wife were working for minimum wage no later than 3 years ago.

You should not see this government cash as a handout as it is far from it.

It is an investment that helps the industry, the people and can turn out to be very profitable if the house prices do indeed go up in the next 4-5 years. Also there is potential for a good return in this investment if the house prices go up considerably because 20% of any sale price will go to the government.

demontfort

Conrad wrote: »

1. Millions of homes built in the early part of last century and onwards were council homes, agricultural tied cottages and so on. Housing subsidy is nothing new.
2. 95% mortgages have been around since the 1980's and me and millions like me managed perfectly well to sustain them.

1. Millions of homes built in the early part of last century and onwards were council homes, agricultural tied cottages and so on. Housing subsidy is nothing new. Well use the money to build council houses instead, we definitely need them. This is different as you're using government money to help individuals buy and retain an asset rather than providing rented accomodation which the government retains.
2. 95% mortgages have been around since the 1980's and me and millions like me managed perfectly well to sustain them. If the banks are willing to take the risks, so be it but the government should not be underwriting the risk. If house prices fall, a 95% mortgage can quickly become a 100% plus mortgage combine that with job losses in this ongoing recession and you have a perfect storm of Nequity and repossessions.

brit1234

namiku wrote: »

Impatience has nothing to do with it. Its simply too difficult to save up a big enough deposit for an affordable mortgage.

If it is too difficult to save then how are you going to pay back the 20% equity loan after 5 years?

What happens if QE or funding for lending ends and interest rates go up?

The schemes are little more than a bung to the big builders who donate to both Labour and Tory parties. It is also designed to inflate already overvalued house prices.

Most of the people who take up these schemes are financially illiterate or reckless. Please tell me what is wrong with cutting back spending and saving a deposit. With Help to buy you pay a newbuild premium which vanishes after you buy wiping out a 5% deposit in most cases. You are in technical negative equity from the start which makes it far harder to remortgage or sell trapping yourself.



Help to buy is sub prime lending and your posts does nothing to diminish that fact.

jamesml

Why do you keep referring to it as a handout? Maybe I have a fundamental misunderstanding of the HTB scheme but I though the 20% contributed by government was just a loan, not a gifted amount. You still have to pay it back.

There is more of an opportunity cost than a real cost - its just timing, although I appreciate the cash could be used elsewhere in the short term.

leveller2911

namiku wrote: »

Also there is potential for a good return in this investment if the house prices go up considerably because 20% of any sale price will go to the government.

And there lies the problem. Can you explain why "house prices" rising helps Society/Government long term ?. Earnings will never compare with the cost of houses in the UK until we have a house price correction.It will be painful for some/many but until a Government grows a pair of balls and stop fudging the issue sooner or later they will run out of bullets and then have no options but to let the market fall.

As for a "potential" good return can you post a few examples of where the Government have recieved a "good return" from gambling taxpayers money.. I can't see many of the banks that were bailed out giving the taxpayers a good return on our investments anytime soon.

Your plan is nothing more than greed and a gamble. I will be alright Jack , f*ck the next generation.

The fact is that if the house prices keep rising with every year that passes house buying will be even further out of reach for the average person and the problem compounded.