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arrears have increased by 340% following the housing benefit cuts
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bulccp05laer wrote: »perma prop bulls
:laugh: How's the silver investment going?This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0 -
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bulccp05laer wrote: »
The problem now is the caps on benefit mean these families have to move to cheaper areas. Are you seriously trying to tell me there are other working families ready to pay £4000 per week out of earnings to replace the low income families relying on £4000 per week housing benefit?
It certainly sounds like that is what you are trying to say.
How many families actually get anywhere near this outside London?
How many get over £25K across the country.
Daily Flail and Government propaganda.
Not to say that rents will not start flattening or reducing for some BTLs. I doubt it will affect the vast majority. Interest rate increases will have a bigger impact as they will not be easily absorbed by those reliant on LHA/HB and against high LTVs but this will only be a limited proportion of BTLs."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
IveSeenTheLight wrote: »
Hmmm, okay, breaking this down.
There are only approx 1.46 million BTL,
yet your saying 5 million households would be affected.
How does that compute?
A lot are under social housing (housing associations etc), where the same scenario applies in effect.
I was being lazy with the figures just to make the point really.
I don't believe you need absolute figures to understand the point being made here. We don't have to make this difficult. It's plainly obvious that giving people the ability to meet demand (housing benefits) allows rents to stay at a higher level than they would be if those on housing benefits lost the ability to pay the rental demanded.0 -
Houses are no different to any other product. Even social housing costs money to produce, the price charged needs to cover the costs of production, if you don't cover cost of production you go belly up.
Cost of production is pretty much the same in any country. Building materials are the same all around the world. Rents are significantly higher in the UK than the rest of Europe or the rest of the world.0 -
IveSeenTheLight wrote: »Mortgage owners were able to afford payments when prices and rents were higher.
For many there has been rent inflation in the last 5 years.
In that time, they've been able to benefit from lower interest payments allowing many to overpay their mortgages significantly reducing their amortization period.
For many, this economic recession has financially saved them tens of thousands.
No doubt near zero rates have helped many get through the last 5 years.
No doubt some have over paid their mortgage and are sitting pretty. Many more will have simply spent the money on paying down consumer debt and paying for the increased cost of living against a flat lining income.
When interest rates do go up there will those that can cope and there will be others stuck between a rock and hard place, their energy, fuel and food bills won't stop increasing apace.. Hopefully the latter can start racking up the consumer debt again to bridge the gap.
Hopefully interest rates will increase slowly for those with debt, I doubt we will see things go off a cliff just lower prices for a lot longer. Haven't previous reversions to higher interest rates been pretty aggressive though?
Whilst low rates may have saved many it is consigning many to lives of reduced income through poor annuities. Many more are suffering through no fault of their own through poor savings returns."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Cost of production is pretty much the same in any country. Building materials are the same all around the world. Rents are significantly higher in the UK than the rest of Europe or the rest of the world.
You forgot one other cost, land. Higher rents lead to higher land values, this is also a cost of production which needs paying for.0 -
So there seems to be a debate some think housing benefit going up so much of late has not pushed up rents and the property market in general and some think it has.
I would agree that is can not be specifically quantified how much housing benefit has pushed up rents. The only way to specifically quantify it would be to go back in time 10 years and stop housing benefit, then see if rents rose the same amount as they did the last decade.
How someone could make a case that they would have still gone up so much without the high housing benefit payments is laughable in my opinion. But that does indeed seem to be what Iveseenthelight is arguing.
The other way to specifically quantify it is to go forward in time another 10 years and see if indeed housing benefit does keep getting cut back regularly to see if rents stay up at these high levels after the cuts.
Seems October will be the next round when Universal Credit will cut back how much benefit many households get even more.
http://www.bbc.co.uk/news/uk-231223690 -
You forgot one other cost, land. Higher rents lead to higher land values, this is also a cost of production which needs paying for.
Yes and lower rents lead to lower land prices. Yes it needs paying for, if its not paid for prices go even lower as the smart money sells and gets out of the sector pushing property even lower.
There is no doubt that high housing benefits over the last decade pushed up rents and property values, there is in my opinion equally no doubt that when this stimulus as it were is cut back rents and property will fall.
This is the same cycle that has repeated for a long time now. The boom bust, property going from overvalued to undervalued.
In the 90's property was undervalued then it has gone to over valued. Property is now on its way to undervalued again, then the cycle will repeat and their will be another boom.
Why anyone thinks the cycle will end anytime soon is crazy. Some would say property will never be undervalued ever again. This is just as crazy.
The cycle will repeat that is certain, only thing uncertain is the timing.0 -
So there seems to be a debate some think housing benefit going up so much of late has not pushed up rents and the property market in general and some think it has.
I would agree that is can not be specifically quantified how much housing benefit has pushed up rents. The only way to specifically quantify it would be to go back in time 10 years and stop housing benefit, then see if rents rose the same amount as they did the last decade.
How someone could make a case that they would have still gone up so much without the high housing benefit payments is laughable in my opinion. But that does indeed seem to be what Iveseenthelight is arguing.
The other way to specifically quantify it is to go forward in time another 10 years and see if indeed housing benefit does keep getting cut back regularly to see if rents stay up at these high levels after the cuts.
Seems October will be the next round when Universal Credit will cut back how much benefit many households get even more.
http://www.bbc.co.uk/news/uk-23122369
Have LHA rates increased a lot recently.0
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