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Intervention ... my take on it all....
wymondham
Posts: 6,356 Forumite
Firstly I'm not claiming to be a finance whizz, so this is just my take on things as I see it - probably way too simplistic and without half the knowledge of most on here but hopefully some of it makes sense??!
Here goes:
In recent years there is a new trend of Government intervention. This has been in house purchase, car sales and probably other things I'm not aware of. I thought we lived in a capitalist society whereby the market dictates what works and what does not? This is very good at deciding if something is viable and should be successful and if something should go bang and close.
In years gone by you had the people who purchased their homes, and those that went into social housing and this worked well for both parties. The decision to sell off council houses and deplete the housing stock for social housing has muddied the waters. The Government still has it's social responsibility to house people, but now without the means to do it, hence why it's now entering the private sector and desperately trying to execute it's responsibilities in all manner of odd ways....
The schemes being put into place to sell houses are quite bizarre and confusing in their aims. Are they there to get as many people to buy as possible and hence reduce the social housing issue, or are they there to allow private companies to build/sell houses and employ people? It's not clear, especially since the limit on one of these schemes is an eye watering £600,000, so does not look very 'social' in it's aims!
Why now is Government peddling the right to buy a house so strongly? Many people can't afford to buy a house but that's now OK as the Government will make it so they can (or at least appear so!).
This is dangerous territory as the Government are now installing expectations and meddling in peoples private financial affairs. Why should the tax payer back someones private financial decision to purchase a house? Why are people now allowed to profit from house sales partly funded by the tax payer? Do they pay this profit back if they make a profit on their sale? Is this help to buy required to be on their tax return as payment in kind? (just a thought!)
Housing policy is broken. We need social housing how it used to be, where those that could not realistically buy their own home had a secure alternative to private renting. I'm not saying it was perfect (far from it!), but this constant meddling and tweaking without really helping people is storing up problems for the future. Surely building more true social housing would fulfil one of the Governments desires and that is supporting the house building industries with jobs etc?
I've said before lots of times that I feel the best thing to occur is nothing... absolutely nothing, no schemes, no 'helping hand', no preferencial treatment, no helping PRIVATE companies. Let the market find the true value of housing.
If builders can't produce houses that sell, then their business is not viable and they should go bust, just like any shop in the high street or manufacturer.
If banks are not prepared to lend or make lending too expensive, then why? They must feel it's not worth it or the amounts are too high or too risky? They are private businesses so should be able to make these decisions free from interference and based on market conditions. Banks know property is vastly overpriced and are not prepared to take on that risk without these schemes and Government 'help', so in effect are party to the silly price rises.
Yes, people who want to buy have been able to using schemes, but the longer term effects of these schemes are not known, with many of these people facing consequences in the future for their 'eased' and heavily manipulated entry to home ownership. You can bet that once problems start to occur in the future, the tax payer will be there once again to help out with more sticky plaster!
The Government have interfered for so long now and we're probably at the stage now whereby once the props are removed it will now cause chaos and hardship (bit like a necessary bush fire!) - something that is entirely necessary in a capitalist society but unexceptable to a Government facing re-election over the horizon!
It will take someone with balls to call a halt and actually start to sort the cause of the problem. Is George the man? it's not looking good with more of the same old, same old! Lots of can kicking!
And to discussion - how wrong am I? what have I missed or misunderstood with the current policy? Why is the current path the right way and why is state intervention absolutely needed in all these private companies to ensure Government housing policy works?
Here goes:
In recent years there is a new trend of Government intervention. This has been in house purchase, car sales and probably other things I'm not aware of. I thought we lived in a capitalist society whereby the market dictates what works and what does not? This is very good at deciding if something is viable and should be successful and if something should go bang and close.
In years gone by you had the people who purchased their homes, and those that went into social housing and this worked well for both parties. The decision to sell off council houses and deplete the housing stock for social housing has muddied the waters. The Government still has it's social responsibility to house people, but now without the means to do it, hence why it's now entering the private sector and desperately trying to execute it's responsibilities in all manner of odd ways....
The schemes being put into place to sell houses are quite bizarre and confusing in their aims. Are they there to get as many people to buy as possible and hence reduce the social housing issue, or are they there to allow private companies to build/sell houses and employ people? It's not clear, especially since the limit on one of these schemes is an eye watering £600,000, so does not look very 'social' in it's aims!
Why now is Government peddling the right to buy a house so strongly? Many people can't afford to buy a house but that's now OK as the Government will make it so they can (or at least appear so!).
This is dangerous territory as the Government are now installing expectations and meddling in peoples private financial affairs. Why should the tax payer back someones private financial decision to purchase a house? Why are people now allowed to profit from house sales partly funded by the tax payer? Do they pay this profit back if they make a profit on their sale? Is this help to buy required to be on their tax return as payment in kind? (just a thought!)
Housing policy is broken. We need social housing how it used to be, where those that could not realistically buy their own home had a secure alternative to private renting. I'm not saying it was perfect (far from it!), but this constant meddling and tweaking without really helping people is storing up problems for the future. Surely building more true social housing would fulfil one of the Governments desires and that is supporting the house building industries with jobs etc?
I've said before lots of times that I feel the best thing to occur is nothing... absolutely nothing, no schemes, no 'helping hand', no preferencial treatment, no helping PRIVATE companies. Let the market find the true value of housing.
If builders can't produce houses that sell, then their business is not viable and they should go bust, just like any shop in the high street or manufacturer.
If banks are not prepared to lend or make lending too expensive, then why? They must feel it's not worth it or the amounts are too high or too risky? They are private businesses so should be able to make these decisions free from interference and based on market conditions. Banks know property is vastly overpriced and are not prepared to take on that risk without these schemes and Government 'help', so in effect are party to the silly price rises.
Yes, people who want to buy have been able to using schemes, but the longer term effects of these schemes are not known, with many of these people facing consequences in the future for their 'eased' and heavily manipulated entry to home ownership. You can bet that once problems start to occur in the future, the tax payer will be there once again to help out with more sticky plaster!
The Government have interfered for so long now and we're probably at the stage now whereby once the props are removed it will now cause chaos and hardship (bit like a necessary bush fire!) - something that is entirely necessary in a capitalist society but unexceptable to a Government facing re-election over the horizon!
It will take someone with balls to call a halt and actually start to sort the cause of the problem. Is George the man? it's not looking good with more of the same old, same old! Lots of can kicking!
And to discussion - how wrong am I? what have I missed or misunderstood with the current policy? Why is the current path the right way and why is state intervention absolutely needed in all these private companies to ensure Government housing policy works?
0
Comments
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Thrugelmir wrote: »Look at where we were. How close to the cliff edge. Fixing the problems is going to take years. Only people themselves i.e. the next generation can make the cultural change.
but if people are continually offered a way of getting their first house most will go for it regardless?0 -
The trouble with economic policy is its geared towards vote winning. Its short term and timed around elections, there will be no long term stability if this continues, as soon as something starts to work, its changed
Party politics on a 4 year election cycle is no good for this country anymore, a one party view on how things should be run cuts out too many good points from other parties, there needs to be a new way of governing England, that draws from all parties policies0 -
Oh yeah, kind of forget we are governed by two parties
Not sure why I forgot that.........
Probably because the Tories played a blinder and saw that the liberals were so struck with the chance of being in government that they would swallow much worse than the most desperate of z listers in " I'm a Celebrity " They will never shout ..I'm a liberal let me out of here0 -
well, that's 24 hours gone without anyone really pulling me to shreds on this..... someone must disagree surely?0
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well, that's 24 hours gone without anyone really pulling me to shreds on this..... someone must disagree surely?
If it make s you happy - I disagree with you.
(not)"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 -
Tried reading it a couple of times and it sounded like the normal rant to me.
Agree need more social housing but that needs money up front and I can't see any of the parties providing that.0
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