Osborne: Scrapping HTB would be "intergenerational theft"

Graham_Devon

A wall of text, full of made up and unwarranted assertions on "what I think" isn't going to change anything Hamish.

The only reason you fully support HTB is you know the price ofyour property assets are increasing due to the extra demand HTB funnels into the market.

The only reason you support more people entering our shores is you know it does the same thing, more demand pushes prices higher.....and helps pay your pension of course.

Lets not pretend it's about anything else. It's not. We both know that.

I want cheaper housing. I want fewer people. I don't pretend it's for any other reason then my own and my childrens gain. My gain though, is different from yours.

Even the builders themselves are having trouble disgusing their upward profits since HTB was announced as anything else.

HAMISH_MCTAVISH

Graham_Devon wrote: »

The only reason you fully support HTB is you know the price of your property assets are increasing due to the extra demand HTB funnels into the market.

HTB does not create extra total demand for housing Graham. It does enable more people to buy rather than rent however. And partially cures some of the disastrous effects of mortgage rationing which has forced Generation Rent to be stuck buying a house for their landlords rather than themselves.

Those people are in need of housing now, rents have soared to record highs now, house building fell to 100 year lows, and the dysfunctional lending you cheered on worsened the shortage.

And you think the solution is to continue those failed policies?

You really think the solution is to prevent millions from buying and ensure fewer houses are built?

Really?

The only reason you support more people entering our shores is you know it does the same thing, more demand pushes prices higher.....and helps pay your pension of course.

I support more people coming here because the economy and society are frankly stuffed if the demographic imbalance gets any worse.

We would all suffer from higher individual tax rates, crumbling infrastructure, cuts in services, reduced government revenue, a shrinking economy, etc, which are the inevitable results of there being too many pensioners and not enough workers in a society.

Lets not pretend it's about anything else. It's not. We both know that.

I want society to thrive and prosper long into the future. You want house prices to fall no matter what the cost to society.

Let's be clear that's what this is about.

I want cheaper housing. I want fewer people. I don't pretend it's for any other reason then my own and my childrens gain.

Exactly.

But you are too short sighted to see how disastrous it would be for you and your children, along with everyone else, if the policies you advocate were implemented.

Graham_Devon

OK Hamish.

Tell me, what policies do I advocate.... Exactly?

CLAPTON

Graham_Devon wrote: »

Even the builders themselves are having trouble disgusing their upward profits since HTB was announced as anything else.

during the period 2008-2013 most house builders made a loss.

there has clearly been a recovery both in the general economy (more jobs, less unemployment, increase production etc) as well in house building.

surely any normal rational person would both expect and welcome a return to profits in the house building sector.

HAMISH_MCTAVISH

Graham_Devon wrote: »

Tell me, what policies do I advocate.... Exactly?

Anything that reduces the number of people able to buy a house.

You think the problem is price, so you advocate artificial reductions in demand, because you think that will make prices fall.

What you don't see is that it just prevents people from buying, ie, what happened in late 2008 and early 2009. Only around 20k people a month able to buy instead of 100K plus a month in 2007.

Lower prices are no use if virtually nobody can buy a house Graham..... That doesn't help at all.

And lower prices are worse than no use when the artificial restrictions you want to use to get them causes house building to fall to 100 year lows. Worsening the housing shortage.

lukeh23

Another issue is poor utilisation of the countries housing stock.

Its more lucrative for the baby boomers to stay in their 4-5 bedroom house with its decent rise of value near double digits, then some isa that gives them 2%

Also add to the fact, politicians all own on average 2-3 houses with one paid for by us in prime london, then you can see why they won't step back and let the market correct itself.

CLAPTON

lukeh23 wrote: »

Another issue is poor utilisation of the countries housing stock.

Its more lucrative for the baby boomers to stay in their 4-5 bedroom house with its decent rise of value near double digits, then some isa that gives them 2%

Also add to the fact, politicians all own on average 2-3 houses with one paid for by us in prime london, then you can see why they won't step back and let the market correct itself.

in what way is it lucrative for people to stay in their 4-5 bed houses ?

the only beneficiaries will be the taxpayers (IHT) and their children/grandchildren gen X&Y and Z

Graham_Devon

HAMISH_MCTAVISH wrote: »

You think the problem is price, so you advocate artificial reductions in demand, because you think that will make prices fall.

What is an "artificial" reduction in demand?

How does that work? How do you artificially reduce demand?

thequant

As Hamish keeps pointing out, it is quite simply down to supply and demand.


Let's look at London, at a Macro-economic level.


On a few threads here, it is occasionally asked where will the proles live ? e.g. the bar people, the barristas, shelf stackers etc.


At the minimum wage @ 40 hours a week, the net take home pay a month is £989.


In reality, people will earn more than this as plenty of employers in London pay more than min wage for Mcjobs and there is always 2nd jobs and overtime. However this figure is the floor.


As is acknowledged these people are not in position to buy in London, however they need to live somewhere, where do they live ?


They live in bedsits, house shares, HMO's etc.


If you look in Londons outer boroughs, the cost of a room varies between £400-£600 a month, depending on whether it is a single/double, en-suite etc


This is more than achievable for someone in a McJob.


Now look on the impact on prices, if a bedroom in zone 5 can generate an income of say typically £500 a month.


A 3 bed house, £1500 a month.


Turn the living room into a bedroom, another £500 a month.


Loft and/or garage conversion, another £500 a month.


Now a typical 3 bed terrace in outer London can generate an income of £2500 a month.


Some of these properties can still be picked up for £250,000, which would cost a LL £833 a month on a IO mortgage at 4%


There is a demand, and that demand will be met by landlords increasing the supply by sub dividing their properties for increased yield.


It's not just the rich pushing up prices, but the proles who are pushing up the cost of a bedroom which has the knock on effect of pushing up the price of whole properties.


In Victorian times in London, whole properties were lived in by multiple families.


If you restrict supply, people don't go homeless, they just cram themselves into what's available which will push up the base price of even the lowest quality housing stock, thus pushing up the whole market up from the bottom.

Jack_Johnson_the_acorn

Graham_Devon wrote: »

What is an "artificial" reduction in demand?

How does that work? How do you artificially reduce demand?

Wow, is this you playing stupid, or am I giving you too much credit, I fear it's the latter.

Artificial as in the demand still exists but is subdued owing to mortgage rationing etc....