Help to Buy creates surge in new homes

Graham_Devon

mayonnaise wrote: »

Nothing curious about it.

HTB gets people on the housing ladder at little or no cost (maybe even profit) to the taxpayer, social housing keeps people in long-term housing dependency at huge taxpayer expense.

A no-brainer really.

So seems you are against helping the genuninely needy, but all for helping someone who already has the fund to buy a house - get a better house than they could otherwise afford?

You are forever telling people to cut their cloth accordingly - but that goes out of the window when choosing a house (so long as they are buying)? And suddenly, those very people are worthy of state help in order that they can have a new shiny house over a 1940's terrace?

MARTYM8`

HappyMJ wrote: »

Help to Buy enables purchasers to buy a bigger house than they otherwise would have been able to afford.

Alternatively

Help to Buy enables purchasers to pay more for a house than they can actually afford!

The developers can of course charge 20 per cent more (or 40% per cent more now in London).

Maybe we could just cut out the middleman and have the taxpayer pay billions in dividends to their shareholders. Same outcome in the end - and much cheaper to administer.

So who is being helped - developers?

MARTYM8`

Graham_Devon wrote: »

So seems you are against helping the genuninely needy, but all for helping someone who has the funds get a better house than they could otherwise afford?

There are lots of genuinely needy people in this country.

Possibly for example the 200,000 frail elderly and disabled people who have lost access to local authority social care in England since 2010 due to cutbacks. Less taxpayer funds for that - but loads for this scheme?

People wanting to buy a bigger home than they can afford are certainly not top of my definition of 'genuinely needy'. Clearly we have different criteria.

Its the government's job to prioritise assistance to the poor, frail and vulnerable. Its not to subsidise anyone to buy an asset.

kinger101

What was the control group? A parallel universe where right-to-buy didn't operate.

There's some very dubious reasoning;

•Analysis of a representative sample of consumers who have bought with the
assistance of Help to Buy Equity Loan shows that 43% would not have been
able to afford the same or similar property in the new build or existing markets
without the scheme’s assistance;
• In interviews, all developers agreed that supply was demand-led so that sales
led to starts on at least a one-to-one basis – that is if a Help to Buy Equity
Loan sale is additional, there will be an additional new build unit. Therefore
43% is the central estimate of additionality

It should have questioned whether they have been able to by any property. If I can't afford steak, I might still buy a burger rather than go hungry. It doesn't change the about of beef consumed.

wymondham

MARTYM8` wrote: »

There are lots of genuinely needy people in this country.

Possibly for example the 200,000 frail elderly and disabled people who have lost access to local authority social care in England since 2010 due to cutbacks. Less taxpayer funds for that - but loads for this scheme?

People wanting to buy a bigger home than they can afford are certainly not top of my definition of 'genuinely needy'. Clearly we have different criteria.

Its the government's job to prioritise assistance to the poor, frail and vulnerable. Its not to subsidise anyone to buy an asset.

exactly...

Jon_B_2

MARTYM8` wrote: »

Alternatively

Help to Buy enables purchasers to pay more for a house than they can actually afford!

The developers can of course charge 20 per cent more (or 40% per cent more now in London).

Maybe we could just cut out the middleman and have the taxpayer pay billions in dividends to their shareholders. Same outcome in the end - and much cheaper to administer.

So who is being helped - developers?

What about the people who actually use HTB?

The government in 90% of cases will actually make a net profit out of HTB - so is actually an investment on their behalf.

What would I be doing now if HTB wasn't here? I'd still be renting trying to scrabble together a 10% deposit. Consequently not as many houses would be getting built, so house prices would still be out of reach.

People seem to be under the illusion that HTB is a subsidy. It is not it is by definition a LOAN. Unless the HPC dream comes true it is a pretty safe bet.

FWIW, when I am paying over £1000/month to the tax man - it is nice to get some sort of payback occasionally.

Graham_Devon

Jon_B wrote: »

What would I be doing now if HTB wasn't here? I'd still be renting trying to scrabble together a 10% deposit. Consequently not as many houses would be getting built, so house prices would still be out of reach.

That doesn't appear to be the case.

The report specifically cites all the dangers of coming to this conclusion.

Theres nothing to compare against. What I mean by that is that should HTB not have taken place, how do we know a certain house wouldn't have been built? We don't and never will. All we do know is that you cannot buy off plan with HTB and therefore the house needs to be built before someone can use HTB to buy it.

So by all measures, it would appear the house would have been built regardless of whether HTB was in place, as has always been the case. It might just have been sold at a lower price.

The best that the report can come up with is that builders have more confidence to build houses due to HTB. However, they are building less of them (in total). Profits of the builders since HTB was introduced was not questioned in the report, but look at any results and the linkage in the surge in profits since HTB is clear.

wotsthat

Graham_Devon wrote: »

So seems you are against helping the genuninely needy, but all for helping someone who already has the fund to buy a house - get a better house than they could otherwise afford?

You are forever telling people to cut their cloth accordingly - but that goes out of the window when choosing a house (so long as they are buying)? And suddenly, those very people are worthy of state help in order that they can have a new shiny house over a 1940's terrace?

Bit of a straw man. No-one is against helping the genuinely needy - we have different ideas of what genuinely needy means that's all.

Everyone who buys a new home via HTB is adding to supply and is no longer having to rent. That sounds like a win win. There are better ways to increase supply with less taxpayer risk I suppose but if the government want to meddle they could do worse things.

It's a non argument to say if you support HTB you must also support the building of council houses or other welfare dependency schemes.

Graham_Devon

wotsthat wrote: »

Bit of a straw man. No-one is against helping the genuinely needy - we have different ideas of what genuinely needy means that's all.

Everyone who buys a new home via HTB is adding to supply and is no longer having to rent. That sounds like a win win. There are better ways to increase supply with less taxpayer risk I suppose but if the government want to meddle they could do worse things.

It's a non argument to say if you support HTB you must also support the building of council houses or other welfare dependency schemes.

They are buying supply, not adding to it. Unless you can state categorically that for every HTB house bought, another is built in it's place.

That house will get bought regardless of whether the purchases uses HTB or not.

wotsthat

Graham_Devon wrote: »

They are buying supply, not adding to it. Unless you can state categorically that for every HTB house bought, another is built in it's place.

That house will get bought regardless of whether the purchases uses HTB or not.

I'm thinking of HTB for new houses which is obviously new supply.

The reasons for HTB on used houses are more tenuous but the majority of HTB houses are new.

I'm quite disappointed in the new supply levels so I would've thought anyone against it is pleased the impact has been so limited.

Should've relaxed planning and not reacted to the GFC by restricting mortgages. Would've led to more supply at, arguably, lower risk to the taxpayer.