The correction has been, gone, and is over

padington

westernpromise wrote: »

I have always been amused at claims that such-and-such a place - Manchester, Milton Keynes, Poland - would be great places for me to live in, should the company decide to relocate me there, because houses were so cheap.

Clearly, if houses are cheap, it's because nobody wants to live there.

There are examples of where people wanted to live there but they just didn't see sense in buying, like London after the war.

Rent controls meant no one wanted the responsibility of a building that earned little money.

Rich2808

cells wrote: »

the HPC crew were correct about the giant house price crash but it only happened in about half the country.

Prices in the north are about 15% lower in nominal terms than a decade ago and not far off 40% cheaper in real terms.

instead of taking some victory in being correct in half the country they actually ignore the 40% real term crash and cry prices are still far too high and they need another 50% crash before they think of buying[/QUOTE

Now you could obsess about the small number of people who post on house price crash. Or you could talk about what the consequences of having average house prices of £300k (£500k in London are). It means single people on typical wages have little chance of buying and couples struggle too - lets hope they don't have kids. And many are coming out of uni with debts running into the tens of thousands.

Now you can treat it as one big joke - but we have a serious problem here if larger and larger sections of the population rent possibly for ever. It means more and more resources go into housing at the expenses of the productive economy (i.e. businesses that make things) and eventually we will have to fund these people in retirements.

I do wonder if some on here sit like Mr Scrooge counting up how much the price of their one house has gone up this week - don't they have kids, grandkids nephews and nieces. I doubt most of them post on house price crash - but I expect they might like to see cheaper housing so they can build a future for their families.

And yes I am sure there are loads of places where you can buy houses cheaply - the sort of places where probably the most lucrative job locally is to aspire to be a deputy manager at the local Poundland.

cells

Rich2808 wrote: »

Now you could obsess about the small number of people who post on house price crash. Or you could talk about what the consequences of having average house prices of £300k (£500k in London are). It means single people on typical wages have little chance of buying and couples struggle too - lets hope they don't have kids. And many are coming out of uni with debts running into the tens of thousands.

Now you can treat it as one big joke - but we have a serious problem here if larger and larger sections of the population rent possibly for ever. It means more and more resources go into housing at the expenses of the productive economy (i.e. businesses that make things) and eventually we will have to fund these people in retirements.

I do wonder if some on here sit like Mr Scrooge counting up how much the price of their one house has gone up this week - don't they have kids, grandkids nephews and nieces. I doubt most of them post on house price crash - but I expect they might like to see cheaper housing so they can build a future for their families.

And yes I am sure there are loads of places where you can buy houses cheaply - the sort of places where probably the most lucrative job locally is to aspire to be a deputy manager at the local Poundland.

My post was not a joke or in jest.

Its a simple fact that about half the country is very affordable in fact ibwould go as far as to say half the country is cheap

The idea that those areas are only pound land shops is a joke the average wages across all the regions (exception is london) is similar. Half thebcoubtry isvat 2-4x income

As for how good or bad average house prices in London are £500k. I reckon that is a lot better than going the other way towards £50k

dktreesea

westernpromise wrote: »

I have always been amused at claims that such-and-such a place - Manchester, Milton Keynes, Poland - would be great places for me to live in, should the company decide to relocate me there, because houses were so cheap.

Clearly, if houses are cheap, it's because nobody wants to live there.

Over half the population in England don't live in the South East, the South West or London. That's quite a lot of people who would rather live where houses are cheaper and where they don't have to work half their week to pay their mortgage.

dktreesea

Rich2808 wrote: »

cells wrote: »

the HPC crew were correct about the giant house price crash but it only happened in about half the country.

Prices in the north are about 15% lower in nominal terms than a decade ago and not far off 40% cheaper in real terms.

instead of taking some victory in being correct in half the country they actually ignore the 40% real term crash and cry prices are still far too high and they need another 50% crash before they think of buying[/QUOTE

Now you could obsess about the small number of people who post on house price crash. Or you could talk about what the consequences of having average house prices of £300k (£500k in London are). It means single people on typical wages have little chance of buying and couples struggle too - lets hope they don't have kids. And many are coming out of uni with debts running into the tens of thousands.

Now you can treat it as one big joke - but we have a serious problem here if larger and larger sections of the population rent possibly for ever. It means more and more resources go into housing at the expenses of the productive economy (i.e. businesses that make things) and eventually we will have to fund these people in retirements.

I do wonder if some on here sit like Mr Scrooge counting up how much the price of their one house has gone up this week - don't they have kids, grandkids nephews and nieces. I doubt most of them post on house price crash - but I expect they might like to see cheaper housing so they can build a future for their families.

And yes I am sure there are loads of places where you can buy houses cheaply - the sort of places where probably the most lucrative job locally is to aspire to be a deputy manager at the local Poundland.

Yes, for sure, artificially (via the LHA) propping up the price of housing, especially the cheaper, poorer quality/location housing, is driving us towards a social welfare time bomb that will make the current cost of welfare look miniscule in comparison to what could be coming.


It's one thing to say that most of the working population don't claim any housing benefit, but if they can only afford to rent, and, with the death of final salary pensions, don't have much of a pension, maybe only the state pension, to support them once retired, who is going to pick up the shortfall for their rent going forward?



People won't save to buy a house if they think they will never be able to get on the housing ladder in the area they want to live, just because they don't earn enough. They may not be able to save much anyway if they are shelling out £800 a month in rent. Our rent, over the last ten years, is still reasonable, but it has risen faster than inflation and faster than our income. Plus, even if you save, you can get to a point, age wise, where all you can get is a 10 or 15 year mortgage. Or no mortgage at all - still working but "too old".


This isn't just going to be the nightmare of the poor, having to rely on housing benefit once they are over 65. What do we expect the elderly who have no house of their own to do - live in trailer parks?

allthingsmustpass

dktreesea wrote: »

Rich2808 wrote: »

This isn't just going to be the nightmare of the poor, having to rely on housing benefit once they are over 65. What do we expect the elderly who have no house of their own to do - live in trailer parks?

Indeed. This is what those here who cheer ever rising house prices are so happy about, just because they got in at an affordable time they like to lord it over those born at a less fortunate time than them.

Truly disgusting and vile people on this forum.

High house price cheerers ought to be thoroughly ashamed. Disgusting. Vile. Sick.

dktreesea

And for the record, house buyers are not in control of the value of their homes. There's no point blaming anyone who has bought a home for the failure of others to either save or earn sufficiently (or move to a cheaper area) to be able to afford a home.


A good example of uncontrollable events is the EU. Say we vote to leave. The pound will depreciate, if the panic about a Brexit on the Forex markets is anything to go by. The UK's credit rating could suffer, making it more expensive for them to borrow. To finance this, they may then have to raise interest rates, making mortgages more expensive. That could affect existing borrowers, especially those whose interest rates are linked to the base rate. A 3% mortqage interest rate doesn't look quire so good if it goes up to, say 4%. Not much? That's an extra £20 a week to the bank for every £100,000 outstanding on the mortgage, or thereabouts.

cells

dktreesea wrote: »

Yes, for sure, artificially (via the LHA) propping up the price of housing, especially the cheaper, poorer quality/location housing, is driving us towards a social welfare time bomb that will make the current cost of welfare look miniscule in comparison to what could be coming.


It's one thing to say that most of the working population don't claim any housing benefit, but if they can only afford to rent, and, with the death of final salary pensions, don't have much of a pension, maybe only the state pension, to support them once retired, who is going to pick up the shortfall for their rent going forward?



People won't save to buy a house if they think they will never be able to get on the housing ladder in the area they want to live, just because they don't earn enough. They may not be able to save much anyway if they are shelling out £800 a month in rent. Our rent, over the last ten years, is still reasonable, but it has risen faster than inflation and faster than our income. Plus, even if you save, you can get to a point, age wise, where all you can get is a 10 or 15 year mortgage. Or no mortgage at all - still working but "too old".


This isn't just going to be the nightmare of the poor, having to rely on housing benefit once they are over 65. What do we expect the elderly who have no house of their own to do - live in trailer parks?

Well some thoughts

Most the population need subsidizing for most things. A big one is heahcare but pretty much everything is subsidised for the average Jo. That is to say for most people they take more benefits and services from the state than they give back. should housing be any different?

Accounting tricks. The state is probably not doing too bad if a pensioner in the north or Midlands ends up renting. The rent of £500 a month is taxed at 40-45% income tax so the state is only really paying £275-300 a month. Also there will likely be a capital gains bill at some point when the landlord sells making it cheaper still. If you take that into account then the house is chepaer than a new build council house. So its cheaper for the state to put the pensioner in a private rental paying tax rather than a council or HA paying no tax.

Of course it would be a problem for pensioners to rent in London but why should they need to or the state have to subsidise a pensioner to live within walking distance of the square mile? They can be moved further out where the rent is much cheaper.

Overall I think most people would be happy to see more owners but that is going to require easier mortgages with less age restriction and higher build rates. That hopefully will happen in time but even if it does not its not going to bankrupt the state or see hordes or pensioners on the streets.

padington

dktreesea wrote: »

And for the record, house buyers are not in control of the value of their homes. There's no point blaming anyone who has bought a home for the failure of others to either save or earn sufficiently (or move to a cheaper area) to be able to afford a home.


A good example of uncontrollable events is the EU. Say we vote to leave. The pound will depreciate, if the panic about a Brexit on the Forex markets is anything to go by. The UK's credit rating could suffer, making it more expensive for them to borrow. To finance this, they may then have to raise interest rates, making mortgages more expensive. That could affect existing borrowers, especially those whose interest rates are linked to the base rate. A 3% mortqage interest rate doesn't look quire so good if it goes up to, say 4%. Not much? That's an extra £20 a week to the bank for every £100,000 outstanding on the mortgage, or thereabouts.

http://www.marketoracle.co.uk/Article54157.html

mwpt

cells wrote: »

Overall I think most people would be happy to see more owners but that is going to require easier mortgages with less age restriction and higher build rates. That hopefully will happen in time but even if it does not its not going to bankrupt the state or see hordes or pensioners on the streets.

We have easy mortgages with cheapest credit in history and longest terms. We have fewer owners than previously. Your theory is short termist and flawed.

We do need higher build rates but the private sector fails at that.