Exploitation, Exploitation, Exploitation

westernpromise

Jason74 wrote: »

To be fair, I think that they probably do realise that. What I suspect they are doing, is highlighting the problems caused on the supply side, with a hope that something will be done about it.

Yebbut the people most vociferous about high house prices tend to be would-be buyers. House prices are high because there are lots of would-be buyers. Hence the unaffordability of homes to buyers is the fault of home buyers.

This is not a palatable message, of course. Especially at the Grauniad they're going to need their housing problem to be somebody else's fault, and they're always going to need the solution to be higher taxes (on other people).

Generali

westernpromise wrote: »

Yebbut the people most vociferous about high house prices tend to be would-be buyers. House prices are high because there are lots of would-be buyers. Hence the unaffordability of homes to FTBs is the fault of home buyers.

This is not a palatable message, of course. Especially at the Grauniad they're going to need it their housing problem to be somebody else's fault, and they're always going to need the solution to be higher taxes (on other people).

Demand is created by people willing and able to pay a price not by the number of people that want something.

Demand for Ferraris is low not high. The reason? Loads of people want Ferraris but very few can afford them.

CLAPTON

Generali wrote: »

Demand is created by people willing and able to pay a price not by the number of people that want something.

Demand for Ferraris is low not high. The reason? Loads of people want Ferraris but very few can afford them.

good that you have now realised that demand is an important factor in determining price : the next step is to examine the factors affecting demand

westernpromise

Generali wrote: »

Demand is created by people willing and able to pay a price not by the number of people that want something.

A distinction without a difference. If you want a house and bid £100k, and somebody else wants it and bids £101k, the fact that its price has gone up £1k is not the fault of the seller. It's your fault for bidding it up to £100k, and the rival bidder's fault for going to £101k.

CLAPTON

westernpromise wrote: »

A distinction without a difference. If you want a house and bid £100k, and somebody else wants it and bids £101k, the fact that its price has gone up £1k is not the fault of the seller. It's your fault for bidding it up to £100k, and the rival bidder's fault for going to £101k.

I'm not sure 'fault' is the appropriate word, it is simply a consequence of the interplay of supply and demand or of buyers and sellers.

kabayiri

Speaking of exploitation, a tenuous segway here ...

In this weeks Dispatches they looked at a growing trend.

Take a terrace and turn it into 5 self contained flats.

And by flats, this was stretching it in the extreme. One guy's living room was about 4 feet wide!

Space wise there probably was no difference between a flat like this and a room/bedsit.

So, why do it?

The answer lies in housing benefit subsidy !

A room in a HMO attracts £98 per week HB income.
A flat like the above can attract £260 per week.

Of course, the tenants complain of cramped conditions, but is this more of an implementation issue?

Turning one living unit into 5 living units is actually providing more rentable accommodation for the poor income bracket in our Capital city.

cells

CLAPTON wrote: »

Presumably you are referring to the fact that high house prices caused by high immigration is a huge benefit to older people and a crippling burden to the young.
Personally, I view drop in asset prices is a price well worth paying for a large improvement in the living standards of the majority especially the young.
Better housing standards, shorter time servicing work, prospect of real increase in pay etc.....

sounds fantastic but but when the £3 trillion that is wiped off the value of homes results in a more than halving in stamp duty which tax will you put up council tax or income tax?

And when that £3 trillion vanishes and inheritance and capital gains tax crashes which taxes will you put up to cover that? fuel duty and add vat to all food?

And when that £3 trillion vanishes and the old that relied on it to pay for old age, to downsize and use the equity for their retirement. or for the house to be sold to pay for the care homes. Which tax will you put up to pay for that?


even rainbows cost money Clapton

Generali

westernpromise wrote: »

A distinction without a difference. If you want a house and bid £100k, and somebody else wants it and bids £101k, the fact that its price has gone up £1k is not the fault of the seller. It's your fault for bidding it up to £100k, and the rival bidder's fault for going to £101k.

The over bidder sets the price not the under bidder.

HornetSaver

cells wrote: »

What would happen to my terrace house in stoke I bought for £40k would I have to pay someone to take the liability off me once the immigrants who support the £40k prices disappear?

Novel idea: you could try living in it.

CLAPTON

cells wrote: »

sounds fantastic but but when the £3 trillion that is wiped off the value of homes results in a more than halving in stamp duty which tax will you put up council tax or income tax?

And when that £3 trillion vanishes and inheritance and capital gains tax crashes which taxes will you put up to cover that? fuel duty and add vat to all food?

And when that £3 trillion vanishes and the old that relied on it to pay for old age, to downsize and use the equity for their retirement. or for the house to be sold to pay for the care homes. Which tax will you put up to pay for that?

even rainbows cost money Clapton

As every competent economist will tell you, the tax required is determined by the governments policies : the total required will not change because the price of houses falls.
We will substitute one tax for another : the total burden is unchanged although some people may be 'winners ' and some 'losers' just like for any taxes.

I find it difficult to understand why you belittle the reasonable desire of (mainly young) people to live in a family sized property or to increase their real pay or to have no increase in their travel time to work.

It was only a relatively short time ago that stamp duty raised virtually nothing and the sun still shone.