Has Crashy and co finally come to their senses...

chucknorris

cells wrote: »

If you look up your area LHA details there is a section that lists the proportion of each stock.
https://lha-direct.voa.gov.uk/search.aspx

So for inner east London (parts of hackney and tower hamlets) it has

161,209 properties
83,520 socially rented (blooming hell that's more than 50%!)
25,674 private rented (16%)
49,222 owned (31%)

It also shows the number of detached semi terrace flats etc for the area

There is however a problem in the data in that a lot of it is from 2011 and the private rental market has grown a lot in the last 5 years but it's interesting nonetheless

I think ONS has more up to date estimates

Thanks, I was interested in the percentage of privately rented, of the total privately owned and rented housing, in the 3 areas that we own those percentages are:

Hackney 34% (3 properties)
Wandsworth 30% (4 properties)
Haringey 35% (1 property)

Generali

cells wrote: »

Many thanks for the ibfi and historical context.

I would however add one point I almost never see mentioned. That of gifts an inheritances. House prices are indeed higher today but so are the sums received by gifts and inheritances. Looking at just one side of a personal balance sheet (price of house up) without factoring in the other side (gifts and inheritances up) would be ignoring a huge chunk of the market and sustainability of the market.

The UK has a lot more wealth today than it did 30-40 years ago. I estimate some £200 billion annually are left as gifts and inheritances and a lot of that finds its way into property especially London property.


So the average man on the average full and part time wage nay indeed not be able to buy in London but the median full time working man with an equivlabt wife/partner both of who get £100k inheritances they have no trouble buying and drive the market forward. Some people nay see this as unfair but forget the judgement of inheritances being good or bad they exist and they bid in the market

If your theory is right, wouldn't that mean that if asset (house) prices start to fall, the amount of the fall would be magnified by the reduction in equity finding its way back into the market via inheritance?

TBH I'm inclined to think that inheritance doesn't make a difference to house prices at all as an inheritance can only be realised by a sale, which would withdraw an equal and opposite amount of money from the market (assume no IHT), or a mortgage, which would show up in the MEW figures.

ETA: Just realised my mistake with my second para, an inheritance can be leveraged up as you can use it as a deposit and borrow against it. Duh.

economic

Generali wrote: »

If your theory is right, wouldn't that mean that if asset (house) prices start to fall, the amount of the fall would be magnified by the reduction in equity finding its way back into the market via inheritance?

TBH I'm inclined to think that inheritance doesn't make a difference to house prices at all as an inheritance can only be realised by a sale, which would withdraw an equal and opposite amount of money from the market (assume no IHT), or a mortgage, which would show up in the MEW figures.

ETA: Just realised my mistake with my second para, an inheritance can be leveraged up as you can use it as a deposit and borrow against it. Duh.

lot of gifts and inheritances wouldnt require a sale of a property, it would be passed down as cash or investments tht are then liquidated. the baby boomer generation has a lot of non property assets.

PixelPound

Crashy_Time wrote: »

Awww....no responses to the nice headline? :rotfl:

You forgot https://www.theguardian.com/money/2016/jun/10/buy-to-let-landlords-likely-to-increase-rents-to-offset-higher-costs so those that are still BTL are passing on costs, meaning less rentals coming on the market and those that do will have higher rents. Glad I bought last year :rotfl:

economic

nic_c wrote: »

You forgot https://www.theguardian.com/money/2016/jun/10/buy-to-let-landlords-likely-to-increase-rents-to-offset-higher-costs so those that are still BTL are passing on costs, meaning less rentals coming on the market and those that do will have higher rents. Glad I bought last year :rotfl:

hahha. when you buy it feels you are not only making capital gains but also money from imputed rent. which is rising. plus its money free of tax whereas renters pay rent post tax.

PixelPound

economic wrote: »

hahha. when you buy it feels you are not only making capital gains but also money from imputed rent. which is rising. plus its money free of tax whereas renters pay rent post tax.

We had outgrown our 1 bed flat, and the rent costs of private two bed houses were a steep increase, which was quite shocking considering some of them were hovels. Even though we are both in our late 40's, we are paying a mortgage on a 2-bed semi that costs less than the rent on our 1-bed flat did. We could have got a mortgage on a house twice the cost, but why mortgage yourself up to the hilt and not have money/time to enjoy life?

Generali

economic wrote: »

lot of gifts and inheritances wouldnt require a sale of a property, it would be passed down as cash or investments tht are then liquidated. the baby boomer generation has a lot of non property assets.

And at the same time we wouldn't expect all inheritances to be cycled into property. Plenty will be either retained as non-property assets or spent on consumption.

Not forgetting that much wealth doesn't pass down to the next generation most especially most pension assets but also larger estates may attract IHT.

It's not simply that total wealth is £x, one million people die each year thus £x / 1,000,000 is going to get cycled into property each year.

cells

Generali wrote: »

If your theory is right, wouldn't that mean that if asset (house) prices start to fall, the amount of the fall would be magnified by the reduction in equity finding its way back into the market via inheritance?

TBH I'm inclined to think that inheritance doesn't make a difference to house prices at all as an inheritance can only be realised by a sale, which would withdraw an equal and opposite amount of money from the market (assume no IHT), or a mortgage, which would show up in the MEW figures.

ETA: Just realised my mistake with my second para, an inheritance can be leveraged up as you can use it as a deposit and borrow against it. Duh.

Inheritances aren't derived just from homes. There is commercial property. Land. Stocks and shares. Pensions. And of course some people keep large amounts of cash in ISAs or other accounts. Oh and life insurance payouts too.

And yes you can leverage up too via a mortgage. So it might be a 20 something getting £30k from grandma and using his £15k wage can borrow another £60k which gives him a budget of £90k taking his buying power towards the average price in the north east

Or on the other side of the scale you might have a 30 something who works for the NHS always conplainig prices are too high but receives multiple millions from his father's estate (someone I know) who goes out and buys a big house cash in central London.

Without a doubt inheritances play a part in the hosuong market. Ignoring them is silly and its why the idea of a £26k 'avverage' wage buying the average property is wrong because the average is closer to a couple working full time and getting some gifts and inheritances along the way.

Crashy_Time

nic_c wrote: »

You forgot https://www.theguardian.com/money/2016/jun/10/buy-to-let-landlords-likely-to-increase-rents-to-offset-higher-costs so those that are still BTL are passing on costs, meaning less rentals coming on the market and those that do will have higher rents. Glad I bought last year :rotfl:

https://www.lettingagenttoday.co.uk/breaking-news/2016/6/rents-begin-to-fall-as-glut-of-homes-to-let-go-on-the-market


See if you are still glad when prices start to fall as well :rotfl:

cells

Generali wrote: »

And at the same time we wouldn't expect all inheritances to be cycled into property. Plenty will be either retained as non-property assets or spent on consumption.

Not forgetting that much wealth doesn't pass down to the next generation most especially most pension assets but also larger estates may attract IHT.

It's not simply that total wealth is £x, one million people die each year thus £x / 1,000,000 is going to get cycled into property each year.

A lot of it does go into property. Plus I reckon there must be an equivalent maybe even higher sum given as gifts to either avoid IHT or just simply parents want to help their children out. For instance I know one man that sold his business as he wanted to retire soon and bought for his son a house outright in London as a wedding gift.

Plus I reckon more inheritances are put towards property now than say a decade or two ago. Even when you read about people who have won the lottery you tend to read that they buy an expensive property to live in and perhaps some to rent out too. You never read of someone winning £10 million and putting it into a FTSE tracker or government bonds or a diversified allocation of assets national and international.