House prices

ukcarper

GreatApe wrote: »

The majority of native born brits will inherit property or the sums to buy property it doesn't get any easier than that.

Some people find that a depressing though because they themselves wont (or think they wont) get any inherited/gifted wealth. But people should not think like that, the only alternative is developing countries which are yet to build out their infrastructure and hence much lessor amounts of wealth are passed down the generations simply as much less wealth exists.

Things are not bad for most the people of the UK they are good.
Wages savings housing is all in a fairly good state the biggest problems we face in this country are dysfunctional individuals and families not housing not 'austerity' etc.

Although my children will inherit my house they could easily be in thier 50s when they do so it doesn't help thier present housing needs.

lisyloo

ukcarper wrote: »

Although my children will inherit my house they could easily be in thier 50s when they do so it doesn't help thier present housing needs.

Me too. We have parents of nearly 90 and may we’ll be retired before they die. It might be spent on nursing home fees as well.

Not everyone lives until 90, but not many die when offspring are wanting to get a home in their 20s.

Personally I’d rather they spent it on themselves but once you reach the point of struggling to get out of a chair then there isn’t a lot to spend it on.

GreatApe

ukcarper wrote: »

Although my children will inherit my house they could easily be in thier 50s when they do so it doesn't help thier present housing needs.

They have two sets of grand parents and 2 sets of grand-parent-in-laws so they could get sooner than you think plus there is possibly marriage into a richer family. Now I am not saying these are aims or how one should plan their life, but I am saying it is what will happen to the majority

GreatApe

ukcarper wrote: »

Although my children will inherit my house they could easily be in thier 50s when they do so it doesn't help thier present housing needs.

It helps them a great deal
If they get when they are say 55 it gives them a huge capital boost.
They can either pass it on directly to their own kids who would be about 20-35 at that point
Or they can keep it and get a big boost to their earnings/pension

Pensions is another way the young will benefit from their parents. All this talk of the young being screwed in pensions is silly. I know a former steel worker who got over £500k pension in his final salary pot which he transferred into a SIPP. Now many the young will cry they are not gong to have such great pensions....but they are going to inherit it they dont even need to work for it. In the case of the person I mentioned they probably wont draw on that pension at all they have other income. That means the kids will get that pension and possibly totally tax free

While you may think this is a very rare example, that stats shows that for estates about half the wealth is property the other half non property (things like pensions). So not only are the kids getting the house, the are also getting the same again in pensions and cash bank accounts etc

The amount of wealth transferred from the old to the young is immense its almost hard to fathom. By my reckoning its something on the order of £200 billion annually that is equal to about 1 million homes fully paid off given from old to young for free

The lefties then cry well that £200 billion must be £190 billion to a few rich people and £10 billion to everyone else. Well there too they are wrong the biggest stock of wealth in the uk is houses and they are very evenly spread out. Of the old natives they are about 80% owners that shows the wealth is very widely spread

There is also a lot of wealth that is not priced correctly. For instance if I open a small business that makes say £50k profit a year and its almost fully self running and is a very stable long term sector. Well its shares are 'worthless' as they are not on any exchange however that £50k income actually has a net present value of something like £1 million. If someone owns the same dividend paying shares in a FTSE company it would have a valuation of >£1 million. This is one of the reasons why the poor look poorer than they actually are and the rich look richer than they actually are. A lot of the people in the middle have wealth which is not accounted for correctly.

The majority really do have it very good in this country
The lefties very successfully paint a negative picture and get a lot of air time but the reality is we are a rich nation and the majority of people in the UK have good lives and lots of opportunity and most the young will inherit wealth unthinkable a generation or two ago.

ukcarper

GreatApe wrote: »

They have two sets of grand parents and 2 sets of grand-parent-in-laws so they could get sooner than you think plus there is possibly marriage into a richer family. Now I am not saying these are aims or how one should plan their life, but I am saying it is what will happen to the majority

GreatApe wrote: »

It helps them a great deal
If they get when they are say 55 it gives them a huge capital boost.
They can either pass it on directly to their own kids who would be about 20-35 at that point
Or they can keep it and get a big boost to their earnings/pension

Pensions is another way the young will benefit from their parents. All this talk of the young being screwed in pensions is silly. I know a former steel worker who got over £500k pension in his final salary pot which he transferred into a SIPP. Now many the young will cry they are not gong to have such great pensions....but they are going to inherit it they dont even need to work for it. In the case of the person I mentioned they probably wont draw on that pension at all they have other income. That means the kids will get that pension and possibly totally tax free

While you may think this is a very rare example, that stats shows that for estates about half the wealth is property the other half non property (things like pensions). So not only are the kids getting the house, the are also getting the same again in pensions and cash bank accounts etc

The amount of wealth transferred from the old to the young is immense its almost hard to fathom. By my reckoning its something on the order of £200 billion annually that is equal to about 1 million homes fully paid off given from old to young for free

The lefties then cry well that £200 billion must be £190 billion to a few rich people and £10 billion to everyone else. Well there too they are wrong the biggest stock of wealth in the uk is houses and they are very evenly spread out. Of the old natives they are about 80% owners that shows the wealth is very widely spread

There is also a lot of wealth that is not priced correctly. For instance if I open a small business that makes say £50k profit a year and its almost fully self running and is a very stable long term sector. Well its shares are 'worthless' as they are not on any exchange however that £50k income actually has a net present value of something like £1 million. If someone owns the same dividend paying shares in a FTSE company it would have a valuation of >£1 million. This is one of the reasons why the poor look poorer than they actually are and the rich look richer than they actually are. A lot of the people in the middle have wealth which is not accounted for correctly.

The majority really do have it very good in this country
The lefties very successfully paint a negative picture and get a lot of air time but the reality is we are a rich nation and the majority of people in the UK have good lives and lots of opportunity and most the young will inherit wealth unthinkable a generation or two ago.

This thread is about housing and I'm not disputing that many people will benefit from a inheritance but no all by a long way. But it doesn't help young people now with the cost of housing.

As or my children they have no property owning grandparents and it is not unusual for people of thier age in 1950 75% of people rented.

As for pension pots most die with pensioner or thier spouse.

GreatApe

ukcarper wrote: »

This thread is about housing and I'm not disputing that many people will benefit from a inheritance but no all by a long way. But it doesn't help young people now with the cost of housing.

As or my children they have no property owning grandparents and it is not unusual for people of thier age in 1950 75% of people rented.

As for pension pots most die with pensioner or thier spouse.

And on the other side of the spectrum almost everyone I know who has married, mostly people in their late 20s early 30s have gotten cert significant early Inheritances (aka gifts) in one case the couple were gifted a while house probably worth half a million.

Anyway its best to look at the data and it shows over £73 billion left in estates (this excludes spouse to spouse transfers) and that is a bit out if date. Half this £73 billion were homes the other half mostly pensions and cash. The data is a few years old and is likely to be closer to £100 billion annually now. And that only includes Inheritences bit gifts which my guess is about the same size. So overall there is a transfer of some £200 billion annually from old to young.

I accept that if life expectancy is age 82 then most of the people getting the inheritances are in their 50s.

Also as I have pointed out before we need about 14% private rental and we are at 19% so any housing problems we have are found in the difference between the two. That means a max of 5% of households are renting who might otherwise in a perfect world be owners. But even that is a bad model because we know a lot of this 5% are recent migrants and divorced people and even ex-owners and even people who rent but also own property and also many rentals (about 500,000 iirc) are renters who pay no rent or very little rent they rent off family and these people are often old frail parents or disabled kin and I am not convinced someone living in a house rent free is a renters the usual meaning. That means any housing problems we have a well below the 5% difference between the min needed 14% rentals and the 19% we have.

So the market and systems are working. Housing isn't a problem.

GreatApe

ukcarper wrote: »

This thread is about housing and I'm not disputing that many people will benefit from a inheritance but no all by a long way. But it doesn't help young people now with the cost of housing.

As or my children they have no property owning grandparents and it is not unusual for people of thier age in 1950 75% of people rented.

As for pension pots most die with pensioner or thier spouse.

Final salary and annuities might die with the owner but the rest don't and even most final salary pots can be transfered before retirement. Anyway its a significant part of wealth transfered down I can't be bothered to check again but its probably in the region if £25 billion annually bit a sum to be ignored or trivialised

As noted before private renting is a transitional tenure the vast majority of the 19% of private renters will move on from private rentals within a few short years. Probably 14% of that 19% are short term renters (0-9 years)

14/19 = 74% of renters are short term renters

Even the remaining 26% are not helpless poor most the remaining 26% of renters are recent migrants or divorced people or even people who will be owners but need to rent more than 9 years before they are able to buy or even people who own in one part of the country but rent in another. Also a large number of the 19% that rent 2% point of that are renters living rent free or for a small sum. I am not sure buying a house near you to put your old frail mother in it rent free should count as a 'rental'. It even works the other way with parents buying houses and renting it for zero rent to their partially disabled children to give them some independence.

So overall there is no real housing crisis in the UK. Those who can afford to buy buy. Those who can't get given social homes. And 19% rent privately but the vast majority do so temporarily or get free or very low fee rentals.

Senseicads

GreatApe wrote: »

So overall there is no real housing crisis in the UK. Those who can afford to buy buy. Those who can't get given social homes. And 19% rent privately but the vast majority do so temporarily or get free or very low fee rentals.

Are you kidding? renting temporarily? I assume that this doesn't apply to the south east then?

GreatApe

That is one part that the hpc miss completely and I suspect most the government too
About 500,000 landlords are only 'landlords' because they bought a house to put a relative in it rent free
Often frail parents or disabled children.

GreatApe

Senseicads wrote: »

Are you kidding? renting temporarily? I assume that this doesn't apply to the south east then?

I dont have a regional breakdown but nationally its roughly 75% of private renters will buy in less than 10 years of renting. In my case i rented for 9 years before buying

It is a transitional Tenure