Use 'student loans' to fix the housing problem?

Windofchange

GreatApe wrote: »

You are a genius. How could I have been so wrong. You are right expanding universities add no demand to local housing everyone just commutes from their marital home and they don't spend a penny while they are there and no additional teaching or administration staff are added when universities expand. And they are not expanding anyway its all just done on the internet. The campus at Stratford they are building is probably to house the computers to serve their 30,000 over the internet students.

You will be a great success in life windy I can feel it in my bones.

You see, again, you completely miss the point. You stated:

GreatApe wrote: »

University college London is a good example of what is happening in inner London.
They were ~19,000 student in 2007 now they are 39,000 students in 2017.
That means double the demand for housing from just that one university.

Double the demand for housing you concluded. As per that post, you have not done any digging with the numbers, just simply presented it. This is the issue. Tell you what, find me the part where I have said that housing demand won't go up at all? You can't can you? So you then go on to get on your high horse about how clever you are etc etc, but have failed to grasp the underlying point of what I am saying - i.e. that housing demand has not doubled as you have gleefully stated.


I don't know how much more simply I can put this for you - you have obviously not had to develop any critical thinking skills in whatever you do. Let's spell it out and see if you can understand:


Great Ape - student numbers have gone from 19,000 to 39,000 therefore housing demand has doubled
Me - Yeah but not everyone who is a student at UCL needs housing, so housing demand hasn't doubled.
Great Ape - I don't understand, blah blah blah, you're an idiot, blah blah blah.
Me - See above.


Does this help? I'll come to the immigrants in part 2 with an equally simplistic explanation for you. Trying to have a sarcastic dig about success is water off a ducks back I'm afraid - I'm very happy.

Windofchange

GreatApe wrote: »

I have already explained this but you have conveniently forgotten about it

Housing is clearly affordable or even cheap in much of the country because the reinstatement value of houses in those areas is not far off the actual sale prices do you know what that means if you do know what that means then explain how you can consider housing expensive when the reinstatement cost is similar to the sale prices

Secondly as I have already mentioned multiple times to you in much of the country a repayment mortgage cost not much more than renting the local Social stock how can housing be in a bubble or so grossly over priced when a repayment mortgage is as cheap as the local Social stock?

While you sit there and sulk recent migrants have become homeowners at the rate of 50% longer term migrants have ownership rates of closer to 70% housing is clearly affordable despite your protests and crying

Going by your performance on these debates it seems that UCL has indeed had to reduce its quality to increase it's quantity

Where have I sulked about immigrants being able to buy a house / flat? Where have I bemoaned the fact that immigrants or anyone else for that matter can afford housing? Find me a post that I have made saying damn all these pesky immigrants, I wish they would just go away? As per the above, you can't can you?


You yet again are unable to extrapolate the argument that is being presented. This has all stemmed from you sarcastically replying to another forum member that because 47.9% of immigrants can buy a house, that means that it is affordable. You can throw around whatever jargon you want, but I'm not making a comment on the numbers of immigrants affording housing. As per the above, let's break it down for you:


Great Ape - 47.9% of immigrants who have come here with nothing but the clothes on their back can buy a house within 5 years. That proves how cheap housing is.
Me - Here is a report showing that actually immigrants earn pretty much comparable amounts of money to the indigenous population of the UK.
Great Ape - I've already explained how I am right, re-instatement value of houses, blah blah blah, you're stupid.
Me - Immigrants can mean all sorts of people from investment bankers to footballers to beggars. How does saying that 47.9% of them buying houses support your statement that housing is cheap.
Great Ape - I don't care what jobs they have, they are getting on with life and I'm right
Me - Well, it kind of does matter what jobs they have in light of your argument
great Ape - I've already proven I'm right, you're stupid.


As per the previous post, your comments about UCL are water off a ducks back - you unfortunately can't argue with stupid. I hope the above is simple enough, not that you will get it of course.


Do please get back to me with examples of posts that I have made which show that I am sulking about immigrants buying houses, or where I have stated there will be no increase in housing demand from increased numbers of students at UCL.

GreatApe

Windofchange wrote: »

You see, again, you completely miss the point. You stated:

Double the demand for housing you concluded. As per that post, you have not done any digging with the numbers, just simply presented it. This is the issue. Tell you what, find me the part where I have said that housing demand won't go up at all? You can't can you? So you then go on to get on your high horse about how clever you are etc etc, but have failed to grasp the underlying point of what I am saying - i.e. that housing demand has not doubled as you have gleefully stated.

You are a numpty the best you can do is nit pick
I say students numbers are about to double which means housing demand from that institution is about to double. That is a reasonable statement to make. On the other hand you come here and try to shout me down ohhhh nooo its not going to exactly dobule! Well numpty if you know the EXACT figure pray tell if not keep the gob glued as the first order estimate is sufficient unless you can improve upon it which clearly you cant

Great Ape - student numbers have gone from 19,000 to 39,000 therefore housing demand has doubled
Me - Yeah but not everyone who is a student at UCL needs housing, so housing demand hasn't doubled.
Great Ape - I don't understand, blah blah blah, you're an idiot, blah blah blah.
Me - See above.

Your too kind I would have taken the great out of it and just put
Ape: ....
Me...
Ape...


And to prove my great ape status, do you think all the students when it was at 19,000 needed local housing? No of course not. So when it roughly doubles the local housing demand roughly doubles too. Unless of course the new in take are vastly different from the old intake.

Poor UCL has fallen down quite a lot if their masters students cant even figure that out...

Does this help?

Yes it does. It shows in your hate to pick an argument with me you've made a fool of yourself
Sure the additional students dont all need housing, but the existing students were more or less the same. So a doubling does indeed more or less double local housing demand from that institution

I'll come to the immigrants in part 2 with an equally simplistic explanation for you. Trying to have a sarcastic dig about success is water off a ducks back I'm afraid - I'm very happy.

Im glad to hear it I only said it in jest. I do of course hope you have and will continue to do well in your life in every way possible

GreatApe

Windofchange wrote: »

Where have I sulked about immigrants being able to buy a house / flat? Where have I bemoaned the fact that immigrants or anyone else for that matter can afford housing? Find me a post that I have made saying damn all these pesky immigrants, I wish they would just go away? As per the above, you can't can you?

Where did you get that from?
I said look housing is so cheap the recent migrant ownership level is now almost 50% and the long term migrant ownership rate is 70%
You went off on one about how not all migrants are poor some are oil men others are football coaches and look the migrants earn a few pennies more per hour an the locals none of that had any bearing to what I said which I will say once more. 50% of recent migrants are owners and that goes towards 70% for long term migrants what do you make of that?

You yet again are unable to extrapolate the argument that is being presented. This has all stemmed from you sarcastically replying to another forum member that because 47.9% of immigrants can buy a house, that means that it is affordable. You can throw around whatever jargon you want, but I'm not making a comment on the numbers of immigrants affording housing. As per the above, let's break it down for you:

If nearly 50% of recent migrants can buy a house and 70% of longer term migrants own their own home why are you moaning so much about how hard it is to become a homeowner? BTW these figures are actually even higher if you take the fact that 17% of the stock is social so its like 70% out of an actual available pool of 83% of non social homes are owner occupied by longer term migrants. 70/83 = 84%

Great Ape - 47.9% of immigrants who have come here with nothing but the clothes on their back can buy a house within 5 years. That proves how cheap housing is.
Me - Here is a report showing that actually immigrants earn pretty much comparable amounts of money to the indigenous population of the UK.
Great Ape - I've already explained how I am right, re-instatement value of houses, blah blah blah, you're stupid.
Me - Immigrants can mean all sorts of people from investment bankers to footballers to beggars. How does saying that 47.9% of them buying houses support your statement that housing is cheap.

The figure is closer to 70% for longer term migrants that is to say they keep increasing their ownership level. Unless you think all these 70% migrants are wealthy investment footballers how do you explain their high ownership rate?

Great Ape - I don't care what jobs they have, they are getting on with life and I'm right
Me - Well, it kind of does matter what jobs they have in light of your argument
great Ape - I've already proven I'm right, you're stupid.

Why/How do migrants have 50% and going towards 70% ownership if prices are so unaffordable?

As per the previous post, your comments about UCL are water off a ducks back - you unfortunately can't argue with stupid.

It has indeed proven a stain but no need to call yourself names

Do please get back to me with examples of posts that I have made which show that I am sulking about immigrants buying houses, or where I have stated there will be no increase in housing demand from increased numbers of students at UCL.

You are one powerful individual windy.
I have changed my views completely in the course of our discussions
My new mantra will be that house prices are unaffordable, the world is !!!!, the country is even worse and we might as well all lie down and die.
Is there a website or forum you could recommend to me that might reinforce those beliefs further?

economic

economic wrote: »

as with any money management decision, the money to fund your idea will need to make it worthwhile for the taxpayer. because the loans are only inflation linked, unless there is an additional rate they need to pay on the loan it would be free funding by the taxpayer. now the question is would your idea help the average taxpayer in another way? im not sure they will at least not without exhausting other better ways.

also the money that otherwise would fund your idea would instead be used to reduce the deficit and so less likely for tax hikes which would already be a direct benefit for the economy.

for the education bubble problem - why not just phase it in slowly to stop funding degrees? start with the worst like david beckham studies and womens rights. and gradually stop more over the years. and encourage apprenticeships by companies by looking carefully at and possibly overhauling company laws.

i dont see the need to put more money into financial assets such as pensions and housing when it can be used instead more directly in the economy as mentioned above.

any thoughts on my comments greatape?

thinking about this more, i would like to know from those who know, do schools teach about personal finance? anything about mortgages, debt, interest rates, taxes, investments?

if so what sort of level? i remember back when i was in school none of this was taught except how to finance a car purchase (and even then nothing about how debt can be bad if badly managed).

My theory is that perhaps this is a significant reason why people make bad decisions later in life (eg useless degrees).

Now i know probably the average 16 year old wont have any interest but if you make it a compulsory GCSE in the subject and teach is early on then at least some of it would be ingrained in their brains (at an age when the brain is not completely developed).

GreatApe

economic wrote: »

any thoughts on my comments greatape?

thinking about this more, i would like to know from those who know, do schools teach about personal finance? anything about mortgages, debt, interest rates, taxes, investments?

if so what sort of level? i remember back when i was in school none of this was taught except how to finance a car purchase (and even then nothing about how debt can be bad if badly managed).

My theory is that perhaps this is a significant reason why people make bad decisions later in life (eg useless degrees).

Now i know probably the average 16 year old wont have any interest but if you make it a compulsory GCSE in the subject and teach is early on then at least some of it would be ingrained in their brains (at an age when the brain is not completely developed).

I dont recall receiving any financial education at school
Lots of parents teach their kids that stuff but lots of parents dont.
This is one of the problems in asking a 17 year old to make the university decision they dont know what £60,000 they probably have little to no idea of how much jobs pay and what various things in life cost. Its odd we feel adults should be compensated for PPI yet we are willing to lumber children with debts they dont understand

Anyway I think I already replayed to your thread
Overall I do not think it will be a net cost but a large net saving
It can probably be funded via the private market. Long dated Index Linked gilts actually have a negative coupon. Amazing but true about -1.6% coupon on 20-40 year index linked gilts. These loans packaged up would not have quite as good a rate as gilts but even if they are 160bp above gilts they would be zero cost to the state

You could also have the housing loans on more aggressive repayment plans vs the current student loans. So not 9% above £21,000 earnings but maybe say 20% on earnings above £5,000 that way the majority would start paying down the debt from day one and many would have paid it off by their mid 30s. so they would have a house debt free in their mid 30s and have paid back their student housing loans. Compare that to the same student getting a £80k debt doing a 4 year dance degree and getting their first job age 22 instead of age 18. They will probably have to rent privately and their student debts would just been adding interest. By the same stage of mid 30s they probably have £90k debt and are still renting. The housing option is a house paid off and no debt by the same age

I am sure there would be savings elsewhere too. With ownership for the young going towards 95% they as a group would be less reliant on the state going forward. So lower housing benefits lower tax credits lower pensioner top ups etc for that group.

GreatApe

economic wrote: »

any thoughts on my comments greatape?

You can view these loans as 100% mortgages which of course used to exist in the past and before they were regulated away even though their performance was not all that bad (within priced risk)

With this idea In effect the government is giving the option of 100% mortgages upto £60k per young adult or 100% loans upto £60-£80k for studies.

I dont see why this has proven mostly unpopular on this thread.
The kids can already get 90% LTV FTB 5 year fixed mortgages for less than 2.5% interest which is less than the CPI interest I suggested. Even 95% LTV is available for about 1% point higher interest.


So fundamentally all this idea is doing is giving mortgages of 100% to young adults at CPI interest
It is not all that radical as you can already get 90% mortgages at less than CPI interest

It would however have a radical impact on student numbers and also home ownership as it would get students and parents thinking about the actual value of both a university education and savings in the form of housing

westernpromise

Windofchange wrote: »

Double the demand for housing you concluded. As per that post, you have not done any digging with the numbers, just simply presented it.

I don't really have a dog in your fight, but on this one you're manifestly wrong and GreatApe's manifestly right. If a university doubles in size two things are clear. One, it'll get worse, and two, demand for accommodation is likely to double.

If a university admits 10 students and 9 move to be near it, that means one does not. If it then admits 10 more similar pupils, the likelihood is there will be 18 who have moved and two who have not. Of course on a sample size of 10, that's not odds-on, but it's just an illustration. On a sample size of 19,000 rising to 39,000, those are significant samples and there's no reason why the 19,000 don't give a representative pointer to what a student body of 39,000 would look like.

Unless you can show that the profile of those who will make up the new numbers is demonstrably different to that of the existing cohort, and hence that there's a reason to expect that they'll consume accommodation differently, the presumption must be that they'll consume it pretty much as the current lot do.

The anecdote that you personally didn't need to move doesn't undermine this, because there are certainly those among the current 19,000 who also didn't move home in order to attend. You're already in the sample. Whatever the accommodation demand is now, net of people in it like yourself, it will likely double.

If I had to guess I'd say it would likely more than double. I say this because probably, a chunk of the 20,000-head expansion will be intended to admit overseas students who ain't very bright but pay more. They'll by definition definitely not already live locally; and a further chunk will probably be mature students who'll need space for more than just themselves.

So whereas the current University of Central London undergrad needs accommodation for 0.9 people on average (or whatever - just basing this on my 10-student illustration above), the average member of the extra intake may prove to need accommodation for 1.5 people, because 6 are as the previous intake, but 3 are half a couple and the tenth is married with a child - so that the 10 students require room for 15 people.

The latter is conjecture, of course, but my own college is more or less doubling in physical size and is using the extra space it has come by exactly to create more inviting living space for research types with young families.

economic

GreatApe wrote: »

You can view these loans as 100% mortgages which of course used to exist in the past and before they were regulated away even though their performance was not all that bad (within priced risk)

With this idea In effect the government is giving the option of 100% mortgages upto £60k per young adult or 100% loans upto £60-£80k for studies.

I dont see why this has proven mostly unpopular on this thread.
The kids can already get 90% LTV FTB 5 year fixed mortgages for less than 2.5% interest which is less than the CPI interest I suggested. Even 95% LTV is available for about 1% point higher interest.


So fundamentally all this idea is doing is giving mortgages of 100% to young adults at CPI interest
It is not all that radical as you can already get 90% mortgages at less than CPI interest

It would however have a radical impact on student numbers and also home ownership as it would get students and parents thinking about the actual value of both a university education and savings in the form of housing

so this would only be available to 18 year olds say from next year, what about those who turned 19 next year, they would be p*ssed off they were born a year earlier. how would you propose managing that?

westernpromise

There's actually a third thing that happens when a university doubles in size which is that the value of the degrees tends to fall because everybody's got one, but that's not really relevant.