Boris announcement on new deposit scheme?

grumiofoundation

Hannimal said:

grumiofoundation said:

grumiofoundation said:
For some who wants to ignore generalisers you make a lot of generalisations.
By definition someone who cannot save while renting (which according you you is everyone) is unaffected whether mortgage deposits are 5% or 25%.

Hannimal said:
I'm not sure that is right. Being on just over £40k pa and paying £1200pcm in rent, I certainly could only save a very small amount. I can afford far more now that I am paying mortgage payments that are about half of what I paid in rent. Renting is bloody expensive. 

The original poster claimed "You simply cannot save whilst renting" - which is blatantly not the case for everyone who rents. Lumping all renters in the same boat does not help anyone. See any irony here between your comments I've put in italics?  

You are slipping into the same trap. Renting is not inherently "bloody expensive", it depends on your circumstances (where you live in the country is a large determinant of this of course). In the same way is not hard to save while "renting", it is hard to save when a large % of your take home pay goes on rent (or indeed mortgage) and other essentials. 

As you say above someone on 80k in London(or a couple on 80k) shouldn't need any help with getting on the property ladder. But that is not at all what I said

Quite a large number of people who claim sweepingly "You simply cannot save whilst renting" (and are unfortunately often the most vocal) have highly paid jobs and don't save money simply because they spend it on non-essentials or make choices to spend it but then won't accept the choices they have made. Not because they have no other choice. Okay boomer.

Text in bold mine.

No discernible irony - I think you may have read I am saying all renters can save. I am saying not all renters cannot save (which was originally postulated). 

In my opinion it would be better for everyone if the sweeping view that property ownership is 'impossible' for anyone who isn't given money by their parents could be abandoned and then help could actually be targeted at those who need it (Edit - not just for property ownership but also to improve the renal sector). However this is unlikely to change while people behave as though a response of "Okay boomer" is in some way a valid response to a comment that dares even imply there might be a few renters who could buy if they learnt to control their spending. I assume from this glib response you either agree with my point but in some way think that my (perceived) generation is relevant. More likely you want to disagree with it but cannot form a coherent argument against it and in someway think that "Okay boomer" is a way to win an argument (Maybe you believe someones ages in some way invalidates their point?). Unless of course you can produce evidence that there are no renters on good salaries who are in any way wasteful with money? 

Judging from this response you seem to have taken my point as a personal dig at you, wasn't in any way meant as such.


Best wishes from a millennial renter (on a lower salary than you).

Hannimal

grumiofoundation said:

However this is unlikely to change while people behave as though a response of "Okay boomer" is in some way a valid response to a comment that dares even imply there might be a few renters who could buy if they learnt to control their spending. I assume from this glib response you either agree with my point but in some way think that my (perceived) generation is relevant. More likely you want to disagree with it but cannot form a coherent argument against it and in someway think that "Okay boomer" is a way to win an argument (Maybe you believe someones ages in some way invalidates their point?). Unless of course you can produce evidence that there are no renters on good salaries who are in any way wasteful with money? 

I am willingly going to admit I could not have bought property without coming to inheritance for another few years. I did not take your comment as a personal dig as I think I am very frugal and savvy with my money, and I managed to save 5-10k pa which is a lot for someone with my income and the rent i was paying.

Having said that, the reason I am irked by your comment is because you seem to have no awareness of what life is like for majority of people in their 20s and 30s. One in five young people work in the hospitality industry. On average bar staff make around £16k pa. Similar salaries for people working in cafes and restaurants. UK median salary might be around 30k pa but that is dragged up by the population structure and older employees bringing in larger salaries. The median salary for a 25-year-old in full time employment is around £25k. I know a lot of people in their mid-thirties who are making around £20k pa.

Pop in taxes, rent and other living expenses and be reminded that the average first time buyer in Bristol forks out around £225,000 at the moment and you'll quickly notice that you don't make those kinds of savings merely by being frugal. 

Even the most generous lender will only give you around 5x your salary. That means that on 20k pa you can get 100k. In bristol that means you need another 100k in saving to get on the property ladder. The problem is not people being unable to control their spending. Your comment is so out of touch and tone-deaf it really is a bit incredible. 

grumiofoundation

Hannimal said:

grumiofoundation said:

However this is unlikely to change while people behave as though a response of "Okay boomer" is in some way a valid response to a comment that dares even imply there might be a few renters who could buy if they learnt to control their spending. I assume from this glib response you either agree with my point but in some way think that my (perceived) generation is relevant. More likely you want to disagree with it but cannot form a coherent argument against it and in someway think that "Okay boomer" is a way to win an argument (Maybe you believe someones ages in some way invalidates their point?). Unless of course you can produce evidence that there are no renters on good salaries who are in any way wasteful with money? 

I am willingly going to admit I could not have bought property without coming to inheritance for another few years. I did not take your comment as a personal dig as I think I am very frugal and savvy with my money, and I managed to save 5-10k pa which is a lot for someone with my income and the rent i was paying.

Having said that, the reason I am irked by your comment is because you seem to have no awareness of what life is like for majority of people in their 20s and 30s. One in five young people work in the hospitality industry. On average bar staff make around £16k pa. Similar salaries for people working in cafes and restaurants. UK median salary might be around 30k pa but that is dragged up by the population structure and older employees bringing in larger salaries. The median salary for a 25-year-old in full time employment is around £25k. I know a lot of people in their mid-thirties who are making around £20k pa.

Pop in taxes, rent and other living expenses and be reminded that the average first time buyer in Bristol forks out around £225,000 at the moment and you'll quickly notice that you don't make those kinds of savings merely by being frugal. 

Even the most generous lender will only give you around 5x your salary. That means that on 20k pa you can get 100k. In bristol that means you need another 100k in saving to get on the property ladder. The problem is not people being unable to control their spending. Your comment is so out of touch and tone-deaf it really is a bit incredible. 

I don't know if you are being deliberately obtuse or just not bothering to read what I am actually writing.

What exactly have I said that is "tone deaf"? Have I trotted out any of the common stereotypes that are often flung at young people struggling to buy a house -everyone could buy a house if they "worked hard", have I said that all millennials waste money, have I said that it was always this hard to buy a house, have I argued that it is not harder now than it was in the past to buy a house? Did I claim that what is stopping a single person on 20k buying a 225k property in Bristol is that they spending too much? 

Nope but apparently daring to suggest that some young people might be wasteful with money is apparently out of touch and tone-deaf. 

What I am saying is that there there are a small, but significant and importantly vocal, minority of people on good wages (lets say >2000 per month take home pay, no caring responsibilities) who would be able to get on the housing ladder within say 2-5 years of starting a well paid graduate job if they did not spend most/all their income. When these people (not people on low incomes, not people with high essential outgoings) complain they cannot buy a house because it is 'impossible' to save for a deposit while renting - a) how is that in itself not tone deaf and b) how does pandering to their whining help improve the housing situation of, for example, someone on minimum wage, in insecure employment, with children to care for?

This vocal minority, in my opinion, tend to be be greatly overrepresented in debates on housing meaning that a) people on lower wages, who actually need help, are not listened to as much as they should be, b) it gives people the opportunity to dismiss all young people are feckless and financially irresponsible (which you seem to think I am doing) and c) it means that initiatives aimed a solving housing problems in this country get skewed towards helping this group, who by and large don't really need any help other than to buy a bigger, more expensive house slightly sooner. 

nickstone

Hannimal said:

nickstone said:

Hannimal said:

If you have the kind of salary that you can afford to buy a house on a 5% deposit in London, you'll likely be fine. The average FTB in London forks out £453,385 for their new home. With a 5% deposit they'd need a mere £68 000 in savings. That means they'd need a mortgage of about £385,380 and therefore an annual salary pre tax of about £80 000. These people are fine in being able to afford mortgage costs even if they rise considerably. They are likely already paying more than that in rent.  

But in London the HTB gives 40% interest free for five year

I'm not sure that changes my point in any way. You still have to be on a pretty high salary to be able to buy on 5%

Not really 

property is falling fairly fast in London, both rents and property prices 

if someone can get 40% HTB, and they borrow the 5% deposit then they only need a mortgage for 55%

nickstone

Crashy_Time said:

MobileSaver said:

Crashy_Time said:

MobileSaver said:

Crashy_Time said:

The irony is the article confirms exactly what many of us here predicted and what you repeatedly ridiculed: "People are leaving the city ... and they work from home elsewhere". So yes of course there will be less demand (and therefore lower prices/rents) in undesirable areas which will be balanced by higher demand in nicer areas.

So London is an "undesirable area" now? LOL

That's hilarious! You were the one that to prove your point linked to an article that says "tenants are fleeing London, and the property market is cracking" and then an hour later you're discrediting what the article says!

Crashy_Time said:

What happens to demand if the person already owns a home "elsewhere", or moves back with their parents "elsewhere"

Yes, some people will have an empty second home and yes a small number of people will move back to parents but to suggest 100% of all those people moving out of the cities have one or the other is ludicrous. QED there will be an increase in demand in other areas.

Crashy_Time said:

I suppose you think your area is "desirable"?

The facts speak for themselves; as of today only two properties are available to buy (and none available to rent) in my area and one of those only came on the market last month, even the listed building I've mentioned before is now SSTC...

The link is about falling rents in London, and better deals for people renting in London, no one (except you it seems) expects London to be empty this time next year, why can`t you just accept that rents can fall as well as rise, LOL. No one is saying 100% of anybody is doing anything, the market is made up of various levels of sentiment and behaviour, which is even harder to predict in the present climate. What I AM saying is that a lot of young people have the option of going to parents, meaning the landlord loses out, and the effect of a proper recession plus likely difficult Brexit has to be taken into consideration.

I can confirm rents are now in noticeable decline in London.

Its starting from the centre and working its way further out, the odd thing is some of the outside parts haven’t yet fallen as much as the central areas, so rents are lower in central areas then formerly cheaper areas.

the outer areas will catch up with the falls.

the problem is that so many businesses are going bust and laying off huge swaths of Londoners, and most of those who haven’t been laid off yet are working from home. They find they can move somewhere much cheaper which is why the urban flight situation is so common now.

if this trend continues there are going to be more and more empty properties adding even more to supply when demand is reducing every month.

plus there was a building bubble in London adding even more supply to the empty property market.

Its good news for tenants in London, there are so many increasingly desperate LLs looking to find someone to rent their properties to, causing a rent reduction bidding war, all trying to undercut each other fighting over the decreasing number of good tenants left.

Hannimal

grumiofoundation said:

What I am saying is that there there are a small, but significant and importantly vocal, minority of people on good wages (lets say >2000 per month take home pay, no caring responsibilities) who would be able to get on the housing ladder within say 2-5 years of starting a well paid graduate job if they did not spend most/all their income. When these people (not people on low incomes, not people with high essential outgoings) complain they cannot buy a house because it is 'impossible' to save for a deposit while renting - a) how is that in itself not tone deaf and b) how does pandering to their whining help improve the housing situation of, for example, someone on minimum wage, in insecure employment, with children to care for?

I  belong to that category then. I make >2000pcm but there was no way I could've saved for a house deposit in 2-5 years on that salary while paying rent. That is unrealistic. 2000pcm is only about £1655 pcm in net. If you're paying rent, bills and council tax on that, even if you weren't spending on anything else, you'd be saving max about 8-9k per year. And that's assuming you don't eat. You could MAX get a 120k mortgage on that salary and that would mean you'd have to save 80k. That's more than 4x the entire salary after tax. 

Crashy_Time

MobileSaver said:

Crashy_Time said:

MobileSaver said:

It's always funny when you link to articles that completely undermine your position!

From the article, "We do not expect any immediate impact on prices." so looks like a house price crash any time soon has been cancelled (again!) It's no wonder you always ignore the question when asked "is it crashy time yet?"

So how can an article that predicts massive transaction drops possibly undermine my position!

Oh I see! So all these years you've been predicting "crashy time" you never once meant prices would crash, you were always talking about transactions? LOL

Of course your new position is just as flawed as your old one; why would less transactions skew prices higher rather than lower?

For the avoidance of doubt is Sky News now your "go to" expert on house prices?

Be honest, when the likes of SKY news are openly saying it is a bubble, and asking "how long can it continue" you have to admit that the theory about the need for "sock puppets" discussed on here recently to put forward the idea that we are heading for a crash is pretty strange thinking, it is true Head in the Sand logic?

https://www.thetimes.co.uk/article/all-first-time-buyers-really-want-is-a-big-housing-crash-fhlvw9p33?wgu=270525_54264_16030175348419_e75f801bbf&wgexpiry=1610793534&utm_source=planit&utm_medium=affiliate&utm_content=22278

Crashy_Time

nickstone said:

Crashy_Time said:

MobileSaver said:

Crashy_Time said:

MobileSaver said:

Crashy_Time said:

The irony is the article confirms exactly what many of us here predicted and what you repeatedly ridiculed: "People are leaving the city ... and they work from home elsewhere". So yes of course there will be less demand (and therefore lower prices/rents) in undesirable areas which will be balanced by higher demand in nicer areas.

So London is an "undesirable area" now? LOL

That's hilarious! You were the one that to prove your point linked to an article that says "tenants are fleeing London, and the property market is cracking" and then an hour later you're discrediting what the article says!

Crashy_Time said:

What happens to demand if the person already owns a home "elsewhere", or moves back with their parents "elsewhere"

Yes, some people will have an empty second home and yes a small number of people will move back to parents but to suggest 100% of all those people moving out of the cities have one or the other is ludicrous. QED there will be an increase in demand in other areas.

Crashy_Time said:

I suppose you think your area is "desirable"?

The facts speak for themselves; as of today only two properties are available to buy (and none available to rent) in my area and one of those only came on the market last month, even the listed building I've mentioned before is now SSTC...

The link is about falling rents in London, and better deals for people renting in London, no one (except you it seems) expects London to be empty this time next year, why can`t you just accept that rents can fall as well as rise, LOL. No one is saying 100% of anybody is doing anything, the market is made up of various levels of sentiment and behaviour, which is even harder to predict in the present climate. What I AM saying is that a lot of young people have the option of going to parents, meaning the landlord loses out, and the effect of a proper recession plus likely difficult Brexit has to be taken into consideration.

I can confirm rents are now in noticeable decline in London.

Its starting from the centre and working its way further out, the odd thing is some of the outside parts haven’t yet fallen as much as the central areas, so rents are lower in central areas then formerly cheaper areas.

the outer areas will catch up with the falls.

the problem is that so many businesses are going bust and laying off huge swaths of Londoners, and most of those who haven’t been laid off yet are working from home. They find they can move somewhere much cheaper which is why the urban flight situation is so common now.

if this trend continues there are going to be more and more empty properties adding even more to supply when demand is reducing every month.

plus there was a building bubble in London adding even more supply to the empty property market.

Its good news for tenants in London, there are so many increasingly desperate LLs looking to find someone to rent their properties to, causing a rent reduction bidding war, all trying to undercut each other fighting over the decreasing number of good tenants left.

I have heard recently about landlords dropping rent by up to 200 p.m from the original asking rent in Scotland to get a tenant in.

MobileSaver

Crashy_Time said:

MobileSaver said:

For the avoidance of doubt is Sky News now your "go to" expert on house prices?

Be honest, when the likes of SKY news are openly saying it is a bubble,

A Sky News article from just last week:

Sky News: Housing market has boomed

Sky News said on 12th October 2020 "Despite the UK going into recession, the housing market has boomed"

What a great time to be and become a home owner!

Crashy_Time said:

MobileSaver said:

For the avoidance of doubt is Sky News now your "go to" expert on house prices?

the theory about the need for "sock puppets" discussed on here recently to put forward the idea that we are heading for a crash is pretty strange thinking

Are you honestly saying that someone like "nickstone" is not a sock puppet that will be banned within the next 48 hours just like all the similar sock puppets over the last few months?

Getting_greyer

I don't see how this actually helps ftb buy a home?  Even if the plan involved forcing banks to offer 50% discount on market intersest rate for 95% mortgages all it would do is increase affordability slightly by lowering monthly payment? 

This may help proportionally more those that are buying cheaper places, such as flats, as less deposit required.  But if the scheme involves very long fixes then your one bed flat may not be suitable in 7 years.  

Maybe I'm missing something but the LISA scheme is better as actually removes 20% of the deposit to be saved.