Are we expecting BOE to remain at 4.75% on 8th February 2025?

lojo1000

MeteredOut said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

It could actually increase prices (and, therefore rents); if the seller (who did not want to sell) now knows that the buyer has an incentive to buy the property, they might just be open to selling if the buyer ups their offer above market value...

And that is the point, it incentives a sale and bringing the property back into use.

MeteredOut

lojo1000 said:

MeteredOut said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

It could actually increase prices (and, therefore rents); if the seller (who did not want to sell) now knows that the buyer has an incentive to buy the property, they might just be open to selling if the buyer ups their offer above market value...

And that is the point, it incentives a sale and bringing the property back into use.

But not without pushing prices and rents up...

MobileSaver

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

You're cherry picking from my posts so I will repeat in full my suggestion re BTL:

1. Cap leverage to reduce returns to BTL investors freeing up housing for owner-occupiers
2. Reduce stamp duty on properties not in use and brought into use by BTL  on otherwise not in use properties, to increase returns to BTL investors.

As previously stated both suggestions are fundamentally flawed!

1) By "freeing up" housing for owner-occupiers you're just reducing the availability of housing for renters so you've gained an owner-occupier house but lost a rental house, what's the benefit to the housing market of that?!?!

2) Properties "not in use" are generally always also "not for sale" so incentivising buyers is pointless and as @MeteredOut pointed out would probably just result in sellers knowing you could now afford to pay an extra 3% anyway since you no longer have to pay stamp duty!

MobileSaver

lojo1000 said:

MeteredOut said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

It could actually increase prices (and, therefore rents); if the seller (who did not want to sell) now knows that the buyer has an incentive to buy the property, they might just be open to selling if the buyer ups their offer above market value...

And that is the point, it incentives a sale and bringing the property back into use.

I thought the point was to bring prices down?!?! You're now suggesting the point is to increase prices to get more property on the market? Sounds like a great plan.

lojo1000

MobileSaver said:

lojo1000 said:

MeteredOut said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

It could actually increase prices (and, therefore rents); if the seller (who did not want to sell) now knows that the buyer has an incentive to buy the property, they might just be open to selling if the buyer ups their offer above market value...

And that is the point, it incentives a sale and bringing the property back into use.

I thought the point was to bring prices down?!?! You're now suggesting the point is to increase prices to get more property on the market? Sounds like a great plan.

Encouraging properties back into use (increasing housing supply) negates the negative impact of higher demand. The extra demand is satisfied by the extra supply.

lojo1000

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

You're cherry picking from my posts so I will repeat in full my suggestion re BTL:

1. Cap leverage to reduce returns to BTL investors freeing up housing for owner-occupiers
2. Reduce stamp duty on properties not in use and brought into use by BTL  on otherwise not in use properties, to increase returns to BTL investors.

As previously stated both suggestions are fundamentally flawed!

1) By "freeing up" housing for owner-occupiers you're just reducing the availability of housing for renters so you've gained an owner-occupier house but lost a rental house, what's the benefit to the housing market of that?!?!

2) Properties "not in use" are generally always also "not for sale" so incentivising buyers is pointless and as @MeteredOut pointed out would probably just result in sellers knowing you could now afford to pay an extra 3% anyway since you no longer have to pay stamp duty!

1. When people who previously rented buy a house, they no longer are creating demand to rent a house. The market is clearly skewed toward creating higher house prices else the price/wage ratio would not have increased from around 3 to 8 now.
2. Not sure where you've got your information from about "generally always"? And you seem conflicted between whether such houses would be for sale or would not be for sale.

MobileSaver

lojo1000 said:

MobileSaver said:

lojo1000 said:

MeteredOut said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

It could actually increase prices (and, therefore rents); if the seller (who did not want to sell) now knows that the buyer has an incentive to buy the property, they might just be open to selling if the buyer ups their offer above market value...

And that is the point, it incentives a sale and bringing the property back into use.

I thought the point was to bring prices down?!?! You're now suggesting the point is to increase prices to get more property on the market? Sounds like a great plan.

Encouraging properties back into use (increasing housing supply) negates the negative impact of higher demand. The extra demand is satisfied by the extra supply.

Yes, the extra demand is cancelled out by the extra supply but you are agreeing that prices may rise to get that extra supply which I thought was the opposite of what you were hoping to achieve?

MobileSaver

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

You're cherry picking from my posts so I will repeat in full my suggestion re BTL:

1. Cap leverage to reduce returns to BTL investors freeing up housing for owner-occupiers
2. Reduce stamp duty on properties not in use and brought into use by BTL  on otherwise not in use properties, to increase returns to BTL investors.

As previously stated both suggestions are fundamentally flawed!

1) By "freeing up" housing for owner-occupiers you're just reducing the availability of housing for renters so you've gained an owner-occupier house but lost a rental house, what's the benefit to the housing market of that?!?!

2) Properties "not in use" are generally always also "not for sale" so incentivising buyers is pointless and as @MeteredOut pointed out would probably just result in sellers knowing you could now afford to pay an extra 3% anyway since you no longer have to pay stamp duty!

1. When people who previously rented buy a house, they no longer are creating demand to rent a house.
2. Not sure where you've got your information from about "generally always"? And you seem conflicted between whether such houses would be for sale or would not be for sale.

1) Yes, agreed, they no longer create demand to rent a house which is fine because that house is no longer available to rent so the two actions cancel each other out - again, what's the benefit to the housing market of that?!?!

2) I'm envisaging your "not in use" properties as being those that are low value and long term empty (small second homes, outdated inheritances, wrecks etc.) where the owner just isn't interested in selling for whatever reason. What are you using as your definition of "not in use" properties for your incentive policy?

Regardless, you've already agreed with @MeteredOut that this policy may actually lead to price increases so I'm not really sure what point you are trying to make anymore?

BikingBud

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Spend vast amount of money that was set aside for a vanity project HS2, to build what the country really needs, affordable housing

lojo1000

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

MobileSaver said:

lojo1000 said:

The price of assets rising is not the illogical result, it's peoples willingness to enter into debt to buy those assets.

Ignoring the inconvenient truth that a third of all property bought in the UK is bought with cash and no debt... what is the alternative for Joe Bloggs and his partner who need somewhere to live?

I'm not sure whether you mean somewhere to buy, as opposed to somewhere to rent or buy?

I don't see that it really makes much difference? Everyone needs somewhere to live and "debt" is simply owing someone money. 

You either buy and then you owe money to the bank every month or you rent and you owe money to the landlord every month... both are a necessary debt.

lojo1000 said:

it is very hard not to over commit to debt. Renting, whilst all around you are paying incredible multiples of their income on housing and seeing them 'get on the property ladder', is hard for most people.

Typically monthly rents are higher than monthly mortgages and fundamentally mortgages are normally paid off after so many years while rent has to be paid every single month for pretty much the rest of your life. Simply by looking at renting v buying from a debt point of view, it's clear that buying is almost always the smarter option as at the end of the day it's the lesser "debt".

lojo1000 said:

Also, I understand many people view ownership differently from rent in terms of the security it gives them.

That would be because they obviously are completely different. If you buy and pay your mortgage every month then it's your house so you can stay there forever if you want and pretty much do whatever you want within your own home.

Conversely if you rent then you don't have either of those luxuries; it's not your house so you can be made to leave if the landlord no longer wants to rent to you and you're limited in what you can do in your own home.

lojo1000 said:

My practical solution is to limit the amount of leverage allowed in buying a house. Reducing debt, reduces returns to equity in the purchase and hence BTL becomes less attractive.

the ever-upward spiral of prices in excess of incomes is not good for our society and the future of our children?

The government has been implementing anti-BTL measures for years, remind me again what's happened to both house prices and rental prices since they started doing this?

We live in a capitalist market economy ruled by supply and demand. You can tinker at the edges to reduce demand but ultimately more people than ever want/need a house and there are not enough of what they want and where they want them to go around. 

So the only solution left is to increase supply, basically we need to be building loads more houses in the areas that people want them. However even this isn't a magic bullet as it's not just house prices that have risen but similarly labour and materials are much higher now than they used to be so these mass-produced new houses are probably not going to be as cheap as some people might like; the eternal HPC dream of half-price houses is just never going to happen.

The reason why there seems to be a shortage of houses to buy was that so many were bought by BTL (previously owner-occupied houses) to put into the rental sector thereby reducing housing available to buy.

If we discourage investors (returns), it will bring down demand for housing whilst freeing up supply to buy and thereby bring prices down.

Let's say your cunning plan works and you do a better job than the government of getting rid of BTL properties... where will all those people who want or need to rent live?

Govt should use tax policy to incentive BTL industry to bring in to use housing which is not in use (thereby raising supply of homes for rent). Waive stamp duty on houses not in use >1 year if brought in use within 1 year post purchase. The BTL landlord gets a stamp duty bill as normal on purchase but if the property was not previously in use this can deferred for 1 year if the buyer elects at time of purchase. Duty becomes due in 1 year unless BTL landlord evidences property is now brought into use.

Wow, in less than 24 hours you've gone from discouraging BTL completely to now incentivising BTL but on "not in use" property... that's a quicker U-turn than even the government of the day can manage! 

There are a couple of reasons why your new cunning plan won't work...

The issue regarding "not in use" properties isn't because people don't want to buy them, it's down to sellers not wanting to sell them for whatever reason; so tax incentives to buy them will have practically no effect.

The fundamental flaw though is that if a BTL investor does buy an incentivised empty property then as soon as it's back in use and being rented the investor is hit with all the other anti-BTL rules and regulations that have been imposed in recent years. I.e. the very reason that so many landlords are getting out of BTL in the first place and why renting for tenants is getting harder and more expensive as every year goes by.

You're cherry picking from my posts so I will repeat in full my suggestion re BTL:

1. Cap leverage to reduce returns to BTL investors freeing up housing for owner-occupiers
2. Reduce stamp duty on properties not in use and brought into use by BTL  on otherwise not in use properties, to increase returns to BTL investors.

As previously stated both suggestions are fundamentally flawed!

1) By "freeing up" housing for owner-occupiers you're just reducing the availability of housing for renters so you've gained an owner-occupier house but lost a rental house, what's the benefit to the housing market of that?!?!

2) Properties "not in use" are generally always also "not for sale" so incentivising buyers is pointless and as @MeteredOut pointed out would probably just result in sellers knowing you could now afford to pay an extra 3% anyway since you no longer have to pay stamp duty!

1. When people who previously rented buy a house, they no longer are creating demand to rent a house.
2. Not sure where you've got your information from about "generally always"? And you seem conflicted between whether such houses would be for sale or would not be for sale.

1) Yes, agreed, they no longer create demand to rent a house which is fine because that house is no longer available to rent so the two actions cancel each other out - again, what's the benefit to the housing market of that?!?!

2) I'm envisaging your "not in use" properties as being those that are low value and long term empty (small second homes, outdated inheritances, wrecks etc.) where the owner just isn't interested in selling for whatever reason. What are you using as your definition of "not in use" properties for your incentive policy?

Regardless, you've already agreed with @MeteredOut that this policy may actually lead to price increases so I'm not really sure what point you are trying to make anymore?

I think this conversation started about house prices being high relative to incomes to which I suggested introducing a leverage cap. That would act to bring house prices or at least the ratio down.

Secondly, someone raised the issue of BTL. My suggestion re BTL is cap leverage to a lower level (then owner-occupier), I think I said 50% as opposed to 80% for owner-occupier. That acts as a downward force on prices.

Someone also mentioned properties not in use and my suggestion was waive stamp duty for BTL to bring properties out of non-use into use.

I think the overall impact of those policies would have a greater impact on reducing prices than raising prices.

You may see things differently and that's fine. I don't know or pretend to know the answers. I'm simply putting forward ideas and would be happy to read yours or anyone else's.