I struggle to get my head around the size of the Chinese property collapse & it's global consequences.

[StrawberryMarble]

Is anyone else following this? Because it will affect us for sure down the line. 65 MILLION properties in China are in a limbo of being half built & the developers have run out of funds. This is way way bigger than the sub-prime crisis in the US. Blocks of flats are being demolished in their thousands. The Chinese government is pumping trillions in to keep the economy afloat. I think we're in for an unprecidented global recession that will bite longer & harder than ever before when you add in the cost of covid and the energy crisis.

re home ownership things are changing and the proportion of young people buying is going up, don’t forget that many more will be set to inherit property wealth etc so that will make a difference too.

But for many whether they own a home will depend on whether they inherit as opposed to their job. That is surely going to make inequality worse?

The thing is having more children becomes a pyramid scheme you then need further children to support the elderly and so on it goes. We need to start investing in automation as time goes on. It's not necessarily a bad thing population is decreasing it's not bad for the environment,bwe need to plan properly . China's demographic shift will be more rapid than ours we have more time.

This I can't see how that's a good thing.

And here he is on Triggernometry recently

But for many whether they own a home will depend on whether they inherit as opposed to their job. That is surely going to make inequality worse?

Yes it will make inequality worse. I’m not saying this is a good thing I’m saying that it doesn’t necessary mean that we’ll see less and less people reaching retirement without owning a home.

Population decline and tackling the demographics are the big societal changes we absolutely need to protect the planet for future generations. No one said it was going to be easy. No one’s investment of money in anything is ever guaranteed to increase in value.

I for one think robots/automation need to be taxed as if they were human workers. And that tax goes direct into social care/pensions/healthcare for the elderly.

Tbh it’s for another thread but personally I think property should be taxed just like any other asset. There’s no reason that one group of people should be able to accumulate so much wealth tax free when another group don’t have access to the same opportunity (and within that group those who have the most money make the most money). It’s the only way to redistribute some of the enormous gains that people have made.

But I don’t want to derail!!!

I for one think robots/automation need to be taxed as if they were human workers

ooo interesting!!

We have already seen a huge increase in middle aged and older people renting and not owning a home. Its only going to get worse.
www.bbc.co.uk/news/business-43504015
www.heraldscotland.com/news/17709870.home-renters-50-reach-record-levels-across-uk/

Yes it will make inequality worse. I’m not saying this is a good thing I’m saying that it doesn’t necessary mean that we’ll see less and less people reaching retirement without owning a home.

that's true.

Tbh it’s for another thread but personally I think property should be taxed just like any other asset. There’s no reason that one group of people should be able to accumulate so much wealth tax free when another group don’t have access to the same opportunity (and within that group those who have the most money make the most money). It’s the only way to redistribute some of the enormous gains that people have made.

Absolutely agree.

Property is taxed as in council tax? Although it’s properly classified as a property occupancy tax but still if homeowner you’re paying it unless you have tenants in the property.

I do think some funny accounting is going on with council tax though as places worth millions in the most elite London boroughs have lower council tax bills than a regular home in a northern deprived city. They need to be standardised across the country and there should never be a case of an owner of a £14m place in London paying lower council tax than the owner of a £350k place in the north.

We have already seen a huge increase in middle aged and older people renting and not owning a home. Its only going to get worse.

Middle aged yes, older no. Among people over 65 the proportion owning homes is still growing and is at record levels (around 80%). The proportion of people renting socially in retirement has fallen by 10% in the past 15-20 years to about 14%. The proportion of people renting privately has only gone up from about 4.5% to about 5.5%. See English Housing Survey. It’s definitely a problem in age groups 40-55 and we don’t yet know what impact inheritance will have an a population level.

Surely though the worst thing for the planet is more people. I find this focus on population increase worrying. Why do we keep people artificially alive when they can't even function e.g with advanced dementia. Why do we keep developing medicines to keep people alive when their quality of life is zero and in past times they would have died.

People expect the government and the general tax payer to fund any lifestyle. The consequences of any lifestyle.

Additionally it seems to me we are awash with low paid jobs, this means low tax take. We need lots of people to fill that tax gap but surely what they'll 'use' will be more?

Property is taxed as in council tax? Although it’s properly classified as a property occupancy tax but still if homeowner you’re paying it unless you have tenants in the property

Good point but it’s absolutely tiny compared to the gains people have made because of price increases, some of which average out at about 5% a year over decades.

You can never believe anything the Chinese government says, all we can do is judge their public statements with scepticism, one fact we know, the state is in total control of the population. They are not accountable like a democracy, they don’t respect human rights or commercial law, because we are dependant on them for much of our technology there is nothing we are going to do about it.

As for Chinese property crash affecting our economy, it may do,
because some pension funds will have Chinese investments that will have lost money, but no widespread crash.

completely agree. And as someone with a parent who died from dementia sadly I have to say there were times I knew they didn’t want to be here either 😓

And yes about low paid (as well as low skilled… but not all low paid jobs are low skilled) jobs too. It will take years to turn around.

@Discovereads yes council tax is weird. I'm in London & was quite shocked by what other people pay outside of London. My relative lives in another borough & pays almost the same CT as me for a house 3x as big & worth close to 2m. It's very inconsistent

Yes, agree but to my mind the fall in home ownership is a bow wave that started with the younger generation and is rippling upwards as time goes on. The over 65s are all baby bombers so of course home ownership is at record highs for them. And the statistic for the 45-55yr olds is worrying because many will have already lost both parents, so there’s no further inheritance coming.

Among people over 65 the proportion owning homes is still growing and is at record levels (around 80%).

Is that because more have multiple homes or is that based on one home? I'm sure I read that home ownership is falling but simultaneously multiple home ownership is increasing. And generally it's older people who have more than 1 home.

That’s another problem with it. Where I last lived the band was based on the 1991 value of the home! Should be regularly updated every 5yrs. Because places that were nice in 1991 have been left to go to wrack and ruin as private rentals while places that were shacks in 1991 have been extended upwards, outwards, completely restored and so on. In fact, it’s a “thing” to buy a run down home in a low council tax band and then massively extend on it deliberately to avoid buying a ready made home in a higher council tax band that would normally apply to the size and quality of home you want.

That’s one home. You’re right also that second home ownership is also at highest ever levels among older people but it’s around the average of the rest of the population so not disproportionately high (but still high… around one in ten depending which survey you use)

Home ownership at population level is falling but not over 65s

It does depend on where in London, @Goshy. In our outer London borough, CT is the highest in London, and one of the highest in the country. Just down the road is the lowest in London. The difference is huge.

@GETTINGLIKEMYMOTHER yes that's true, KT is more akin to outside of London.

@Drivebye
Surely though the worst thing for the planet is more people. I find this focus on population increase worrying. Why do we keep people artificially alive when they can't even function e.g with advanced dementia. Why do we keep developing medicines to keep people alive when their quality of life is zero and in past times they would have died.

Yes, it’s a good thing that populations are stabilising and declining sooner than expected! Not a bad thing! Population is the #1 factor contributing to climate change, environmental degradation and also wars.

However the growth in over 65s isn’t due to keeping people artificially alive with zero quality of life. The over 65s are genuinely in better health and more active than in prior years…and increasing numbers are still working FT. All that’s happened is we’ve moved the average age of people “kept artificially alive” from 60+ to 80+ imho due to longer life expectancies. It doesn’t matter much what lifestyle you lead, as the last 10yrs of your life will be crap & cost a lot in healthcare spending. Whether that’s struggling with lung cancer due to smoking from age 35 and dying at 44 or coming down with dementia at age 85 and dying at 94 - the end of life costs are about the same to society no matter which decade you approach death. The fact that more people are making better choices and so living longer isn’t having the impact of increasing end of life costs. They just come later rather than sooner.