That stamp duty changes will do little to help most first time buyers?

[Creambun2]

The housing market in the uk is totally dysfunctional. This is bad for the country on many levels. Many people are not having families due to housing situation.

Not enough suitable houses being built. No houses being built for social renting.

When many people cannot even thing about buying when price to earnings ratio is crazy.

I hope all the idiots who cream themselves about high house prices realise that eventually there will be a large market correction.

And certain boomers who shit on about "I worked hard and didn't have an iphone and avacado toast" and the reason that young people can't afford housing can fuck right off. Please don't expect any sympathy from young people of all your assets are taken for your elderly care needs.

Sometimes personal spending habits are the reason why someone can't buy, young or old. More often than not I agree with you though. YANBU.
I'm not sure there is a market correction coming though.

It doesn't solve the problem completely but it will assist.

The savings in stamp will simply give some people more money to put towards the purchase price so prices will rise. It's a silly idea which will surely only benefit those already deep into the process of buying, ie over the next couple of months.
House prices are ridiculous but I'm not sure the huge correction will ever come. I thinl theyll stagnante and maybe drop a little but no more than that.
My husband has exactly the same job as his father. In the 80s FIL bought a zone 2 London new build on just his salary. His wife was a SAHM. The children had private schooling from 2-18. Nowadays we couldn't even buy half that same house never mind the extras. No amount of avocado on toast would make up that difference.

Assist? What by increasing prices more?

It will help very few first time buyers, because it's usually the deposits that are the issue.

And in many areass of the country, very few first time buyers have ever paid stamp duty anyway, because most buy below £125k.

I have purchased two properties and not paid a penny in stamp duty as a first, or second time buyer, because both properties were under the stamp duty thresholds (£32k for a 2 bed terrace in 1995 and £109k for a 2 bed semi in 2006, which incidentally, isn't worth much more than that today so still likely to be under £125k).

Well it does help though. A lot of people are limited by the size of their deposits rather than their earnings. Not paying stamp duty will enable a lot of people to buy a more suitable house/buy a house sooner, especially if they are using help to buy. It's not a solution to the problem but for sone people it will be a great help.

It's ridiculous to say that removing the tax will increase prices .

It isn't a solution but it will assist some people to be able to afford to buy more quickly since that money can instead go towards their deposits.

ttbb help to buy is another idiotic scheme. Holds new build prices high and pumps money into (large only) homebuilding firms. I wonder how much donations such companies make to political parties.

newts it's not just random shit you know. The obr have stated this will probably help only a few thousand people and will increase prices by 0.3%. You are not one of these people who hate "experts" are you?

And I hope you never have to experience what you've just wished on an awful lot of other people - a massive market crash when they have mortgages on the higher amounts that will stay around their necks.

It's ridiculous to say that removing the tax will increase prices.

Why? If I don't have to spend £3k on stamp duty I can increase my deposit by that £3k and offer more on a property, hence prices increase.

And certain boomers who shit on about "I worked hard and didn't have an iphone and avacado toast" and the reason that young people can't afford housing can fuck right off. Please don't expect any sympathy from young people of all your assets are taken for your elderly care needs.

Tbf the people I heard moaning about the houses being told for care (which has been happening for decades any way if you go into a care home) has been younger people who won't get their inheritance.

Truth is some boomers were 'lucky' and some young people do overspend and so don't save.

rebecca oh yes madam I'm sorry. None homeowners should know there place shouldn't they? High house prices are brilliant aren't they!

High house prices are certainly not brilliant but there's no denying a massive crash would be horrific for many, many people. It's for that reason that I can't see what the solution is.

It's ridiculous to say that removing the tax will increase prices.

Why? If I don't have to spend £3k on stamp duty I can increase my deposit by that £3k and offer more on a property, hence prices increase.

Or you get to the stage where you have a deposit more quickly, buy the house sooner and thus spend less altogether in purchasing a property.
Unlikely that someone will say "oh I'll just save up for longer and then pay more for the property since I no longer have to pay stamp duty"

They sure are for me as I don't have a mortgage.

But unlike you, I wasn't thinking of me. I was thinking of hundreds of thousands of people who bought at market prices - you are actively wishing negative equity on them all. Doesn't say much for you, really.

I think it will increase prices a little so most benefit will be lost. Of course paying 5k (although I think prices will increase by more than this) over the terms of a mortgage is easier than 5k up front so it will help a few. However most people I know who paid 400-500k had help with deposit & stamp duty by parents.

Personally I think the market in a lot of London areas is struggling, it's in the governments interest to prop up the bottom as without the FTB's the process stalls. There is a glut of 2 bed new builds on the market, lots round 500k.

Even if it does work in the short term I think there will be some stagnation. People who are paying 500k now for a flat will have to rely on a combination of increased wages, paying off mortgage & some equity to move up to a house. However wages are stagnating, & some of these people may want to start a family & childcare is the cost of another mortgage. Plus what will interest rates be like in 5 years time?

My husband has exactly the same job as his father. In the 80s FIL bought a zone 2 London new build on just his salary. His wife was a SAHM.

It's the fault of those pesky feminists. When families only had one wage-earner then you could buy a house with one wage, now there are two incomes prices have risen accordingly. Let's go back to the 1950s.

These baby-boomer-bashing threads are ridiculous. We did the best we could in the situation we found ourselves in - just like you are doing now. What else can anyone do? Genuine question.

High house prices are certainly not brilliant but there's no denying a massive crash would be horrific for many, many people. It's for that reason that I can't see what the solution is

I agree that a massive crash would be bad for everyone. But maybe they should try to keep prices stagnant for a decade so that peoples earnings can catch up with house prices. That way no-one would be in negative equity and more people would be able to buy a home.

Best way to do this would be to build a lot lot more houses so that supply balances with demand.

It's the fault of those pesky feminists. When families only had one wage-earner then you could buy a house with one wage, now there are two incomes prices have risen accordingly. Let's go back to the 1950s.

Yes, horrible women wanting to look after themselves financially.

On a serious note though, it is difficult to buy a house now even on two wages. We earn £85k between us but still can't get a house. As rent eats up most of our income it is looking unlikely we'll be able to get enough of a deposit any time soon.

Best way to do this would be to build a lot lot more houses so that supply balances with demand

I agree, a crash would be bad & I don't think allowed to happen but the growth of the last 10 years can't continue. IMO high prices don't benefit many, unless you are happy to move & don't have kids. Most equity will be used to help kids pay inflated prices or fund social care. Of course some people don't have any equity to pass on.

I can't imagine there being a crash of significant enough proportion to bring the house prices back to 3 times average salary but even if it were to happen then the hardest hit wouldn't be the boomers anyway. They bought their houses in reasonable times and generally have small or no mortgage. They'd be affected by not realising their care home fees provoking the social care crisis.
The worst hit would be the people who've struggled to get on the housing ladder and have big mortgages as in high loan to value rates.

The obr have stated this will probably help only a few thousand people and will increase prices by 0.3%

At worst the measure should give first-time-buyers a slight boost at the expense of other buyers. If all the stamp duty savings are reflected in higher prices, so that on average there is no overall change in the cost of buying, just that some of the cost has shifted from stamp duty to the purchase price, then first-time buyers will be paying slightly less and other buyers slightly more, with the two amounts balancing out.

It's ridiculous to say that removing the tax will increase prices

It might increase prices in some circumstances. Where I live the majority of houses sell for £124,999 specifically because theyre 1st time buyer type properties and priced just under the tax point to make the most of those people looking to buy.

So currently a 3 bed semi thats been priced so first time buyers dont need to pay the tax will now start to go up in price possibly to £128,000 then once that price is accepted as normal then they will creep up even higher. I think in 18 months time my house will actually be worth more money than it has for the last 10 years. Its currently worth exactly the same as it was in 2004.

It's the fault of those pesky feminists. When families only had one wage-earner then you could buy a house with one wage, now there are two incomes prices have risen accordingly. Let's go back to the 1950s

A lot of house price growth is probably due to more women working and hence equally taking both salaries into account when taking out mortgages. House prices are probably strongly linked to how much people can borrow (obviously there is the inheritence and rich person with lots of money angle, particularly in London) but I've often wondered if it is necessarily a good thing to take both salaries into account when setting mortgage limits? It just makes things more expensive.

Doesn't necessarily need to be antifeminist. Women can still choose to work or not. But if lenders had continued to only take one salary, whether the man or the woman into account when lending mortgages, house prices might not have grown so much and we wouldn't have the afforability issues we have now. Would also help when incomes are reduced and/or costs rise when people start families, or in times of job loss.

After all, the situation where a couple both earn, neither takes parental leave, loses their job or otherwise loses their income throughout the term of a mortgage is probably quite rare. So by only linking the mortgage to one salary, there would be a lot more wriggle room and less struggling when the inevitable happens. And it would be fairer to single people too as they aren't competing against couples when buying properties.