to believe MPs will never curb BTL because so many of them own more than two home and stand to seriously lose if house prices go down/values become more affordable

[Lemonsmakelemonade]

This on the Guardian. Often wonder why more people are not worried about ridiculous house prices. It's a not a supply issue - there are thousands and thousands of empty homes in London, it's cheap borrowing that has encouraged house prices up... and MPs will never do anything about it.. www.theguardian.com/society/2018/jun/25/home-ownership-out-of-reach-for-2-million-uk-families-says-thinktank

The empty houses in London make up a tiny percentage of the entire total, and are usually foreign owned, bought with cash.

Whilst its true that schemes like help to buy have driven prices up in places like London, the biggest thing driving house prices is under supply.

For nearly 40 years the private sector have been under building by about 150-200,000 needed dwellings a year. This drives up the price of new builds which suits them down to the ground.

When you look at the failure of the housing market there are several different causes, but the under building is the major one. For example the ONS calculated that out of the last 23 years, immigration had increased house prices by 20%, but during this period house prices had risen 320%. So immigration added 0.86% PA to the price of an average house but 13.04% was from somewhere else, the significant part of this is under supply.

If under supply is such an issue why have some people been able to buy two/three houses - with their pension freedom money and people are not walking the streets homeless.
I think this has been talked up - the under supply issue that is. It also fuels the immigration as a bad thing for the UK line. Cheap borrowing has driven up house prices. There is also the issue of the ageing population which means people cant move up the ladder to upsize. But the idea there are not enough houses for us in the UK - rubbish.

"If under supply is such an issue why have some people been able to buy two/three houses - with their pension freedom money and people are not walking the streets homeless."

That's a wealth differential not one to do with supply. Homelessness usually isn't due to the lack of a home for a person to stay in.

"Cheap borrowing has driven up house prices. "

Which I acknowledged, but under building is the most chronic problem.

Haribos - which is why the under supply everyone talks up is a load of rubbish.
MPs- have made money by buying 2/3 homes in the SE. However I understand from recent reports that more people are heading away from the South East - I can never understand why anyone would choose to live here. I was born in London and my family live here (well near here - as we had to move out to the Herts/Essex border) With children I wanted to be near my family. We are looking at other parts of the UK as DH might be relocated...

and people are not walking the streets homeless.

Whilst I agree that under supply is not the main problem here, I have to point out that homelessness is a huge issue.

www.theguardian.com/society/2018/jan/25/rough-sleeper-numbers-in-england-rise-for-seventh-year-running

But that's a much more complex issue, unaffordable rents, cuts in mental health services, insecure employment are all factors.

I actually think that, when the government quote stats on how well the economy is doing they should include homelessness and food bank usage. Puts a very different light on things.

Bombardier so true! The only reason people think they are wealthier in the SE is because the price of their house has gone up. Fact is most of us are not as well off as we would like to think and that goes for society as a whole!

They've already cut the tax break on BTL mortgages. I agree, I think its a wealth differential problem not a housing problem as such.

I think undersupply is an issue in some parts of the SE as well but its also a problem of house builders only building a very narrow type of house. eg 1 or 2 bed is always a flat in big blocks, often to meet the requirement for 'affordable housing'. 3 or 4 bed is always a townhouse over 3 floors with 3 toilets and a tiny postage stamp garden, opening out onto the road or narrow pavement at the front. When we have an ageing population why is no one building bungalows or houses adapted for disabled people? I know that one. The developers make less profit on them. But why aren't they made to build a greater variety of housing?? I know that too - local councils have to meet their housing target so they don't actually have that much influence over the developers as ultimately they need them to build.

" which is why the under supply everyone talks up is a load of rubbish."

It isn't.

More than 62.9 % of households are owner occupiers.

About 4 million households are in social and council housing this means another 14.7% of households.

So altogether 77.6% of households are either owner occupiers or in social housing. Only 23.4% of households are privately rented.

Under supply is the main determinent of house prices and the reason why the housing market has failed, especially due to the under building of affordable rental properties and social housing since the 1980s.

MPs are, iirc, quite a bit more likely than the general population to own a BTL property, so you're right about them having a disincentive to do anything to slaughter the cash cow. But then they don't all, and maybe some of them who do will be willing to act against their own financial interests, who knows?

I'd also disagree that prices are only ludicrous outside the south east. There are lots of areas in the country where you can get a family house with change from 100k but they're still unaffordable multiples of local median income. Now if you can do as I have and live in a cheap area where you're on more than the local median, you're laughing, but by definition everyone can't do that. There are also areas outside the south east where there are issues with affordable rental properties: I'm in Manchester and it's a big issue here.

I don't think that prices are only ludicrous in the S.E .

But its the under building of housing that causes the high prices, its the largest determinant of price. Why else do you think the big 4 commercial builders sit on 600,000 properties with planning permission yet build on less than a third of that per year.

The crisis in which we currently find ourselves has a number of causative factors, many of which predate BTL, and took a couple of decades to develop. One should no more suggest this is all down to BTL than one should claim that BTL is entirely responsible.

There was a thread on here recently where someone asked ‘what would you do if you inherited 100k?’ About half the posters were saying they’d pay off the mortgage. a large proportion were recommending not paying off the mortgage, as interest rates are generally low, but buying BTL properties instead.

My guess is that BTL will continue to grow as long as BTL mortgages are still available and make financial sense to borrowers. Financial institutions will continue to offer BTL mortgages as long as UK property appears to be a sound financial investment.

There is still a general impression out there that investing in property is better than investing in other equities. With the decline in ‘decent’ employer pension schemes many people are buying property as ‘pension investment’ rather than risking the volatility of private pensions.