To think people who own more than 3 properties should have a special tax applied to them?

[Calltheguards]

I'm just thinking with the housing crisis, should people really own more than 3 properties? I would assume it's a property portfolio and used to exploit renters. AIBU to think there should be a special tax applied to property owners who own more than 3 properties? Maybe tax them at a really high rate to discourage people from hoarding property.

And free up all those houses bought by rich foreigners and oligarchs that are left empty in cities. Hundreds of them in our city, left empty for nothing.

So you are even trying to say negative things about a £1 house ?

Really ?

HTTPS:www.bbc.co.uk/news/uk-england-stoke-staffordshire-4198171

@MissConductUS

The universities don’t all own their “halls”
some, if not most, are sublet.

serge your thesis appears to be that any reduction in house prices is a BAD thing, which I totally disagree with, and that landlords generate a lot of additional tax revenue. This is a reasonable argument but the amount you quote is around the same value as the housing benefit paid back to landlords by the government, so its all a bit pointless really. They could lose that income in exchange for not paying to house people and it would all work out quite nicely.

What about landlords of HMOs, some people neither need to, or can afford to rent or own an entire house, they just need a room. Students, temporary workers, people relocating, etc. This is a necessary service and viable business.

*Can one of the posters who wants all landlords to...well... stop being landlords.... tell me where the university students will live during term time?

Most universities here guarantee housing in university owned residence halls aka dormitories, but your point stands. There will always be demand for transitory housing and the price on it will rise until supply meets demand.*

Here in the U.K. university students aren’t even guaranteed accommodation in the first year! My DD was only guaranteed a place in halls if she qualified for her first choice uni (she did) if she’d had to go to a back up choice she would have had to join a waiting list for halls and look for private rental just in case. As it happens her rent in private accommodation for her 2nd and 3rd year’s was cheaper than her rent in halls!

@Family4F0rtunes I said it was great idea, but had issues. That's truth.
Your link doesn't work btw.
www.google.com/amp/s/amp.theguardian.com/tv-and-radio/2018/feb/22/1-pound-houses-britains-cheapest-street-tv-review

I do hope they will learn from the problems and run it again and in another cities. It's not safe to put few people into an empty area and hope for the best, they need to be provided some kind of security.

@M3lon Thanks for reading! I think that the key issue is that if BTL were regulated out of the market this happens uniformly, and thus suddenly, and would demand significant structural changes to the total economy triggering a structural recession. This would be made worse due to the huge multipliers in play within the economy by the type of non-elite landlords the OP was discussing, multipliers significantly larger an impact to the economy than those in benefit of housing.

Ultimately, I don't think house prices would come down in any real terms because there would be significant simultaneous impacts on credit, income and employment - as well as an environment of economic uncertainty, and people would be unlikely to sell for negative equity in that condition. Property would become a more unwieldy form of gold, in effect.

I rather suspect there are measures that would help with the housing market that wouldn't have such disastrous consequences, such as certain reforms to the mortgage industry or else more long-term renting schemes around the country (as is the case for the Netherlands, for example)

I would imagine ramping it up slowly...so banning people having more than 10 properties....then 9 then 8 etc. over the course of say 10 years. My feeling is that would allow things to adjust more gracefully.

What fucks me off more than anything is that fact that banks (via mortgages) get to set the value of houses at way higher than it should be, and then get paid for the privilege. If people refused to spunk up for 5 times their salary mortgages then houses would simply be worth less and bank would make less money.

Its possible I hate banks more than landlords.

So I feel like the banks keep the market bubble up regardless of anything anyone else does.

If no one can afford houses because the only people who could at the current place are Russian Oligarchs then the prices have to come down...unless the banks start offering 8x mortgages instead?

Why is it so very awful for houses prices to come down steadily over say 10 years? Again if people end up in massive negative equity then in the end they just declare bankrupt and the banks have to suck it up? (serves them right for 5x mortgages if you ask me....)

Why is it so very awful for houses prices to come down steadily over say 10 years? Again if people end up in massive negative equity then in the end they just declare bankrupt and the banks have to suck it up? (serves them right for 5x mortgages if you ask me....)

It won't be the rich who will "just" declare bankrupt. It would be people who can't afford extra payments. Also "just" declaring bankrupt is not as easy as you probably imagine. It's life changing and surprisingly not cheap.

Aah @M3lon come on, you can’t possibly believe that? Do you honestly believe banks set house prices? Nobody is made to take out 5 X salary, that’s an upper limit, set to allow people MORE choice in housing and INCREASE affordability. In what world could anyone possibly believe banks set house prices??? They charge a premium (interest) because they’ve provided you a service (lent you money).

I hope you never have to live in a country without a robust banking system or credit, you’ll soon find out that if there aren’t mortgages and banks available, most of the population can never afford to buy.

Yes YABU

yes nah - I don't buy any of that. What happens if nobody can take out more than 3x mortgage? People just live on the streets?

No. house prices come down. Offering fecking huge mortgages benefits nobody but the banks.

I mean are you really suggesting that house prices aren't affected by how much people can borrow to buy them?

bonkers.

Why is it so very awful for houses prices to come down steadily over say 10 years? Again if people end up in massive negative equity then in the end they just declare bankrupt and the banks have to suck it up? (serves them right for 5x mortgages if you ask me....)

Honestly your arguments baffle me. If people declare bankruptcy, their assets (homes) will obviously be repossessed, so they’ll be back to renting anyway? Which is apparently the scenario you wish to avoid?

Not just that, but if people went around declaring bankruptcy and defaulting on loans with no consequence, no one would ever risk lending money so all forms of credit would dry up. Making it harder for poorer people to buy homes, cars, start businesses etc. Why would you want that?

@M3lon If housing could be isolated with no impact on other parts of the economy, this might be workable, but it's inherently linked with the finance sector, with employment, with pensions, with investment etc. The UK has opted for a strategy where we engage in Keynesian strategies to avoid subprime investments (including mortgages) from resulting in a fiscal cliff. We, along with other major world economies, have determined that a restructuring of the economy would be disastrous, and that means that we cannot and will not allow banks to go bankrupt. We bought into this policy completely under the premiership of Gordon Brown, which makes it even more difficult to now go against that, it's unlikely we'd be able to - or want to. It's difficult to project the damage this would have on people: if we think social inequality is overwhelming now, imagine a complete destabilisation of the currencies of the UK, EU, US and China. We'd likely have to go back to the gold standard, and it would take generations to recover from. And all of this for a situation that wouldn't allow people to buy houses anyway? Because there would be a huge credit crunch, refusals to sell from banks/owners regardless of defaults, economic uncertainty, wage deflation -- it would mean that house prices wouldn't actually reduce in real terms.

And on the timing of this: if you introduce a quota that you reduce over the course of ten years, house prices wouldn't fall gradually. The very existence of a quota with this reduction being credible (this is the entire point of a quota) would almost immediately be reflected in the financial markets.

I'm not defending banks at all though. The solution here, I believe, is the introduction of proper punishments for bankers who engage in subprime investment strategies - including mortgages, properly. The potential of introducing 'rent control' on the growth of house valuations in line with inflation may be an option, however that would be a major turn away from the economic system we have subscribed to and would be a turn toward a very far left socialism.

I've seen some new build student accommodation, studio flat with ensures for sale on right move in various cities

Flat with ensuite

@Calltheguards there is a great discussion about various viewpoints corrently taking place on your thread but you dont seem to be involved. Why is that? What exactly was the point of you starting this thread if you wont engage in discussion?

ahh fecking pensions. That's all going to collapse anyway isn't it?

The exponential growth or we all die a horrible death model of economics has a major flaw what with exponential growth not being a plausible long term outcome.

I feel like what you are telling me is that we are on a runaway train and we can't get off without it crashing...but its going to crash at some point anyway.

Everything one could do will either fall to impact the train, or worse it WILL impact the train and then everyone dies.

Is the future really this bleak? Is there literally no way to rein in the bloody banks? When did we pass the point of no return?

Yes I agree

I also agree with tax being paid on the whole of the rent not just the mortgage free part of the rent

And I am a landlady I may earn very little month to month but as the price increases it’s far better than any savings account would ever return to me

The buy to let boom totally changed the housing market it was ridiculous how easy it was to make money and pay so little tax it needs to be turned around

www.bbc.co.uk/news/uk-england-stoke-staffordshire-4198171

serge my previous post was to you.

yes the thing is that things don't cost more than people can pay for them. So if nobody can afford a house at price X then houses stop costing X. If banks suddenly own a huge number of houses they can't sell for X will they just leave them empty hoping against hope for the day when people can spontaneously afford them again, or do they sell them for X/2?

It reminds me of the spaceship stuck waiting for a new civilization to arise that will produce the lemon soaked paper napkins they need...

M3lon, I think you’re confusing 2 arguments:

• Are house prices set by willingness to pay? Yes. Ie if there’s only one house available, it will go to the buyer willing to pay the most, and that will set the price. This is correct.

• do mortgages artificially inflate willingness to pay? They definitely make housing a more liquid asset, because you know when you come to sell buyers might easily get mortgages as well. But they don’t increase the amount you’re willing to pay, surely? If all the 3 bed semis in your area are selling for 200K, but you can afford a £300K mortgage, you’re not going to offer £300k unless you’re daft. Even if you did offer it, the bank would consider the valuation of the property and you’re mortgage wouldn’t be approved

Apologies link not working, you can find the good £1 house stories on google