To think there is a serious problem with the housing market in this country

[Kitchendisco21]

I was just about to buy my first home having spent 10 years saving a deposit. Thanks to the stupid help to buy intervention, the houses I was able to buy are now 50k more expensive so I am completely priced out. I am so utterly sick of it.

And no, I can’t move elsewhere/ get somewhere smaller/eat fewer avocados! I have been saving for a decade.

Aibu to be so fed up. I read last week that 98% of keyworkers couldn’t buy a home in the uk now. When will people actually wake up & see what a major problem there is? I am so angry.

sorry that's not going to happen. Why on earth would someone who is perfectly able to buy in their twenties with a 10% deposit not buy if they want to? Why would people stop giving money to their children to help them if they can?

To fix the problem identified on this thread, of course. To bring about a reduction in the price bubble, which benefits almost everyone.

Fear not, I answered your question before you even asked it, in my last post:

But it only works if a critical mass of people do it. You’ll always get the people who think that their children’s desire to own a house at 22 is more important than fixing a major problem that will affect their own children in the future, or people daft enough to think that rising house prices are a universal good (some even thinking that rising prices will help them to upsize...Christ).

@Iamthewombat

Although your points might solve the issue if everybody adhered to them as a collective measure, realistically people don’t think or act in the best interests of wider society - at least not until they’ve secured things in the best interests of themselves, & their families. It’s very honourable to think that we have high & noble intentions beyond our front doors but it’s human nature to quite literally keep your house in order before turning your attention to a wider responsibility.

Also this point you made; Don’t buy if you can’t afford a deposit. Surely, according to this logic if I’m saving for deposits for my children’s houses I’m a solution to the problem, not a part of it?

I’m leaving this thread now because I’ve won the debate @Iamthewombat

Only joking, I’m going to transfer some money into my children’s savings’ accounts so they CAN afford a deposit for a house..........you can thank me later

Also this point you made; Don’t buy if you can’t afford a deposit. Surely, according to this logic if I’m saving for deposits for my children’s houses I’m a solution to the problem, not a part of it?

No, you are not, I’m afraid. If you are relying on a wad of cash from mum & dad to fund a deposit, you can’t afford a deposit, can you?

The point is that asset prices adjust according to the amount of money available to buy them. If people could only pay for housing using their own earnings, then rices would have to come down. See? As soon as extra cash starts being injected - money from parents, looser lending by mortgage providers - the asset prices rise because there is more money chasing them.

At least you are honest about “I’m all right Jack”, eh? I have no skin in this game. You asked for a proposed solution and you got one. You don’t like it because it doesn’t suit you. It doesn’t mean that it is the wrong solution.

PRICES would have to come down, not rices. Although I suppose we might get a rice price bubble one day. Start stockpiling now!

@Iamthewombat

PRICES would have to come down, not rices. Although I suppose we might get a rice price bubble one day. Start stockpiling now!

Shhhhn ffs. You know how it ended up with loo rolls!

Isn't there some energy targets being introduced so it will make it even more difficult to sell your house and pay for these costly measures.

Perhaps right to buy purchasers should be taxed like capital gains. Responding to the greedy 180K to 900k figure

@woodhill

Perhaps right to buy purchasers should be taxed like capital gains. Responding to the greedy 180K to 900k figure

But it isn’t greedy. If the market price is £900k that’s what it is. Are those people expected to sell for less than market value? And why should some people be taxed on their primary residence and not others? Where do you draw the line?

But they were given a property at a discount so I think they should pay something in tax, say a difference in market value and purchase value at the time if they sold the property on. It's very unfair on others who had to buy at market price

To DynamoKev - your comment to 1dayatatime, which was "Your sweeping generalisations about "boomers" are "nasty, ill-informed discrimination" is spot on, echoes the comments I made, and unfortunately often typifies how some PPs on MN can be so bigoted.
To 1dayatatime - we are actually on the same page concerning the total unfairness of the housing market.
Regarding population growth, maybe only 2% of land is built on NOW, but that will not be the case if the population keeps increasing at its current rate.
The latest statistics I can find state that, other than micro states such as Monaco, Malta, San Marino, Vatican City, etc, England, (not the UK), is the most densely populated country in Europe after the Netherlands.
Your offer to pour the first concrete so that a further 2% of land can be built on, to ensure no child should live in poor quality insecure housing, is very noble, but insinuates that you care, but I and others don't, which is very disingenuous and patronising.
I care for example, that swathes of prime real estate in London is owned by rich overseas buyers from China, Russia, the Middle East, etc, some of whom have no intention of living there.
These properties are "investments", and have a knock-on, radiating effect outwards - a disaster for Londoners.
For the record, I don't need to justify myself, but I will anyway.....I do not vote Tory, I don't read the Daily Mail, have never owned a BTL, exercised a RTB, pulled any ladders up behind me, or objected to any housing development in my area.
Finally, and I don't need to announce this either because I really don't want to come across as sanctimonious, (but hate being accused of being a selfish "boomer"), I have a direct debit to Shelter.
How about you?

@Iamthewombat

Also this point you made; Don’t buy if you can’t afford a deposit. Surely, according to this logic if I’m saving for deposits for my children’s houses I’m a solution to the problem, not a part of it?

No, you are not, I’m afraid. If you are relying on a wad of cash from mum & dad to fund a deposit, you can’t afford a deposit, can you?

The point is that asset prices adjust according to the amount of money available to buy them. If people could only pay for housing using their own earnings, then rices would have to come down. See? As soon as extra cash starts being injected - money from parents, looser lending by mortgage providers - the asset prices rise because there is more money chasing them.

At least you are honest about “I’m all right Jack”, eh? I have no skin in this game. You asked for a proposed solution and you got one. You don’t like it because it doesn’t suit you. It doesn’t mean that it is the wrong solution.

This doesn’t even make any sense. If you have the money you can afford the property! Doesn’t matter where the money came from. Really weird view to have on things. If property prices fell by 50% then some would benefit and some would suffer same as if they rose by 50%, you are just changing which people benefit. The idea that lowering property prices is some sort of universal good with no downside is extremely naive

You’re not getting it. It’s about the supply of money to buy assets. More supply = higher prices.

if property prices fell by 50% then some would benefit and some would suffer

Who would suffer? It’s a genuine question. If you are living in a house and its value drops by 1% or 5% or 20%, how are you suffering? You are still living in it.

The idea that lowering property prices is some sort of universal good with no downside is extremely naive

Is it? What’s the downside? More people could afford to own a secure home if prices reduced. Anyone wishing to move would move to another house whose value had similarly reduced. You couldn’t smugly congratulate yourself on how much paper money your house had ‘made for you’, but that’s irrelevant anyway unless you plan to retire to a tent.

The thing I hate the most is the way mortgage lenders assess affordability. If you’ve been paying rent for years ( likely at a higher rate than your repayments would be) why is that not sufficient evidence that you can keep up your payments and are low risk to lend to? Seems dreadfully unfair in my opinion.

@woodhill

But they were given a property at a discount so I think they should pay something in tax, say a difference in market value and purchase value at the time if they sold the property on. It's very unfair on others who had to buy at market price

The reason they got a discount was a) because right to buy was a bribe to secure their votes and b) ostensibly to compensate for the rent they’d paid for decades. Anyone who’d been a council tenant for more than about 15 or 20 years had already essentially paid for the house anyway.

I bought privately around the height of right to buy and personally don’t give a shit about “unfairness”. There will always be winners and losers.

I pay more on rent that I would on a mortgage. But the bank won’t give me a mortgage

I couldn’t afford the rent on a house like the one I’m paying a mortgage on. It feels utterly ridiculous

I wonder what would happen if rents were controlled? Would BTL landlords sell up? That would bring prices down, if loads of former rentals came on the market.

Or would many tenants be happy to carry on renting, if it was cheaper and tenancies more secure?

I wouldn't have bothered buying if rents were cheaper and tenancies were secure, but I got sick of moving every couple of years. (Mind you, this was in the 1980s, I doubt I could have bought if I'd left it any later.)

@Angliski

The thing I hate the most is the way mortgage lenders assess affordability. If you’ve been paying rent for years ( likely at a higher rate than your repayments would be) why is that not sufficient evidence that you can keep up your payments and are low risk to lend to? Seems dreadfully unfair in my opinion.

Because it's not just about payments but also ability to take care of the asset. So repairs etc. If your roof gets fucked you are in for many thousands £. And anything can happen on market so they know the borrower can manage higher payments while still maintaining property. It's not cheap for them to repossess.

@Iamthewombat

I think you are missing some key things about how the market works house prices don’t exist in a vacuum, they are linked to other indicators of the economy. If prices fall drastically, something that else would happen in tandem that you would less thrilled about - high inflation, high unemployment, high interest rates. Result? Houses are still unaffordable for those that wished prices to fall.
Another thing, if prices fall and Howe owners fall into negative equity, that is bad. Why? Because it stalls the market, there are hundreds of thousands of jobs linked with the housing market - what happens to those people?
Essentially what you are advocating for is a kamikaze approach. Wilfull economic suicide so you can buy a house, but guess what? You won’t be able to anyway as result of that.
Wishing a drop in the housing market is no different to someone in financial hardship wishing everyone was poor, because in reality, they will be even poorer than they are today. The answer is increasing supply of housing stock above demand, very unlikely to happen. Or slightly above inflation rise in wages. The latter is so achievable yet so difficult - a whole new debate.

@Iamthewombat

You’re not getting it. It’s about the supply of money to buy assets. More supply = higher prices.

if property prices fell by 50% then some would benefit and some would suffer

Who would suffer? It’s a genuine question. If you are living in a house and its value drops by 1% or 5% or 20%, how are you suffering? You are still living in it.

The idea that lowering property prices is some sort of universal good with no downside is extremely naive

Is it? What’s the downside? More people could afford to own a secure home if prices reduced. Anyone wishing to move would move to another house whose value had similarly reduced. You couldn’t smugly congratulate yourself on how much paper money your house had ‘made for you’, but that’s irrelevant anyway unless you plan to retire to a tent.

Are you really asking this question? If house prices fell by 50% millions would be left in negative equity. People who have spent 25 years paying off a mortgage and maybe planning to downsize to fund retirement would be left with almost nothing. I can only assume you have a very limited grasp on reality of you can’t foresee these problems.

YANBU We need more housing and I get fed up of people blocking developments. We have a home, after a lot of issues, but I feel for those who don't. Increase the supply.

I think you are missing some key things about how the market works house prices don’t exist in a vacuum, they are linked to other indicators of the economy

I’m well aware of that, thank you. Where your argument falls down is this: are you seriously suggesting that the current house price bubble is a result of the economy roaring ahead?

No. It’s caused by too much money chasing limited assets, exacerbated at the moment by the stamp duty holiday. Of course house prices don’t exist in a vacuum but you can’t argue that high prices = successful economy and reducing prices = economic disaster.

Essentially what you are advocating for is a kamikaze approach. Wilfull economic suicide so you can buy a house, but guess what? You won’t be able to anyway as result of that. Wishing a drop in the housing market is no different to someone in financial hardship wishing everyone was poor, because in reality, they will be even poorer than they are today.

Oh dear. You are confusing me with somebody with skin in the game. I already own a house and I don’t care what it is worth.

Suggesting that it would be beneficial if prices adjusted to a level that more people could afford is not ‘economic suicide’ or ‘a kamikaze approach’. On the contrary. If less money is going into housing costs, more can be spent in other areas.

The answer is increasing supply of housing stock above demand

More housing stock is part of the answer, but only part. Better to break our national addiction to housing as an ‘investment’ by removing the factors driving price bubbles for a basic commodity.

Well you wouldn't would you - also - as you did this

Sorry - also - ignore my last post.

I still stand by my original comment though

It’s about getting a balance that works for those already on the ladder and those who are needed at the bottom that keep it from collapsing - to make it too difficult to get on serves no one esp as international money can disappear overnight.

But looking at London one bed flats of late on right move, prices def seem to have reduced. I look at them as the canary in the mine for the wider market as it is ftb that push everything along.

If house prices fell by 50% millions would be left in negative equity.

And they would still be living in their houses. Negative equity doesn’t get you evicted. Incidentally when did I say that I wanted prices to fall by 50%? Have you decided that?

People who have spent 25 years paying off a mortgage and maybe planning to downsize to fund retirement would be left with almost nothing.

Do you get that the houses such people would downsize to would also have reduced in price? In any event, relying on a house to fund retirement is pretty foolish. It’s not exactly a liquid asset and prices are subject to crashes. We’ve seen that happen at least twice in the past 30 years.

I can only assume you have a very limited grasp on reality of (sic) you can’t foresee these problems.

And predictably here come the insults. If you control your urge to be spiteful when somebody puts forward an argument you don’t like, you stand a better chance of being taken seriously.