To think being able to use housing benefits as a mortgage is unfair?

[blahloney]

I’m actually feeling quite annoyed. I currently work full time, don’t receive benefits but cannot afford to buy a house despite my rent being more than a mortgage. How is this fair?

Was he on benefits if so you would’ve been able to apply straight to the council to have the money paid into your account after two months of arrears. I actually prefer universal credit Tenants for entirely that reason.

@Grumpybutfunny
No. Help to buy ISAs will not be exempt.

The 16k savings ceiling is dependent on various criteria such as age and benefits. I have a ceiling of 21180 as my pension was deferred without asking me so the lump sum
I received is disregarded for life and tax free. Most DWP errors are only disregarded for 12 months.
Read it up on the Government website. The CAB was very in the ball when I asked for clarification as the DWP were going to reduce my pension, in fact they did for 2 weeks, then reinstated it plus the deductions refunded.

I personally think it would behove local authorities to allow certain people on benefits to buy instead of rent. The LHA for a 1 bed flat in my area is £1,050pm, far higher than any mortgage.

Ffs yes they will.

Speaking in Blackpool, the Prime Minister said: "We're going to look to change the rules on welfare, so 1.5 million working people who are in receipt of housing benefits, I stress working people, and want to buy their first home will be given a new choice: to spend their benefit on rent as now, or put it towards a first ever mortgage.

Doing so removes a significant barrier that currently prevents hundreds of thousands of families from buying their own home."

"To remove another [barrier], we're going to explore discounting Lifetime and Help to Buy ISA savings from Universal Credit eligibility rules.

"It doesn't mean letting anyone who claims benefits whilst sitting on a vast pension pot that they could be drawing on - that's not the people we're targeting.

"But making it easier for hard-working people to put away a little every month until they have enough for a deposit on their first home."

Until now, people haven't been eligible for benefits if they have savings above £16,000.

This is the policy I wish the government would adopt. It's been suggested by various think-tanks over the last few years, but of course it doesn't benefit property developers, so the government doesn't seem to be interested. Make it beneficial for landlords to sell to tenants by knocking off the (frankly astronomical) capital gains tax they face when selling.
www.taxjournal.com/articles/cgt-incentives-landlords-selling-long-term-tenants-10102018

@LoisLane66 sorry, should have said we're not in UK.

She has a partner, he works. She also gets free medical, fuel allowance, school uniforms.

I don't begrudge her, it's just not fair.

Im beginning to think this has been deliberately engineered to stoke hatred towards social housing tenants as we approach the fifth anniversary of Grenfell

The other thing with more home ownership
less housing benefit needed when generation rent retire
anx something to pay for care.
currently that’s going to be an astronomical can being kicked down the road

We rent privately, we are on the housing list but a long way down. Our rent is just about affordable, we will never be able to save a deposit ... so; no housing assocation housing or mortgage for us. We are stick in a private rental with no hope of moving forward, perhaps its time to look at private rents in mortgage applications - 12 years of payments and never late with any of them but no mortgage because we can't get a deposit together, it hardly seems fair!

But that’s what they do, like there’s literally no solution to these problems none.

we need the land to farm to feed ourselves and we don’t have enough houses to house ourselves.
it’s a complete and utter disaster So kicking the problem up the road is literally the only option

i hear you. We’ve paid out nearly £250,000 in rent. yet can’t borrow enough for a home

Us too, I don't even understand why people in se use tenancies need to be able to buy their homes, let alone st a discount. Its private renters who have no security, regulation or hope of bettering their situation 😭

There are solutions but one way or another someone will always lose. You just have to work out whose need is greater (or which donor / vote counts more).
there are alternatives to building on farm land and greenbelt and I say that as someone who actively defends the countryside and wildlife.
you can build in a way that benefits communities and wildlife, there’s less profit in it though.

Completely, they have the holey grail of tenancies as far as private renters are concerned.

I'm old enough to remember when this was possible. Then Maggie stopped it, so people had to move out of houses they were buying into rented accommodation, even if the rent was more than the mortgage.

In some cases people literally moved next door.

Who bought the houses that flooded the market? Buy to let landlords. Who then put rents up far higher than the initial rent.

So HB (and obviously tax payers) used to pay a mortgage for people who had lost their jobs, single parents, people who had to give up work due to disability or illness and allow them to stay in their own home.

Most people are not on benefits for life unless it is for disability / ill health.

Now it is paid to the landlords instead.

So as a taxpayer where do you prefer your tax to go?

Given that various governments have had literally decades to prepare for the biggest ageing population of all time and have done nothing, I don’t know why you’d expect anything else.

That’s where the reduction in deposit comes in - if happens

Although earlier on as pp said you could get 110% even but 2008 made it all harder

Tough one as it’s a shame people can’t buy just due to deposit but also was riskier

A HA (or council) tenant will not need savings for a deposit (as many PP have already said). However, if you've never bought a house before, it's easy to not realise the other costs involved that will require savings, and can cost a few thousand.
Obviously, as they already live there, they won't need to pay for moving costs. However, solicitor fees will still need to be paid. if people don't consider this beforehand, I see them getting out loans to cover the excess costs. Also, things like home surveys; I assume the banks lending will still want these?
Also, what is the situation with stamp duty? Yes, first-time buyers get some relief on this (a lower amount etc), but if the (full) value of the home exceeds the threshold, this will still need to be paid, and could be in the thousands. Is this scheme intending HA and council tenants to be exempt? (I don't know what the current situation is with council tenants who are able to buy, I assume the same rules will apply to the HA tenants now?)

Us too, I don't even understand why people in se use tenancies need to be able to buy their homes, let alone st a discount. Its private renters who have no security, regulation or hope of bettering their situation

Absolutely.

1/ we shouldn't be taking the secure tenancies of HA and council homes out of circulation, there aren't enough of these to start with.

2/ these people have incredibly secure tenancies and therefore don't need to buy.

3/ we need to make private rentals more secure - I'm all for rent caps and more secure tenancies and if that makes some landlords sell up, so be it. It will mean more homes for owner occupiers to buy.

4/ I suspect this is all a wheeze to get traditionally Labour voters to vote Tory.

I doubt lenders will want more than the most basic survey because of the relatively low LTV. Equally stamp duty for FTBs doesn’t apply under £300k, presumably this is only likely to be an issue in very expensive parts of the country.

Regardless, it’s a really shit idea to perpetuate a policy that caused the current housing crisis in the first place. Good thing it’s never going to happen.

I think the deposit is to prevent people from walking from a home and also to ensure that the bank will be able to cover the cost of the property if the person can't pay. Forced sales often mean that the property sells for less than what it is valued in the first place

I don't think the issue is the 10% deposit required for many FTB properties. The issue is house prices are very high in relation to earnings and there is huge inequality in earnings and wealth..people are using their houses as bank accounts... So a FTB is often competing with someone with 200k in savings sitting in a bank account....i don't think they should be allowed to compete in the same market but they often are. I bought my flat from an ex landlord who purchased my property in cash. I was lucky that the yields in London were low at the time and the government imposed more taxes on landlord. If a lot of landlords were buying in London at that time (they seem to be buying in the region's), I would have had no chance...

This is it. We have a decent deposit it’s the mortgage to wage bit we can’t qualify for.

@EvilPea Well you should benefit massively then from the fact that you are going to be able to pay your mortgage with universal credits that will be included in the affordability calculations and basically gives you a least £600 a month extra purchasing power that you didn’t have before

I don’t get universal credit