To think no one has a right to make money off their house

[Laughingstock1991]

The general consensus among financial commentators this week has been that the housing market has turned. Interest rates are still going up and are unlikely to come down for a few years. The low interest rate financial experiment that has been in place since 2008 has ended and it’s unwinding is going to be painful. The housing boom was based on cheap credit.

My mortgage is likely to go up about 400 a month. Lots of commentators reckon we are in for a big fall in house prices. Good thread here:
https://twitter.com/EdConwaySky/status/1668987423643119623

What pisses me off is the absolute assumption made by some people (like my friend today) that the government should use public money to bail out mortgage holders. Most people were stress tested on their mortgage- I was- and yes it’s going to be tough but do I think public Money (renters money) should be used to bail out mortgage holders- fuck no! The Lib Dems have raised this also today.

House equity is unearned wealth. There are no guarantees. We have been through a boom and now it’s going bust. Hopefully sanity will return & housing will be seen as a home again- not an investment. Its not a ‘market’.

And I say all of this as a homeowner who is going to have to pay a lot more. I want everyone to be able to afford a decent home- not just those with money.

I don’t think that’s unreasonable!

So (entirely made up numbers) if I buy my house for say £250k, mortgage for £200k, house prices go up after 15 years and I can sell for £350k, pay off my mortgage, move to a smaller house and live mortgage free am I not allowed to do it because I didn’t “earn it”? I’m not sure I understand…?! Am I meant to give that to someone?

@65Gritch And if you're still not happy with house prices and living amongst an open market go and build yourself a mud hut

But we aren’t living in a free market. Help to buy isn’t a free market. Furlough wasn’t s free market. It’s government interventions!

You're advocating for a huge proportion of the population to default on their mortgages and potentially become homeless on the grounds that unearned wealth is inequitable and you don't think its a great reset 😂.

I'm out and off to talk to the grown ups.

'Its making sure society can house its population in safe secure affordable housing.'
You would think that this would be a priority for the government in any civilised society that expects to be respected on the world stage. Sadly not.

Nope - it’s about supply. We don’t have enough homes . To rent or buy. There are huge restrictions on building and targets are never met. More homes equals more people able to afford them as the demand is satisfied. Prices stabilize. For renters and buyers. Yes, supply of money matters and some people will never earn enough but more homes being built would help a lot. However building houses costs money. It’s an investment. Housing associations have to borrow money and can be reluctant.

@Recoveringcynic i’m not advocating for it. It’s already happening.

I haven't read through all the posts. One thing that saddens me (in addition to people struggling with their bills) is that the crash may make it a lot worse for people to get on the housing market - it sounds counterintuitive but builders build less houses when markets crash and less houses with such high demand will keep prices too high for many people over the medium term.

OP, you're incredibly naive and simplifying an incredibly complex situation. You claim to care about people but obviously don't, otherwise you wouldn't be suggesting something so ludicrous.

I agree sincerely with the original post.

My main beef is that it is so much harder on single people! Couples can more or less live in the same physical space (if no kids) as single people, so you are only shelling out half the amount a single person does!

The only advantage is if you are bidding on a studio or (possibly) one-room apartment, as then there is less competition. The same applies to hotel rooms, grrrr!

What's all this rambling about 'equity'?
Our welfare policies are generous enough that the government pays people's rents, and/or finds them somewhere to live.
If a lot of people suddenly lose their homes the government will have to pay out anyway.

Basically, you want Housing Benefit to go into a landlord pockets instead of into people's own homes?

Banks also tighten their lending criteria, making it much harder for first time buyers, even if prices are lower. The problem is people think house price crashes exist in a vacuum, and that the result will be that far more people are able to buy a house, but sadly that isn’t true.

No it's not and definitely not across the board.

EA's and other housing 'experts' have been predicting a crash for the last 20 years.

I lived in a tent with my toddler during the Blair Govt; causing division along party political lines is futile and counter-productive.

The current housing situation is a National Emergency and above party politics; playing the blame game is useless and a waste of energy

My husband lost a house and a flat in the 90s recession .
he was lucky that back then he and his wife were given a lovely HA house within weeks and when they split up a few years later my DH got a 3 bed council house as he had his kids which he then managed to buy several years later.

The house was in an area that until the last 10 years no one really wanted to live there always had a bad rep of inner city
But it’s suddenly got popular with students and has become quite trendy 😂

He met me and I already had a council house as I was a single mum and I also bought mine under the RTB from a small inheritance from my grandparents

Fast forward years later I don’t have a mortgage and we live still line in my house and his place is rented out and has been for years .

Was that the wrong thing to do . Probably but legally neither of us did anything wrong and I don’t regret it
even if we are part of the problem that there isn’t much social housing around anymore

But I think what they will do if people cannot afford the mortgages banks will encourage interest only and longer terms
Rishi will probably try and come up with some stupid scheme like “eat less to buy a house “

The government will not help people to stay in there homes
years ago they used to pay the interest on mortgages if you needed help
now I think they still do it but only after 9 months and i I think it’s as some sort of a charge to be paid back out of the estate
And you have have claimed UC for the whole 9 months period from what I can remember reading
if you start work for a few weeks and then reclaim UC the 9 month wait starts again

They couldn’t give a shit
instead they will encourage the banks to get people on interest only and extend the terms

Erm how about people that put a lot of money into improving and changing their homes? Equity isn’t just an increase in sale value it’s also down to people investing and spending money.

I guess it depends if you mean spending money on neccessary things like ensuring the roof doesn't leak, rewiring, structural stuff etc
Or are you are talking about 'adding value' as the person who lives there, so spending more on a bathroom/kitchen beyond what is required for it to be functional because you like it and it makes you happy ?.
You then hope because you have made the property you chose to buy liveable and lovely someone else see's that added value and pays a bit more than you did ?
That's a tricky one really, the structural stuff is very important and should mean you get something back, the frippery is more problematic because trends change quickly and its also down to very personal tastes. If you decide to spend 25k on a kitchen that you could have spent 6k on, don't expect a 25k increase in the price of your property.

I agree however we already have a rental housing shortage so whilst negative equity won’t do that we are in trouble if houses start been repossessed . We don’t have the social housing we did in the 80’s

@SamanthaCaine i’m sorry, what? I refer back to my OP- why should mortgage holders get a bail out from the tax payer? What’s naive about that?

The point is, it's not unearned equity is it? Actually it's probably just wort exactly what I paid if you include interest rates. Not sure why people don't seem to grasp that? Unless you paid cash you never actually just pay the value of the house you offered on.

It’s amazing the posters piling in and screaming ‘great reset’ etc at me.

Again, why should mortgage holders get a bail out from the taxpayer while people who rent have to put up with massive rent increases? 65% or a section 21 was mentioned on here.

Its morally wrong.

I bought a house and ive got approx 100k equity in it now. ALL my money is in my house. Have i earnt it? yes. deserve it. also yes

I waited years to buy a house and i am proud of the fact i worked bloody hard to get it

What annoys me is those renting/counil who get the majority paid for them and then get the right to buy!

And "they're not listening now, I doubt they ever will"

Sad but true.

You've clearly got a big chip.

You're naive because this situation is far more complex than your posts give credit for. It's in the interests of any government to help people in imminent danger of homelessness, because it will cost the government more in a myriad of other ways. Then there's the impact on industry connected to those affected.

Then there's the naivety of thinking you even have a say on what the government does with our taxes.

@carly2803 What annoys me is those renting/counil who get the majority paid for them and then get the right to buy

You really need to get your facts straight before making comments like that. What utter offensive bollocks.

@SamanthaCaine the government don’t give a flying fuck about people in rented housing - many of whom have to absorb massive rent increase all the time & get no help. I don’t see them helping renters in imminent risk of homelessness.

Why does OP think mortgage holders are a seperate group from taxpayers?

And why doesn't OP understand that mass homelessness would also be an expense to the taxpayers?