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!

Although I agree with your sentiment OP, actually it is the right thing for governments to bail out mass economic crises like this to avoid an event greater one - just like in 2008

We put our house on the market in 1990 start of the crash for £115k . Seven years later it sold for 84k. But everyone lost money on houses so it all evened out.

FWIW I would have zero issue with the government intervening in some way (potentially through the banks as opposed to cash hand-outs) to ensure you stayed in your home.

The alternative for some is completely counter productive and would cost more than any measures introduced to help.

I think anyone who has spent evenings and weekends renovating would feel they’ve earned it. I am not at all handy and climbing by ladders in heavy duty dust masks ripping lathe and plaster walls off , slicing and inserting insulation, freezing my hands off painting picture rails outside in winter sure felt like work. I know that’s not your main point but it is covered in the title of your thread! We are in the next house now and I am spending hours mapping out garden plans, picking up cheap plants where I can, digging and weeding and reading how to care for my plants. The garden will probably add value and that will be earned too. Yes it’s a privilege to be able to buy a house you can improve, but that doesn’t change the fact the improvements are due to hard work.

Housing is a massive issue in this country. There are no longer many social houses left, so if your made homeless I don’t know where you’ll go.
And many people can’t afford to buy. Whilst they are working they can afford to privately rent but what happens when they retire and can’t afford to privately rent ?

Were going to have a generation of people that couldn’t buy their own home and won’t have anywhere to live once they’ve stopped working.

Is the government thinking 30 years ahead ?..

Well naturally it depends doesn't it? I've rented before with no intention or desire to buy. Not all renter's want to buy.

The luxury you're referring to accounts for a small percentage of society, by virtue of about 65-70% of the UK being homeowners already.

About 15% of the UK are in social housing and the other 15% renting privately. When you account for those who will never be destined to buy, you're not left with much. And let's not confuse those who dream of owning with feasibility of owning.

As someone in the generation who can’t afford to buy due to the ridiculous house prices now, no absolutely not. Those of us who rent have to move if our rent is raised, why should we be bailing out home owners who have the option to sell and downsize?

It is crazy, but is it those people’s fault? I don’t think mortgage owners set the terms of their mortgage nor the fact that’s it’s cheaper to own than rent? The problem with renting prices are greedy landlords renting out their property for crazy prices and banks not loaning money to first time buyers despite repayments being cheaper than their current rent and them having a stable position.

How is people losing their home going to change the rental situation? Most homes that will be repossessed will be sold (as banks tend to avoid renting them out due to risk of people not paying). they will likely sell them at a slightly lower price than market value (but not affordable to most people stuck into rentals, which like you say can’t afford to save) to avoid them being squatted & they will likely be bought by people who have the cash ready and therefore likely already own other properties are financially comfortable.

To give you an example. I am mortgage-free, I am therefore unaffected by mortgage/interest rates, so while people are struggling to pay their repayments/rent, my ability to save will (likely) remain unchanged, which then further gives me the edge to buy more properties if I desire while people will be losing theirs. So now if I did just that & bought a second property from one of those families that has just been repossessed because they couldn’t afford their repayment on their first home they worked all their life to afford and decide to use it as a holiday home and keep it off the market? Who does that benefit? Or if I decide to rent it out at an average but high price (to that same family that was just evicted from it, or others,) how does that better the market? Doesn’t it make richer people’s richer and keep everybody else at the very bottom and still far away from being able to own?

I personally would much rather see people keep their home, than see people who are already comfortable and have benefited from the housing market, further benefit from it and people’s desperation. This whole “if renters struggle, home owners should too” is weird. Comfortable home owners, & mortgage-free people won’t struggle (or not enough to impact them in the way it would everybody else). Some
of them are even likely to benefit from it all. Only those who are in that uncomfortable in-between will struggle and those who are already struggling, and I can’t see how people losing their home will help the market in any way nor will lead to better more affordable housing for all, when those properties are more likely to end up in the portfolio of foreign investors or greedy landlords who have no interest in affordable housing and would happily keep a flat empty as they wait for the property to raise in value still.

I think if the goal is for everyone to have a roof over their head and decent affordable housing then keeping people into their home (that are affordable vs rent prices) should be one of the priorities. Followed closely by putting pressure on banks to be more keen to loan money to families who have a good track record of paying their rent on time and have a stable situation and for whom repayments would be a lot lower than renting.

I think the onus should be on helping people buy rather than forcing more people onto the streets or the rental market, where all money go to people who already have money and benefit from the current situation of the housing market tbh.

Same here we lost every bit of equity and more on our first house abroad when the market dropped and came back to the Uk with nothing. the issue now is that prices are massive and people stand to lose so much more, although I don't personally think prices will drop as much as some people anticipate.

Interest rates should never have gone so low. It was unfair to savers and fuelled house price inflation.

What the gov should be doing is not allowing people to own more than one property whilst the country is in a housing crisis. I don’t begrudge people wanting to hold on to their homes, but having multiple properties to profit from being a landlord and price gouging rents and also reducing housing inventory making life more expensive for everyone else shouldn’t be socially acceptable. Have one house and that’s it.

Well isn't this fucking great - all discussion and debate is narrowed down to arguments between renters and home-owners whilst ignoring the fucking great elephant in the room.

I'm off to eat some food - hopefully by tomorrow , the two distinct sides to this debate will have come to their senses and realized it's all mightily shit for many people.

And get together to shift that fat-assed giant elephant out of the room.

@Tophy124 i agree- BTL and second home ownership should be regulated through hefty taxation but you’ll get people coming along and screaming about that too!

If mortgage holders started becoming homeless on mass there would be massive pressure on the already inadequate social housing.
It would be in the governments interest to keep these families in the homes.
I'm assuming any help given would just be towards some of the interest of the payment not on the capital or even all of the interest and as the demographic are mostly people that pay in to the system yet very rarely claim much back, If it means families wont be out on the streets then I'm all for it.

Well what us renters and home owners alike should be fighting for, is people not being allowed to own more than one property. It serves only the rush and makes rent and house prices more expensive, along with shoving a lot of locals out of where they grew up due to second holiday homes.

Absolutely. this government have got it so so wrong encouraging buy to let mortgages which has contributed to rising house prices and rising rental cost which this government then have to partly pay for through UC and housing benefit. It's all so short sighted. The rich just getting richer, it's disgusting.

I totally understand what your saying. I do wish we could get some help though. After years of both my husband and myself working every hour under the sun, we are now left thousands in arrears due to me being diagnosed with a very rare terminal illness and my husband becoming my full time carer and even though we paid extra on top of our mortgage every month for tmpp, they wouldn't pay out, so we are losing our home,and my husband and children will be losing their wife and mother. It's honestly an awful situation, wouldn't wish it on anyone

I completely agree, it’ll never happen though.

I'm really sorry to read this. have you looked into support for mortgage interest if you are claiming means tested benefits? I hope you are getting all the help you are eligible for.

Thank you. Yes we have just received the forms, but my goodness they are a lot. It's hard going while getting treatment etc. But we are working our way through them slowly. Thank you for your reply

Not screaming but this is already happening.

The trouble with this view is that accidental landlords or owners with two houses were never the problem. It's 100% misplaced to not know this.

What the government has done is to squeeze these owners out of the market but have not touched (but encouraged) landlords with huge portfolios to flourish. People like Tony/Cherie Blair and others who are already 'next level ' wealthy who are only getting richer, vacuuming up homes that accidental landlords are selling up.

Do you think Tony and Cherie Blair are keeping their rents low to help people or charging exorbitant amounts and then offshoring profits so we never benefit as a country?

And if there's a crash, who do you think will have the liquidity to buy up any repossessions or anything that goes on the market? It's unlikely to be the people you think should benefit.

And yes that would be a good start Tophy, I agree - having a 'colonialistic' second home in the terraced house next to mine. Arseholes they are.

And I do specifically call it 'colonialization' now, rather than 'gentrification' because that's too polite. Because having a UK 2nd home is colonialism and certainly involves treating the indigineous population like shite.

And I don't give a shit if using such extreme terminology upsets the 2nd Homers and their 'play houses' - you're helping nobody but yourselves on the backs of other people's misery.

What about the interim where rent prices continue to skyrocket as homeowners try to cover the mortgage increase?

I think your viewpoint on this depends on your age and life experience.

My earliest childhood memories are moving to a new home that I now know was completely affordable for my parents (late 1970s, dad working, SAHM). It was amazing.

Then all of a sudden, 1980, it wasn’t affordable. My Dad did his day job and his night job. He worked 19 hours a day. Us kids got out of bed, and put in the one car we could afford because we had to pick him up at midnight. My mum then worked 12 hours stocking shelves through the night at weekend so they didn’t lose the house.

It settled again until 1987, when mortgage interest rates were 15%. I can remember my parents’ worried faces and it has had a lasting impact. They decided to move to a smaller, cheaper house to avoid the stress.

I/we have never over extended ourselves and live quite modestly according to our means because I have always done the sums and not assumed that everything will always be rosy. Because it it never is.

So no, I don’t see why the money I pay in tax for public services should be spent on helping people with mortgages they might not be able to afford in the longer term. It pays for healthcare, education and the social
care we might all need one day.

I pay tax for the public services that people often complain about. I think they will get much worse if we have to pay mortgages that people take without an eye on the medium or long term view.

I want there to be public money for people who aren’t fortunate. I’m happier to live smaller and pay more so there is more
money for those who need help.

House prices are an aligned issue but also a separate argument. People wanting everything and being unwilling to sacrifice anything is another.

I see a lot of people living beyond their means and find it quite worrying. I’m much older than the most of Mumsnet so maybe that makes as difference?

Private landlords came to the fore to house people!!! Why is that so difficult to understand? There wasn’t enough ciuncil housing! It simply was not built in sufficient quantity. This thread is just post after post of bile and a woeful misunderstanding of the housing situation. .We have not built enough homes!!!! Council homes were sold off . They were not replaced! Private landlords have filled the gap. Many will sell up as the issues with legislation start to bite. So higher rentals will ensue as demand will not go down.