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!

😆

No one has the right to house equity? But without the equity from rising prices, nobody would be able to afford to move!
This.

A home is a home first, but also a long term investment, be it, now it seems to pay for any care i may need in old age.

That's the Singapore model. It's not communist. It's not 100%, it's 85% of the population. Technically it's ownership as it's a lifetime lease basically and you can sell it (and move to a private condo if you wish which many people who eventually become millionaires do- using the state subsidized home as a starter home). You can also renovate as you wish and you would be mortgage free at retirement age. Singapore has 90% home ownership as a result. It has widespread support, even my dad who lives in private housing keeps telling me I should buy a government flat in Singapore even though I already own a flat in London as it's my entitlement as a citizen. Sadly I can't as people who own private property can't buy it unless they sell the private property

It is a lot cheaper than buying a home private i.e. 20% of market rate for the same square footage for young first time buyers and you can decorate/refurbish/knock down walls as you wish . You can also rent it out after 5 years of living in it (one of my aunt's rents it out now and moved in with her son so it's a pension).. the joke is that the British actually started this social housing program in Singapore and its still going strong while it has been dismantled in the uk...

Be quiet the free market is an outdated idea anyway

You do have a say to some extent at the ballot box. Let's hope people at sense at the next opportunity...

What's your AIBU though? Your heading says one thing and your OP says something else.
There's a world of difference between 'no-one has a right to make money off their house' and 'everyone deserves to make money off their house and for the government to pay for it'.

Most people will sell for more than they bought, even taking interest into account. That profit is indeed unearned income.

In the main, people make choices that suit them. They are responsible for these choices.

Many renters have no help whatsoever, the majority in fact. As you probably know, rents have also been rising very rapidly because of the interest rates rises and failed policy but renters are second class citizens in the UK so don't get the coverage that mortgage holders do. I guess you think the government should also help renters who pay their rent out do you?

Because life on the dole is hellishly hard. If you think otherwise, then you should probably stop reading the Daily Mail and watching Channel 5.

I meant to add that the level of entitlement in this and other a few other posts is astounding!

I can’t read 29 pages sorry but if you’ve not thought about the fact that a large number of repossessions/ bankruptcies would cause complete financial meltdown, you’re an idiot.

You're right, we did decide against communism. So you agree with the OP that struggling mortgage holders shouldn't be bailed out by the state?

On the one hand people are always bitching about landlords getting rich off the back of tax payers due to housing benefit but on the other hand they are moaning that renters don't get any help. You can't have it both ways.

You can certainly have it both ways if you grasp that most renters don't get any housing benefit and pay for themselves! Several posters seem ignorant of this and very snobby about people who rent.

How would I be bailed out as a renter then? I don't claim benefits.

At November 2020, there were 1.1 million Pension Age and 1.8 million Working Age recipients. By comparison, 2.8 million households had a housing element as part of their UCassessment, of which 2.5 million were in payment.
5.5 million renters received housing support in 2020

This would be perfect

Does anyone think it’s reasonable for first time buyers to hold off buying for now, even though we have the deposit? Mortgage would be so much more than rent for a smaller price and we’re worried about negative equity with us having a low 5% deposit

That is meaningless unless you give the figures as a percentage of total renters.

The problem is that the problem (inflation) and the cure (rising interest rates and wage stagnation) both seem to have the same negative impact on a section of the population that is rapidly becoming the dominant voter base in this country - the middle aged. The reason why this is getting a lot of noise is that it is a major political headache for all the parties as there does not seem to be a way to win.

It is okay to say that mortgage holders don't deserve help but if you just accept that the middle aged middle classes should have their spending power wiped out by a tripartite pincer movement of high inflation, stagnation of wages and increasing mortgage payments then you will have high unemployment, reduced growth and potentially a long recession.

The problem is that those that have benefitted most from the last 15 years are effectively untouchable by fiscal or most taxation policy (I'm talking about the wealthy retired and ultra-rich) and so the rest of us will end up paying and we will vote out governments that accept that is the only economic solution.

Not really. The idea that renters are some poor hard done by group is ridiculous.

It depends on the renter but, yes, as a group, renters have a pretty terrible time in the UK.

Well obviously you would be directly bailed out but as I said, if your landlord has to sell up, you'd be out of your home.

If your landlord gets some form of help to prevent selling up, you'd be spared the stress of having to find another home.

@Laughingstock1991 what will you do if you can no longer afford your mortgage?

It is unpalatable to me for the government to pay my mortgage, and I think there are some better ideas on this thread than that, but when we are in a situation where there isn't enough social or private rentals available where do the repossessed go?

You say that but I've honestly never had a bad time renting. I appreciate some do, but not IME and my tenants are pretty happy too.