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!

https://www.express.co.uk/news/politics/1782017/mortgages-interest-rates-bank-of-england-inflation/amp

Thankfully most people can see it’s madness to use taxpayer money in that way too.

There needs to be a housing correction.

From the BOE “The single most effective policy to help mortgage holders is to bear down on inflation, thereby limiting interest rate rises. Borrowing money to subsidise mortgages risks fuelling inflation further, forcing the Bank of England to respond with even higher interest rates. It would be totally self-defeating.”

So I guess it answers my original question!

Maybe any solution has some consequences but surely far better than current mess. The key point is people should be able to buy houses if they wish to; at the moment they can't. This affects by far the majority of the population and should take priority. Communities cannot grow without this issue being solved.
A few thoughts though... not so many years ago people used hotels on holiday which also created jobs for locals. Few holiday lets. And holidays don't trump home-ownership in what society needs. And someone renting a lot could also buy and rent that out if they were able, while renting elsewhere; know people who do this when their jobs are peripatetic.

This week dataloft released its latest update which is all about home ownership. The census began recording mortgage status in 1991. The 2021 census marks the first time the data has shown that among homeowners, those that are mortgage free are now in the majority.

It shows that 33% of households own their home outright compared to 31% back in 2011. Even more interesting the number of people with a mortgage has dropped by 4% to 29%. We all expected this to be higher, after all, we all have mortgages on our homes still. However, the recent historically low-interest rates have enabled many savvy homeowners to pay off their mortgages faster.

More people than before though are choosing to private rent and maybe this is reflected in the drop in people getting a mortgage. It certainly appears that way. We have seen over the years that for many people, rental is actually a preferred choice as it gives them freedom and flexibility to move with their work.

https://www.lancasterpropertyblog.co.uk/33-of-households-in-the-uk-own-their-home-outright-what-percentage-is-it-in-lancaster/#:~:text=The%202021%20census%20marks%20the,to%2031%25%20back%20in%202011.

I would also think that one reason why there are more people who own their own home outright is the ageing population. There are more older people alive who have paid off their mortgage. But many are stuck in unsuitable homes that are not adapted to their needs so it would be good if there were more suitable housing stock for them to downsize to freeing up larger homes for famillies. They then release capital to pay for future care needs allowing them to stay independent for longer.

Mortgage companies are raking it in in France it's only what 2 to 3% interest rate. There will be a divide between rich and poor where only the rich can afford properties and you begrudge people who inherit property who are not rich. Op I don't know what you think is going to happen but what ever it is you need to go to work and pay 6% interest for your mortgage every month because it ain't going down ever. Even if you can afford to buy a house you need to pay through the nose to keep it. Good luck with your fantasy

A lot of very sensible people continued to make the original payments on their mortgages when interest rates first went down. There are people in their 40s who are mortgage free.

How are families going to afford those “larger” homes?

No one has a right to buy a house. It’s always been an activity regulated by availability of loans or personal money.

Isn't it a Tore mantra home ownership and people running their own business. The Tories are destroying that. Brexit is the reason for high interest rates and inflation.

Op I don't know what you think is going to happen but what ever it is you need to go to work and pay 6% interest for your mortgage every month because it ain't going down ever. Even if you can afford to buy a house you need to pay through the nose to keep it. Good luck with your fantasy

@Hotsummerlatenightstrolls not even sure what your point is here? Have you even read the thread? My point is that taxpayers cash should not be used to bail out homeowners. A point seemingly shared by the Bank of England. There is no fantasy involved here, despite some of the entitlement on this thread.

Definitely disagreeing with that statement too for sure of "Those that rent chose to do that". That's true for some people - but many of those renting would buy if they could. That was true in my generation even and I was frustrated and furious that I had to rent - because of not being able to afford to buy. In my case - my mothers side of the family were home-owners for some generations to my knowledge (ie before most people were) and so I was born virtually saying "My name is Eliza - and I'm a home-owner" and there was never any question in my mind that I was a home-owner and would buy pretty much as soon as I turned adult. But I was single and, for that reason, I couldnt buy a home when it was due (ie only one income to do so on) and kicking my heels at the fact that, if I'd got married, then one would have happened pretty instantly as per plan. It's a long story of how I finally managed to buy a house at last - 10 years after I'd decided to do so that year and it was not by the conventional "save for a 10% deposit and then get a mortgage for the rest" method either in the event (a long story to do with "Manifestation" to get the much bigger deposit I needed as a single person and a bit of intuition telling me of a chance that was coming up). Despite being very much a "home-owner" - I'd have had to spend a very much longer time before I got a house/if indeed I'd been able to buy one ever - so "No - some of us don't choose to rent - and are absolutely livid/depressed/you name it if that's what we're forced to do" against our will.

We work with estate agents if someone was to lose their home there is no products at the moment to sell that property. I spoke to a cash buyer who is buying the property outright and then she is going to rent it. The rental market is booming at the moment.

The flat she is buying is £700,000 and she is paying cash for a flat to rent. People are doing their thing and making money.

The flat she is buying is £700,000 and she is paying cash for a flat to rent. People are doing their thing and making money.

I felt resentful when I saw the suggestion that people should be bailed out with their mortgages.

When I bought my house I borrowed within my means and bought a smaller house than I could have afforded if I had borrowed to the limit of my means.

I know house prices are much higher now but that just means you have to buy a smaller house or a house in less expensive area. It has always been the case that you can't always afford what you want. So people should have considered what they would do if interest rates rise significantly, just as I considered what I would do if I lost my job and if we could afford to live off DH's salary and vice versa.

That's the opposite of the general view that landlords are getting out of the BTL market.

Estate agents are suffering as well their only income is rental properties. If your property is managed properly then their is no reason for landlords to sell up and they buy the property outright. Banks aren't lending to people who wants to buy property.

@Hotsummerlatenightstrolls Estate agents are suffering as well their only income is rental properties

Gets out tiny violin…..

I don’t mean to be rude or dismissive but plenty of blame for the current out of control situation lies at the feet of estate Agents for ramping the market. I feel very little sympathy

@Hotsummerlatenightstrolls Brexit is certainly not the only reason behind rising interest rates! You clearly don't do nuance. Or read very widely.

@EffortlessDesmond I listen to the experts and you don't have to be a genius to work out that being part of a bigger market will be better for the economy rather than leaving that market and shrinking our own market.

@EffortlessDesmond talk to Rees-Mogg and ask him why everything is going up. France is alright 2-3% inflation and they went through COVID and they have been affected by the war in Ukraine. How many excuses are you going to make before you see that the Brexit vote has made us poorer.

I do wish we had not shot ourselves in the foot, but suggesting that inflation and rising interest rates are exclusively a British preserve is simply not true. I couldn't tell you what inflation rates are in every EU country without looking up the details, but most of Europe has inflation running uncomfortably high, between 5 and 25% (Estonia); food inflation is certainly inflicting pain on Spain, which is one reason why the PP is likely to replace the Socialist party next month. The ECB is raising interest rates from the same 0.1% as the UK, but slower, and the Fed is a bit ahead of the UK. France has kept inflation down by mainly using nuclear power, rather than imported oil and gas.

@GrannyWeatherwax23 👏

Whilst interest rates were low, quite a few homeowners made overpayments and actually reduced their mortgage term buying paying larger chunks off.
I wish for the last ten years I made overpayments.

I could effectively sell my home in the south east, and buy a house out right in a cheaper part of the UK.
However, we’d have no family , no connections , no friends etc. If I was a first time buyer however, I’d seriously look at moving to where I could afford.