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!

@underneaththeash seriously, I don’t know what you are talking about. Your post is weird and passive aggressive.

As above - ignoring all the other arguments going on

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’m puzzled at the amount of faith in governments shown here - government won’t let this happen, or that.

Government allowed house prices to rise out of all proportion to wages. Government allowed a return to inheritance and focus on capital. Government allows people to die on sanctions. Government has allowed socialising groups to corrupt professions and is allowing maternal deaths to rise as the NHS collapses.

Government won’t save anyone except their seriously rich cronies. None of them.

Also if people didn’t spend on improving property we would have a nation of crumbling shit houses

Well not really. A mortgage is a SECURED loan. The bank needs there to be underlying value in the asset, which is why negative equity is such a shit show for everyone.

We bought our house 2 years ago. Other houses on the street which don’t have our extension, are mid terrace as opposed to our end terrace so have smaller gardens etc are going for 20% more than we paid for ours! It’s madness. Our house is worth 20-25% more than we paidC we have done nothing (well new boiler and redecorating etc but nothing major). It doesn’t even really benefit us as if we wanted to sell and move all the other houses have gone up!!
it only ever benefits people who want to sell and downsize and disadvantages first time buyers who have to find even more to buy a house.

Actually gains and losses is is what makes it a market. But yes in general agree.

Yes and a large sector of the British economy.

But don't worry, all that will happen if the housing market crashes is that people will be back in their boxes about their unearned wealth 😂.

People bleating about council house provision and public services would do well to remember who pays for them....

I agree with the OP but take massive issue with the ' stupidly overstretched '. People have no choice a mortgage is still cheaper than renting. If you want a family and need the space in some parts of the country you need to buy. And when I say space I'm talking two bedroom flat no garden. And even then you have to have been saving for years it's next to impossible.

I would put it in a slightly stronger way and say that it wouldn't be just "pretty unfair" but that it would be morally reprehensible and completely unjustifiable if the same level of help wasn't extended to renters. But as some others have pointed out - if you help renters you, in some cases, you are bailing out leveraged landlords and that would be nothing short of disgusting.
It's a very complex situation and I think the only fair way to do it is not to bail out anyone - but to allow forbearance to those in genuine need. Landlords of residential property should not be included in that, nor anyone with more than one property. I'm no communist but rent controls would be an appropriate way to weed out the parasites who could never really afford to be landlords without huge borrowing. Buying outright to rent I have no problem with - but borrowing to rent to people who can't afford to borrow seems to be exploitation of the less fortunate to me - and is sadly a large factor in us ending up where we are now. I will be mad as hell if residential landlords get any help. Thankfully that looks to be very unlikely.

@Recoveringcynic Yes and a large sector of the British economy

Yes because a healthy functioning economy is always built on tins of farrow and ball paint and twigs in vases isn’t it

Welcome to the Torie party they give and then they take away. They want you to rent from them and work for them that's what they are about. When Boris gave all those breaks to first time buyers they knew what they were going to do. The amount of people who will hand back their keys because they can't afford their mortgage is devastating. Their house will be out up for auction and who else will buy them rich Tories. Read about them we are back in the 70's do your best and good luck.

I'm not overstretched on my mortgage at all, you can still buy houses for under £100k here. If people on lower pay end up in trouble with their mortgage at this level it would cost the government more to pay them the rent element of universal credit and then housing costs in old age than it would to give them a temporary bail out that allows them to keep their home.

My mortgage has gone up by £600 a month and I completely agree with the OP. Why should non-homeowners, who tend to be people at the lower end of the earnings ladder, subsidise my mortgage? It’s a ridiculous suggestion, with all sorts of downsides.

Well you could say the same about eating out in chain processed good restaurants but it's simply a fact. Not sure why you would be so sneering when many people rely on the various leisure sectors for their livelihood.

Or do you think your great 'reset' should apply to all the elements of the economy you're not happy with?

This is a large part of the problem isn't it @Recoveringcynic. The UK economy is built on the housing market and selling off assets to foreigners. Very little productive. The assets are nearly all gone now and the housing market is set to fall. We have a massive amount of debt. Taxes are at their highest. Public sector strikes are constant at present.
What could possibly go wrong?!

@Recoveringcynic Thank goodness for your common sense.

I have read a lot of economic illiteracy on this thread. However house prices are mostly about supply and demand. Plus availability of money. We never ever build enough homes. The idea that anyone trying to sell up and move into rented will find that east is almost laughable. The rental market is very tight at the moment. Landlords are selling up which is, in fact, helping buyers get on the ladder. Often they a smaller homes. It does, however, make renting more expensive. It’s all about supply and demand. As usual.

Hmm

If that's you're opening argument OP, then based on that thought process - those on minimum wage shouldn't have the right to an increase each year - it's 'unearned'... those on NMW aren't doing anymore work for their money. The utility companies, councils and businesses who increase their bills each year have no right - they're not doing anymore for their money.
Seriously OP get a grip and read up on some basic economics. And if you're still not happy with house prices and living amongst an open market go and build yourself a mud hut. Or maybe emigrate to Venezeula where you can impart your economical wisdom and solve their 1198% inflation 'issue'.

They aren't mostly supply and demand, at least not in the way you appear to think.
They are mostly based on affordability which relates to the availability and affordability of credit and real wages.

Totally agree with you, OP. I am of your parents’ generation. The mortgage for the first house we bought in 1981 gobbled up one salary; we lived on the other. Interest rates went to 17%. They were frightening times and they are now for many.

@Recoveringcynic its not sneering or the ‘great reset’ - what nonsense.

Its making sure society can house its population in safe secure affordable housing. And at the moment it can’t because of an out of control Ponzi scheme passing for a housing ‘market’.

I don’t want to see another tax payers bail- or another scheme to prop it all up at the expense of the millions and millions in shit overpriced housing. There has to be an end point to this madness.

But whatever house values do - what about the many, many people who are unable to buy and very likely unable to ever buy? The people who work away relentlessly in the low-paid jobs that keeps the wheels of life going? Where do these people live? Unless the higher paid would take a pay cut to ensure the lesser paid can afford to put a roof over their family's head (which looks like Communism really) then we need to build 'council' housing estates not 'private' housing estates.

It's at times like this when I can't work out if people are too selfish or just too stupid.

You seem to be part of this Ponzi scheme OP, you didn't have to buy a house.