to think the current economic crisis is far from over

[Litchick]

I know that the Bank of England announced we were back in growth, but when I look around me things still seem pretty dire.

Two shops in my local town have shut down in the last month.
A friend recently closed her internet business.
The industires I know most about are in melt down. Publishers are ridding themselves of staff and taking on very few debut authors. DH tells me the city is dead and the start of 2010 has been the worst he can remember.

Do we really think there's going to be a turn around soon? Or are we in for a long hard slog?

You cannot have a country full of people with 250k mortgages with houses worth 120!Chaos would ensue.Especially considering how many are interest only It would mean the mortgage would never be paid off

Oh I agree, I just mean saying people should 'suck it up' is just a bit mean, they are screwed too. And I wouldn't necessarily worry about neg.eq either if we weren't moving. (We're not, but we're not in neg.eq anyway.)I think I'm just feeling stupidly sensitive to everything at the mo, including perceived 'mean-ness!

People can still pay their mortgage but have neg.eq in their house?? The two aren't related. Just means they might not want to sell as they would still owe £50k or whatever to the mortgage company. This doesn't do the housing market any good as people are reluctant to sell. Those who are forced to sell for whatever reason are screwed indefinitely. Very sad.

I know not sure what the answer to this is.Maybe stagnation for years?

Interest only looking v risky

Quite, as are all of the graduates etc on the 101% etc mortgages. That always seemed like a ridiculous system anyway. I really do think that the only answer is a back to basics approach...house prices dropping, realistic expectations in terms of material possessions, holidays etc etc. So house prices dropping is a good thing long term, just a hard thing for many people in the short term...this hardship can't be glossed over just cause it'll make it easier for others later.

This is exactly the problem.

If interest rates rise to bring house prices down, the real price (the money out of your pocket) stays the same anyway. If you bought a house in the last five years one could be as screwed as everyone was in the early nineties crash. (This last boom is the only thing that saved some of those, ten to fifteen years later.) One is double screwed, because you're paying higher interest rates partly for the purpose of seeing the value of your property crashed.

People's lives were ruined by the last crash and they're being ruined by this one. Ruined for years and years.

The only thing that can save those people from ruin is low interest rates and house price confidence, and that's going to cause ruin for others.

What a nightmare. An economy built on nothing while the education system stagnates. A real, sound ending to this cycle can only come when the education system is revived. But even then there's seems to be a lost generation utterly kippered in the middle of it.

Perhaps in that case we'll go back to the years of long, protected lets. 40 yrs etc at reasonable rates. I'm not saying that is a good thing as I don't know.

renting needs to be regulated to a standard that makes it an attractive alternative so that people can live decently until they wish to buy if indeed they ever do

Neither do I.

We (our generation) did it by buying and selling a couple/three times. But now hasn't massive stamp duty put paid to that possiblity?

'renting needs to be regulated to a standard that makes it an attractive alternative so that people can live decently until they wish to buy if indeed they ever do '

and that will never happen in this country because then those who own the property for investment will not have as liquid an asset as desired.

because in the UK now, property is often seen as an investment rather than as someone's home.

Possibly but it could work the other way. Not all property is meant as a liquid asset, in fact that's rather snort inducing in the current climate. I know two families who own a second property as a pension and are more than happy with long term tenancies, as would I be under the same circs.

Tenancy laws do however give rights to buy after certain lengths I think -- am I right? that would have to go.

And I am not sure that renting isn't regulated to a decent standard. The laws are certainly in place, just because some landlords break them doesn't mean more regulation is required. I've been a landlord and it all seemed very fair to me, very much tenant-heavy rights, much more than other countries.

Also, property as an investment is now very much a long term issue. Stamp duty means buying and selling is harder and more expensive, and one hopes there will be no more insanity booms for some time. It's a self-regulating market: if long term tenancies are in demand, the supply would grow.

I have a buy-to-let that started out as my first flat. When I moved in with my husband I rented it out to a young family who have been in there for about 18 months and hopefully much longer. It pays the mortgage plus a little extra that I save for insurances and maintenance. I am thinking that I might sell it next yr or the yr after, it is a weight on my mind and if we do move further away getting back will be a pain.

There are good long term landlords like the one we have now

however with the economy the way it is there's a missing decent social sector

When Dh was unwaged for a while prior to Uni we lived completely hand to mouth and sometimes went without food as adults; why? Becuase the landlord would have a right to evict us had we accepted the housing benefit we were entitled to.

Now, it wouldn't be ehr fault- a lot of landlords are put into that position by the agencies with whom they are signed.

If we lost this palce now, no local agency would let to us becuase they slam the phone down if you don't have regular FT work; we can add together DH's PT job, my CA, Dh's stuident income and afford the level we are on now but that would an absolute no-no, so we'd end up in a hostel waiitng for somewhere to be housed. A hostel with 4 childrem 2 autistic.

AKA a nightmare.

That bIMO is where the ionput is needed; the gap between complete dependency housing and private rentals, plenty of people on lower incomes etc totally able to access the latter if landlords had to look at affordability over work hours / not allowed to discxriminate against children etc

'Tenancy laws do however give rights to buy after certain lengths I think -- am I right? that would have to go.'

No. Some councils still allow right to buy for new tenants. Many have now abolished it for new/newish tenants and/or placed moratoriums on right-to-buy for existing tenants, which they can extend relatively easily.

Private tenants do not have the right-to-buy.

At the moment there are lots of grandparents still living in family-sized houses. They are living longer or living longer healthily so they don't want to sell up just yet. They want the space for visiting family. This is one reason why there is a bottle neck and high prices. Eventually this generation won't be around and the generation in the middle of the sandwich: us, will have the capital from the houses. Which we can then pass on to our children so they can afford deposits.

But of course if you vote for a government that will make your parents sell their house, or taxes their estate over and above IHT following their deaths to pay for care which they may or may not have used (Labour's latest plan) you will have little capital to pass on to your children from your parents.

Nowt for us either, Mum is in rented and MIL has disowned us for being Evil And Not To Be Tolerated (that actually emans we refused to completely cut contact with FIL after their split and she is also rather unpleasant- I can back that up, not random meanness. Oh and she gave the house to BIL last year which is fair enough actually as he still lives there)

FIl lives with his fiancee and we would get half with her share going to her DN, but as she is DH's age.... chances are FIl will be gone and she long remarried with will changed by then. Dont get me wrong, she's lovely, but we were long married and the like by the time she appeared).

Dh should be back on full income in 2 years, and we would register immediately for the council sahred owndership scheme but they don't come up nearly often enough. Worth a shot though, a single sa;ary would only buy half of this house.

Well, both of your parents are in very own, very nice houses...and we don't have any family in rented. BUT, with inheritance tax being the bugger that it is and the cost of care (fingers crossed this won't be needed for a while etc) I am not, and never have bargained on seeing any of the capital tied up in these places. (They have no mortgages.)

Mrs C I think that is the safe way tbh

This house was left to the owners schildren by their Grandad and when they want it back we will be let go (dont know how old they are, am hoping they are planning v long Uni career somewhere far away as market stagnant here so cash better than risking it atm) but who knows?

When we thought we'd get MILs house it would have been nice but thats it- no more, never actually was ours so no loss.

Actually BIL is single with no kids so the boys may get the bungalow. Who knows? Up to him