Daily Mail: Is Britain's property bubble about to burst?

[FabulousSophie]

I was reading this article in the Daily Mail today, and was particularly interested to see there is now a campaign group called Priced Out, which is campaigning for affordable house prices. I googled them and went to their website, and signed their petition.

www.dailymail.co.uk/news/article-6064685/Fears-grow-house-prices-fall-fastest-rate-financial-crisis.html

Well they're currently using various 'help to buy' schemes stamp duty relief for certain buyers. Those are just measures to prop up house prices - they don't genuinely help FTBs because houses just go up by the same amount.

@wherewithal because what choices do they have? They are a victim of the house prices as much as those that can’t get on the ladder. I have equal sympathy for both groups.

wherewithal I do agree with you that buyers are adults, who are responsibe for their choices. A FTBer who pays top dollar today will be fully aware from reading the newspapers that prices could fall and they are taking a risk. That's why it is wise to follow the news.

@NeverTwerkNaked They could rent. Which I know can suck, but not always. Nobody has to buy. And if they end up in negative equity, they still have a house.

I’m not sure why you want sympathy as FTB if you won’t extend it to others in your generation. It doesn’t affect me either way (we have ample equity) but from an outsiders perspective I have equal sympathy all in your generation whether they have overstretched to buy or can’t get on the ladder.

wherewithal - Very well said, it seems to be quite acceptable to criticise, in fact mock and sneer at, people who have held off buying and watched prices rise even further.
Yet anyone who overstretched themselves financially and then potentially finds themselves in negative equity should, apparently, get only support and sympathy.

If people can buy a house I don’t see that as “less prudent” than renting, as in many places mortgage payments are cheaper than rent.

People are sympathetic @jemihap. It’s what motivates me every day in my job, and the organisation I work for gets nothing but support in its efforts to provide more affordable housing (for rent and purchase). But everyone who is feeling caught by high prices deserves sympathy, that’s all we are saying.

Honestly though. Prices come down a bit so, other than those forced to sell through circumstances, nobody sells, they just sit tight. Then, because there are so few properties on the market the prices go back up a bit because you’ve got a ten buyers for every property for sale. Those who have stretched themselves to buy their first homes recently will be stuck until the prices rise again and therefore no FTB properties are available.

I’m not sure why you want sympathy as FTB if you won’t extend it to others in your generation.

@NeverTwerkNaked I’m not in that generation and don’t require sympathy (though I am a lowly renter, as it’s much cheaper than buying where I am, and makes sense).

Personally I want all housing to be affordable – which is not to say all of it should be cheap, just that it should all be priced with sensible wage multiples in mind.

I’m not sure why you think anyone disagrees with you on that though. I would like there to be plenty of affordable housing; that doesn’t change the economic reality of what tends to happen when prices dip.

And who sees you as a “lowly” renter? No one on this thread has in any way implied that renters are inferior. The current 20-35 year olds, as a generation, have been most badly stung by soaring house prices (whether they have stretched and bought or rented).

That was my admittedly roundabout way of saying I believe “affordable housing” does more harm than good. As for being a lowly renter, surely you jest, at least if you spend much time here.

If we really want houses to become affordable we need to stop investors, stop people owning more than one home, redistribute jobs evenly within the U.K. and reduce the income multiples for mortgages. These measures will help ftb much more than a crash.

Also stop schemes such as htb that only lead to tax payers inflating the housing market

I agree that all housing should be affordable relative to incomes. Affordable housing is usually gathered together in estates or subsidized developments, keeping the inhabitants separate from the inhabitants of non-affordable (ie market) housing. That kind of balkanization is not a desirable outcome. If the government stopped pushing house prices higher and higher, normal market housing would become affordable.

Market forces will always win out though. So Chelsea will always be ‘unaffordable’ compared to most other places. Same for the south east relatively speaking. What is your opinion on this out of interest?

In a market based system there would be expensive areas of town and cheap areas of town. An economically successful region like the south east should be able to pay higher wages that could support higher property prices at all levels. If the economy could not support the prices, either wages or prices would need to adjust.

And yet everyone on here moans about paying more for builders in the south east ;). Also what about nhs/teachers etc. These occupations are needed nationally but receive very little more for working in the south east. Are you saying we should pay people in the north less?

It is more likely to be brexit scare mongering. They'll eventually be right at some point because every bubble has to burst eventually.

The affordable housing built by social housing providers found here is generally of far better quality than that built by private house builders.

And I wouldn’t turn your nose up at where it is located (with other affordable housing). Most people have to start of with a first home that isn’t in their dream location.

I think it would be better to pay nurses, teachers and other public sector workers in the SE higher wages because the cost of living is higher in the SE. Nurses in the NE probably have more disposable income currently than nurses in the SE.

I completely agree. But that will never be voted through realistically. Most voters live outside London! And what about a cleaner who works in the most expensive London postcodes. Should he/she be paid a sum that allows them to live there too?

How much more should a nurse in London be paid btw? Double?

What about non public sector workers? Cleaners, waiters, bar staff, retail workers.... It's not just teachers and nurses who are essential.

There is a London weighting for public sector employees already, but it doesn't make up for the housing costs. The fact is that either wages need to go up (everywhere, as northern wages are already quote a bit lower), or house prices need to come down - it is not sustainable to have a position where people working in ordinary jobs cannot afford decent housing.

what about a cleaner who works in the most expensive London postcodes. Should he/she be paid a sum that allows them to live there too?

Yes - within a reasonable commute of work. What's so wrong about that? Why are cleaners less worthy of being able to afford a basic home?