House Prices

[JoeBloggs]

Are you talking about the early nineties crash? That one was more to do with interest rates going through the roof.

No the 2008.

 

[JoeBloggs]

This is something that has been raised a few times at government level and I think in time will have to become a part of the mortgage application process. If you’ve rented for years, have never defaulted, have a good cedit history and have a stable income then that should be enough without the requirement for a ridiculous deposit.

Sadly there was a history of giving people large mortgages with next to no deposit who couldn't afford them, hence the crash. Banks don't give out mortgages to help people, its all to make money and if you default it is worse for them so its easier not to grant it, along with the next legislation which means they can't.

 

[Giggling Squid]

My niece used the help to buy for her house. She had it valued last week and its increased by 40k in two years. She'll move soon but you have to pay something back, not too sure if its the deposit. Think if you sell in the first five years you pay something back.

With help to buy, the government loan you a % up for 20% of the value of your home, which opens you up to much lower interest rates because you have a higher LTV. you basically owe the government whatever % of the property value that you took as a loan. Eg we paid a 7% deposit, and took the 20% help to buy loan, then a mortgage for 73%. If house prices go up, the value of the loan goes up, if they go down the value goes down

the loan is interest free for 5 years, then you pay interest on it after that unless you pay it off/remortgage to take it into the mortgage/sell.

It’s good to get on the ladder, but you pay a premium for it in the price of new builds, and it’s much harder to pay off/move in the future

 

[JoeBloggs]

I'm not British and find the NHS situation and lots the rhetoric surrounding it fascinating.

People want to pay as little tax as possible (and vote for those that promise this) then expect a Nordic level of health service.

Something has to give somewhere with such unrealistic expectations.

If I had an asset and lived somewhere that had chronically underfunded health care I'd be happy to use that asset to provide for a comfortable life. This idea that inheritance should be a right to pass on I do find a bit odd. Especially as lots of it isn't even earned income but asset appreciation.

See I don't think people want to pay as little as possible, but they do not want to pay more when what they currently pay isn't being spent well.

Health care isn't underfunded because the money is there and pumping more money into the system and taxes isn't the answer, better spending is.

This also opens up the issue of benefits etc from personal experience the system isn't working. It gives too much to those who don't need it and doesn't help those who really do.

 

[Rxt156]

I got called by the estate agent who sold us the house just over a year ago, asking if we wanted to move again as they had people interested in the house….err no you’re ok

As if you’d move house so soon based on a phone call like that !!!



Although I know of someone that had a knock on their door from an elderly lady that said can I buy your house I’ll offer you over asking price as it’s my childhood home. Ended up getting £40k above value and the old lady was buzzing. Win win!

 

[justbeingnosy98]

Is anyone else in the process of / thinking of buying just now? I’m really worried I’ll pay a hugely inflated price and then the market will crash

 

[Anne1448]

This article on Tony Blair from 2016 popped up, says it pretty well:

On Monday, the Guardian reported that the Blairs now own a £27m property empire containing 37 different properties. They own an £8.5m Georgian townhouse in Connaught Square (that’s more than doubled in value since they bought it in 2004). They own a £750,000 country home out in Buckinghamshire (I mean, we all like to get out of London sometimes, right?).

The Blairs, to be fair, aren’t keeping all this wealth to themselves, but are redistributing some of it. Specifically, they’re redistributing it to their children, three of whom have names on the deeds of their own central London properties worth upwards of £1m. Eldest son Euan is also a director of Oldbury Residential, a buy-to-let company with 27 homes in Greater Manchester, which he co-owns with his mother, Cherie. His younger brother Leo doesn’t yet seem to own any real estate, in prime central London or otherwise. He’s only 15, though, so there’s still time.

To be fair to the Blairs, they’re only doing what many other families have done. Buy-to-let homes have become the asset class of choice for the well-to-do baby boomer, for the very good reason that returns on most other forms of investment have been rubbish. And, as the bubble has inflated, more and more affluent parents have felt it’s their duty to pass the wealth down to their kids. It’s rational. It’s natural, even.

But there are two problems with this argument. One is that, however inadvertently, Tony Blair was one of the architects of the housing crisis in which we now find ourselves and of all the problems that flow from it. I don’t think that was deliberate – but he is nonetheless profiting from a crisis that he helped to create, and that’s a pretty big black mark against any leader’s record.

The other problem with dismissing the Blair property empire as normal, middle class behaviour writ large is that it downplays quite how damaging the buy-to-let boom actually is. It isn’t simply that it’s crowded first-time-buyers out of the market, though that hasn’t helped. It’s that it’s created an entire class of people who have a financial interest in keeping rents as high, and housing regulations as weak, as possible.

Landlords tend to be older and richer than their tenants; they’re also more likely to stay in a constituency, and more likely to vote while they’re there. All those things make it far easier for the former group to get their voices heard than the latter.

As if that weren’t enough, nearly a third of MPs are landlords too, and while most no doubt think they do their best to hear both sides of the argument before legislating, they will nonetheless find it much easier to grasp the arguments against stronger tenant rights than the ones in favour of it. People are generally remarkably adept at seeing the moral case for their own financial self-interest.

The government of Tony Blair helped create the buy-to-let class. Now, he is its prophet, its talisman, its patient zero. Yes, the Blairs are only doing what any other rich, middle class family would do. That is precisely the problem.

“Tony Blair helped create the buy-to-let class. Now, he is its prophet, its talisman, its patient zero” - CityMonitor

Maybe I’m getting soft in my old age, but I sometimes feel like the Left gets a bit mean about…

citymonitor.ai

This is absolutely frightening. If the family owned a few homes, I honestly wouldn't mind. But the fact that they own 37 homes is astonishing. These are 36 homes that families could own. 36 homes that people could buy to live in without fear of a rent increase or expulsion.

The people who vote for parties such as the one of Tony Blair better not complain when they'll see more homelessness, child poverty, insecurity and violence. Housing is not a commodity but a human rights.

 

[Lanavalentine]

Wow, what an interesting thread. Its been really interesting reading all the posts here.
I dont know anything about buying a house. My parents were always in a council house, and my mum still lives in the council house where she raised me and my siblings.
My partner and I, have a mortgage. Our little house is an ex council house on a small estate that was council but i think its all mortgaged houses now.
I have always always always wanted to live in a new build! But my partner who is an electrician said no because he has worked on enough of them to know how they are thrown together and normally have loads of issues a year down the line. But i cant lie, i love New Builds. I dont know if its because im shallow and dont know about houses, or what. But at the time, in my head i thought if we got a new build then we really would have 'made it'. I hope that makes sense, i know i probably come across as a right vain bitch here! But i had nothing growing up, i am the first person in my family to go to uni and get a mortgage and have a 'professional' career, so it was probably more of a status thing caused by me not knowing anything about houses. I am very proud of our house though, i mean its nothing special- just your average 3 bedroom, semi detached house. But it needed loads of work doing to it, luckily my partner is an electrician and just generally very good with everything so between him, his plumber friends and his builder friends, we were able to do it up to a really high standard. But i think this is our forever home, im almost 35 and he is 46. We have a friend who has moved houses 3 times during the past 10 years and now lives in a huge beautiful house, but the mortgage is sky high. He is the same age as my partner and i know he is absolutely skint now and he said he wishes he was still in the first house he got.

You don’t sound shallow or vain at all!

I tend to agree with @heretoreaditall2019 and your partner - the build quality of a new build is definitely usually inferior to an ex-council house.

I think it’s a lot to do with the spec of a house, usually. I can understand why new builds seem like a dream to many people, because they’re usually detached with parking, have en-suites, and obviously you usually get to choose elements of decor and it’s all seemingly done for you when you move in, all crisp and fresh and new.

The reality however is that usually the rooms are smaller than in older homes, the layouts don’t work well, there’s often not enough storage and things are badly designed so it’s not easy to add in. I’ve also known of people who’ve never had their snagging finished, so their new build still has issues years down the line.

I’m sure there’s a few gems out there, but mostly they are totally overrated and are bought by people who want to project a certain image. I get it - it’s a nice image. But scratch the surface and it’s not as good as you think!

I bet your house is lovely. So handy having a partner who can do all that stuff!

 

[andreaoid]

BTL is no longer profitable for an 'average person' without setting up an Ltd. The amount of tenant rights (hurray!) and landlord obligations are slowly making it not lucrative as an investment. Younger generations invest in stocks & shares which bring the similar ROI without the hassle of taking care of tenants/properties. Also, properties are illiquid, not a great investment if you need money quick.

The biggest problem of an 'average person' to be a landlord is that they are mostly unaware of tenant rights/protections and landlords obligations to make properties habitable no matter what costs. When tenants stop paying, they all start crying about loss of income. Unfortunately, that's the law. Government protects people's homes over someone else's investement. That is not a problem with S&S though.

 

[Kmt2019]

I have seen prices in my area go up 40k in the last year alone. Regarding house prices and the recession, I think they may stay the same or drop in London, but outside of London I don’t think they will drop due to other factors to consider.

1. COVID-19 allowing people to work from home, therefore not needing to live in London and not needing to commute. Therefore wanting to buy places with more space and land.

2. Stamp duty being cancelled, therefore making people who have been wanting to buy do it sooner to make the most of the saving. Also it makes buying more property v attractive to people who already have property, but want more for buy to let / property portfolios.

3. Lack of good quality housing stock. There are new build estates popping up all over the place, but majority arn’t built to last. Demand outweighs the supply for quality housing.

I’m no estate agent or expert, but that is just my two pence!

 

[Italy2]

It’s so bad, a friend has done the same and the loan goes up with the house value?!

The WORST I’ve heard of is the shared ownership (the ones I’ve seen IRL have been out of London), the only examples I’ve seen have been horrific properties that require £30k+ of work to get them even livable, utter slums. They’re selling off dilapidated social housing stock dressed up as a scheme to help low income people get on the housing ladder. I know someone living in a glorified squat who pays for for 100% of all repairs / upkeep whilst paying rent, will never own the whole thing and can’t pass it onto her kid? And if they came to sell you can’t recoup the £3k boiler or the re wiring etc etc before splitting profits with your HA! Why on earth would anyone ever do it?!!

I have read up about Shared Ownership schemes and the statistics show that hardly anyone ever manages to buy more equity in the house. This scheme is such a trap for young people or low income people to lure them into buying a house they will never ever own. You are essentially just paying someone else's rent whilst paying for all the repairs in the house. Sadly, many people don't read their leases, tenancy agreements or property ownership document to understand the implications of what they are signing up for.

I work in commercial property law and it's alarming how many people sign a lease without understanding what they are signing up for.

 

[heretoreaditall2019]

archive.md

“"I'll slow down at 30, I can't retire completely then I'd be bored, but I'd like to get a sail-boat like my grandad and pop over to Italy for the odd six months.”

he has very unrealistic expectations on the (net) rental yields those two £120k properties will get him

 

[BettyCrockerr]

Exactly that’s my point… no need

Her phone contracts are for her kids, Who are at Uni. She’s paying for her kids to have phones while they study.
who the hell do you think you are to try to tell her this is ”unnecessary“ spending when you yourself have had help from your own family to get on the proper ladder?!

 

[Mrs McCarthy]

The properties wouldn't disappear. 90% of people that rent want to buy.

So no problem if 90% disappear. Or even if 100% disappear and the government invests in social housing to fill the gap. They're leaches.


Sell it if they don't want to be a landlord, and the inevitable risks that entails.

Saying no one should own more than one house is not anywhere comparable to saying no one should have a mortgage

You are wrong in saying that 90% of people who rent want to buy. Do students want to buy a place in a city where the are only likely to stay for a few years, for example? No.
There are many people who have to move around for jobs. There are migrants that cannot get a mortgage - yes, I am a non-eu migrant and regardless of my salary I cannot get a mortgage for 5 years in this country. There are migrants on temporary working visas, who will need to leave after the visa runs out. There are people who have to move around for their job or career. There are people who just don’t want to tie themselves down to one place.
Not everyone has to buy, although because the economy of this country is linked to mortgages, people are conditioned to think that way.

 

[Yel]

Not suprised, madness to buy during a frenzy and overpay.

Quite possibly prices will decline in the next few months, Halifax already showed a fall last month.

 

[JoeBloggs]

But what's the alternative? You can't get a decent family home for less than £300k and that's in Yorkshire. Even if you settled for a 200K house, a 20% deposit is £40k before you've even taken other fees and costs into account. How are people supposed to rent and save at the same time if they want a decent home?

Sadly I don't know. I live in Surrey so I am all aware of ridiculous house prices. A 1 bed flat goes for £260-300K where I am from.

For some, like me, the answer was moving 20 mile away and the price dropped by £100-150k and even then we bought a wreck. I know many who refuse to commute that bit more and therefore cannot afford to buy. I also know many who don't save and live lavish lifestyle and then complain they can't afford to buy.

Salaries need to come in line with living costs, but I can't see how employers can afford it and the government is not going to be able to subsidies it. House prices should never have been allowed to escalate, but it was all about supply and demand. The House market and crisis is a very complicated and interwoven issue.

 

[heretoreaditall2019]

My next door neighbour is selling her house (I am gutted as we get on really well) and I’m checking Rightmove constantly to see if it’s up yet so I can see inside as I’ve never been in

I’m in a similar situation, mine sent a grand ~reveal~ text that they were moving about six months ago and yet absolutely nada has happened! They’re nice enough but they are so fucking loud when dealing with their kids out the front of their house several times a day, I’d be glad to get someone new you can’t exactly follow up on that like so when ya off hun tho can you!

 

[Yel]

Most have more money than ever and the demand for rentals is so high.

I think it's going to be very split, some people have done well and others less so. Only once tax payers support is withdrawn will the full affects be felt.

Then you have to factor in that some of these people that will never go to the office again, might find out after proving the case study their jobs are outsourced to someone on 1/5th the wages.

Very uncertain for so many people and we're in a transitory phase right now.

 

[Moe]

@Mrs McCarthy I stand by what I said. I don’t dislike Estate Agents I find them amusing and I’ve had enough dealings with them. I also have a good friend who is one and socially is the best company ever but I do know the shit they get up to.

 

[BettyCrockerr]

Not sure i agree about it being a mixed up world where owning is cheaper than renting. It makes sense to me. You pay a premium because you dont take on the risks/rewards of ownership for example. You also (sometimes) dont have to pay bills/council tax etc. You also have the flexibility to leave the property much more easily - you dont have to sell you just have to give notice.

Owning on the other hand might be cheaper per month, but that is largely because of the significant deposit that you need to put down first.

Where in a rented property wouldn’t you have to pay council or bills?!!! Have you ever rented before?!!!! if you rent your home you are not exempt from paying bills - you still have to pay council tax, utility bills etc as you would if you owned the property. The only exception perhaps would be for students (who don’t have to pay council tax) or people living in a house share rental where they will pay a proportion of all bills combined with rent - rather than having their own separate household bills in their own name.