The UK housing market
 

I am certain there are many members who either themselves or members of their family are navigating the insane waters which is the UK housing market.

How did we get here, and who is responsible.? Surely this madness cannot carry on this way much longer, one thing is for certain, there is a chronic lack of quality affordable housing in the UK, but why is that, again who is responsible?.

What is going to happen to young people looking to buy their first home, government is useless on the subject, I actually think they just don't care.

So why are we as a sovereign independent nation NOT building more houses, who is in charge and why are they clearly NOT doing the job they are paid to do?.

The housing market is propping up our broken economy, after all a seemingly buoyant housing market gives the impression of a buoyant economy, the classic pulling of wool over the public's eyes, that is the reason we are where we are.

strange place to put a post on housing mate but I agree with your sentiments, however 2 million houses have been built in the last 5 years, trouble is they are all executve types that earn developers 20 to 30 % profit. during the same period we have lost approx 130000 social homes.

Exactly where are they going to build all these houses?
Where we live they are throwing up houses in back gardens that have been sold for development or on green belt land, no plans for extra infrastructure to support the extra population though.
There is a limit to how large a population this country can accommodate and we still need land for farming, food production and just enough room so you are not living up your neighbours NAUGHTY WORD-NAUGHTY WORD-NAUGHTY WORD-NAUGHTY WORD-! :mad:
Please feel free to have your own opinion, but I for one won't be listening. :getmecoat:

Sure is off to the social forum with it :D

As you say it is totally crazy, I have a friend who is downsizing as his kids are long gone and he has retired. He put his house on the market and within 6 hours he had someone ring him and offer £80k over the asking price :eek:. He did not accept and then the estate agent said they might have to revalue his house as they had several offers well over asking price.

Thinking he had sold he started making offers on smaller properties and lost all of them because he was being outbid by a sizable amount. One place went for over £250k more than the asking price.

He has decided to stay put until it calms down as he might end up paying as much for a smaller house as he gets for his.

People moving out of London is causing a lot of the problems apparently, working from home for over a year has made them realise they dont need to live there anymore and can get a Palace in the Cotswolds for the value of there average house in London.

As far as the infrastructure, they are building about 2000 homes in this area and little or nothing to support all these new residents. A new school and doctors should be the minimum, these should be the first things to go in and the houses to follow together with new roads and junctions.

I think you have answered your own question here.The government is squarely to blame for the housing stampede and have actively fueled it by almost zero interest rates and the stamp duty holidays.This has had a knock on in the rental sector which is also reflecting the sky high prices of the sales market.Lets hope it doesn't all end in tears for those buyers who have paid over the odd's!

when it comes to paying over the odds, perhaps buyers consider the property is worth that amount because of x, y or z and also perhaps take the view that paying over the odds now wont matter in 20 years time.

Not sure what point the OP is trying to make.
As for the stamp duty holiday, some buyers may not have saved money as the price of the house went up a bit as the seller may have thought " if they are saving X on stamp duty I want some of that" and in my case ended up in a bidding war. We paid I think £45,000 above asking and perhaps £20,000 above value but in 20 years will it matter and we have been able to start living again. We were in a small rented property and had to empty stuff out of the garage every time we wanted anything.

As for first time buyers, some earn so little it will always be hard if not impossible to buy, others spend what they earn so save little or nothing, not everyone has the bank of mum and dad to give or loan them large amounts of money.

Decisions made 20 years ago and I'm think about what they did with their money, could be reaping rewards today or be coming back to haunt people.

Council houses should never have been sold. You would be surprised how much green land we have,when you fly over the country you realise just how much there is.

Years ago children got married and got their own place, now they leave home and get their own place so now 2 properties are required.


macafee2

45K above the asking price Ian,utter madness.It's actions like this that are pushing house ownership out of reach for young people/first time buyers.It's your money of course to do with as you will.All I can say is that it must have come very easily to you to spend it like that.I don't know if your new house is mortgaged but those who have over extended themselves had better hope that interest rates stay as they are.l realize that most people are only concerned with their own situation but massively overpaying does not help others further down the food chain.

Firstly let me say, if I have upset or offended you i apologise, there was no intention, I was just talking. No one would have got this house for the asking price, too many interested parties with some making above asking price offers.
I dont know about came easy but we sold for £685,000, with all the fees and bills we had to put in a few thousand. If we had not bought this house we would have had to stayed in rented accommodation spending out on rent, in a house we did not like, with views we did not like, with noise we did not like with a garden we did not like, with a garage we did not like, with parking problems, with our stuff in boxes or a lock up 20 minutes drive away and then, how long would we have to have waited, for the right house to come up and for us to have bought without losing to someone that puts in a higher offer? We are mortgage free and have been for 15 or 20 years. We did not like where we were and it was not doing us any good, what price is piece of mind worth? Via the internet we looked at over 3,000 properties but went after about 6 and viewed perhaps less then 10. We would drive 400 miles just to look at one house.
I completely get how you may feel about outsiders coming in and splashing the cash to buy a property but what of the sellers, they could sell to local people. Years ago my wife told me that there were times when I had gone to bed and she had sat downstairs crying not know how we were going to pay our bills, we have been down to less then £1 in our bank account so please don't think I/we have not been broke. Working overtime and working two jobs is how we got by, money not burning a hole in our pocket meant we saved when we could. My children were brought up on jumble sale and car boot stuff. Unless things were interest free credit if we did not have the money we saved for it. I have never had a new car or motorbike.
My last house cost us more to do up then it was worth when we got it but was supposed to be our forever home. Just checked the net, the house we sold in 2001 for £186,500 sold in 2019 for £490,000. A house we bought for £33,000 and sold for about £65,000 is now selling for about £350,000 this is what the house next door sold for in January, this is one way how people move up the property ladder, inheritance is another.
House prices vary across the country and we moved to a cheaper area.

While some people buy to rent, some buy and fall into renting. Two people have their own property and move in together. In case it does not work out the other house is kept and rented out.


macafee2

No idea about other areas, but around this part of Northamptonshire there are thousands of new houses being built. Where I live in Corby, was just fields around 15 years ago, there's now over 1000 homes here with a primary school. Just up the road in Weldon there's a bigger development going on, I believe there will be Dr's, primary school and other things there, as well as a new secondary school just over the road. Across the other side of the Stamford road there's another big development, Priors hall park, again with school and shops. Oakley vale on the other side of Corby is a massive sprawling estate built by various developers. It includes Dr's, shops, pub, takeaways, 2 primary schools, a nursery, a secondary school, and lots of green space and parks.

Theres also been several smaller developments around the town on all sides, with 2 new supermarkets built in the last 5ish years.

Down the road in Kettering there is also a huge amount of new houses going up on all sides of the town. A little further away in Raunds, it can't be far off being 1/3rd bigger than it was when I moved up here 10 years ago. The same in Northampton, I'd not been down to part of it for a few years, until last week, when I found myself in a whole new part of the town with thousands of houses.

As for the prices, I bet there are a number of people who were completely happy with their houses, until they had to spend months on end in them during the lockdowns. Then quickly discovered that they wanted more space, bigger garden etc.
We were lucky that we managed to move 7 days before the lockdown started, to a much larger house, with enough room for us all to have our own space, kids have a bedroom each and a separate lounge and playroom. If we'd been stuck in the old house, all sat in the same room, and the kids sharing a bedroom, it would've been a lot harder.

On the subject of prices, they increase and fall, and its always a risk you take. Where we are now, the original owner paid £249,950 in September 2008. The next house of the same type to be sold was 6 months later after everything crashed, and was only £185,000. We bought our 1st house for £159,000 in 2013, sold it for £195,000 in 2020, and bought the current house for £250,000. So in the 12 years the previous owner owned our house, he made £50. Judging by how house prices in this area have increased over the last year, we'd probably get about £300,000 if we were to sell now, but whatever else we bought would've increased by the same.

Much the same as the people selling their car to WBAC and similar because they're offering more than they paid. But whatever car they replace it with has also increased.

Do you have any idea who the biggest owner of land is in the UK?, I'll give you a clue... they have big guns.

Landowner Acreage owned in England Acreage woodland
Forestry Commission 489,814 414,293
National Trust 474,641 84,433
MOD 397,098 60,311
Crown Estate 264,233 (landward acreage only) 40,558

what about the church I thought they had a fair bit of land and property?

macafee2

You didn't upset or offend me Ian and I am glad you have found somewhere that meets your needs and are now settled.I was just making the point that this 'Gazumping' happening across the UK has a knock on affect right down to basic starter homes which become out of reach for many first time buyers.You were in the fortunate position of having sold a property in the south were then able to buy something of far better value for money further north,but in other cases where people want to move locally it again pushes those properties out of their price range.Your new house would have been professionally valued by an estate agent so that should have been the asking price and no more.It would be one thing if those with the deepest pockets only fought among themselves but their actions have serious consequences all the way down to starter homes.I would bring in legislation that properties could be sold for no more than the asking price with an intention of being fair to all.


I mentioned earlier that the government have fueled this housing boom with record low interest rates and stamp duty holidays,the real culprit is the lockdowns which created so much pent up demand.

Would that force the initial selling price up?
We put our first offer in not knowing what other offers if any there had been. The estate agent came back to us asking for our best and final offer advising he had other offers in the same area. We decided to up the offer. I dont think guzumping took place as no offer was excepted and then new offers put in... as far as I know.
We wanted to move, lockdown got in the way but you seem right, lockdown has got others moving due to lack of space, too much noise what ever and they are moving out of town.


It is difficult, I understand you and I hope you can understand where I am coming from. Your suggestion would perhaps help some but not others.

The one or both of the Channel Islands I think have a rule or at least did have a rule, could not sell to non island born people.

Estate agents, surveyors, solicitors, moving companies all coined the money in and then what about the building / DIY trade, all these people moving into houses and looking to do work to them. I have to hope that should I ever move I can recover not only the purchase price but money spent on the property


macafee2

My 2 penny worth (probably not worth that!). "Afordable" houses at the planning permission stage usually reduce in numbers when paper comes to bricks and mortar. After the first folk have bought an Affordable house it goes on the open market at "un-affordable". There is regularly a bit in Private Eye about property in the UK being bought by those who do not live in the UK through tax havens and avoid stamp duty or whatever. We are host to a large number of immigrants for whatever reason they come here; financial, persecution in their home country etc but the UK is a densely populated over crowded island and I dont think more folk are really needed. There have been complaints about losing cheap labour with BREXIT but cheap labour/low wages removes the incentive to automate etc. Before Covid a lot of firms "needed" people to work in offices; may now work from home. This could develop into a long ramble but think the gist is clear. Those who complain there are not enough folk to pick asparagus etc should get out there and do some picking or get busy with a harvester design. A long toem ago a combine harvester had a driver, 2 men on the back bagging the wheat/barley or whatever. The sacks were then dumped on the ground and a tractor with driver, two on the trailer and two on the ground collect the bags. Now its just a combine driver who discharges the grain into a trailer.

Under normal circumstances it would not raise the initial valuation,but these are not normal times.If the estate agents had believed they could get away with bunging an extra 50K on the price they would have done it.I believe they were as surprised as the rest of us at the demand created by people not being able to move during the lockdowns.I certainly didn't hear about people outbidding each other and paying way above the asking price pre covid.
Every cloud and all that if you are an estate agent :D

So that says it all then, not much has changed since the Norman invasion, no wonder people have nowhere to live, afterall the Crown need more than a quarter of a million acres of land in order to do their weekend deer hunting.

What an excellent post.

The point the OP is trying to make, and making in point of fact is that the housing market is artificially propping up a broken economy, spiralling into chaos, and orchestrated by an incompetent government, headed by an unelected PM, who has mislead the country into the disaster that is Brexit. Utter maddness, meanwhile our younger generation are wasting their lives chacing a shadow, never likely to be able to afford to buy a home, this is how societies dissolve and dissappear, that is the point, just wondering if anyone else had a differing opinion, that is it.

Could you clarify for me how old the younger generation are?
I thought Boris "won" a general election.
I thought the vote for Brexit was taken before Boris was pm.


macafee2

As a Midlander, I went to work in the southeast (not London) after University in 1970 and despite a "cheap" mortgage available from my company (Legal & General), I realised that I could not hope to buy in that area, so worked on a plan to return to the Midlands, which I did in 1978.

Today's problems are no different. Pure supply and demand in varying areas of the country, and until the population comes under control, it will never be resolved. Climate change is no different - 30% of the world's population born THIS century.

It is more than supply and demand.

Look at the willingness of banks to lend money. Often too much, to people who cannot afford it.

Blair and Brown rocketed house prices from about 2001-2007. They removed housing from the official inflation measures, so claimed we could keep rates low. The UK economy looked marvellous as people with houses were borrowing money against them to spend on nonsense.

I never understood why housing should need to be provided by the state. Surely. private rents could cover this? Of course, another crime of the last 30 years is housing benefit (now LHA) which also inflates rent and house prices.

I wish prices would divide by, say, five overnight. Then my kids might be able to buy one.

Big mortgages are silly... It would be better for all to enjoy the money!

Yes that is an historic problem, banks are greedy. When I bought my house 21 years ago I rung Abbey National and said how much I needed to borrow, I am self employed and my accountant was ready to back this up. My solicitor rung me 3 days later to tell me he had the money when needed, no checks just sent the money.

Now the opposite, I was looking at a new van earlier in the year, I need about £20k. They want guarantees and insurance that adds to cost of the loan, I am going to stick with my old van.

How old are your children and what area would they be looking to buy?
Oh boy, there are a number of reasons why the state needs to provide housing, sometimes temporary and sometimes permanent. Refugees, those to sick to work are a couple of examples, those that lose their home for one reason or another and perhaps cannot get work so cannot afford to rent.
Some say that rental properties add to the housing shortage.
I thought housing benefit was now capped and this had lead to people being evicted as they cannot afford the rent.

If a big mortgage gets you the home you want, is that not enjoying your money? I've driven down a few roads to see the expensive car on the drive yet thought omg what a dive of an area to live. People enjoy their money differently. The car is much more obtainable then a house when funds a re limited.


macafee2

Well put, I deliver to a customer who always seems to have a new car but the house he lives in obviously needs some work, what amazed me the most was he does not have a 3 piece suite but has garden furniture in his living room and the biggest TV I have ever seen.

Its like the people who smoke a packet of fags every day, drop into the pub for a couple of pints after work most days yet cant afford to feed or cloth there children. Some of use waste huge amounts of money on our hobbies but at the end of the day its your money and you do with it what you want. The bit that annoys me is the people who claim to be broke because they waste what they do earn and then look for handouts from the government and other organisations.

Came to this a bit late so I hope I'm not repeating anything.

The purchase price of property doesn't matter, it's the repayment details that do the deciding for a generation that lives on credit. It overtakes all other factors in the equation.

The rates of interest on mortgages are largely irrelevant over 25 years. Anyone remember when rates were 15%? The rates on offer are not just a result of the housing market variations (there is no such thing) and there are probably five different periods of varying affordability in that time. That's why 'the market' picks up when rates are low.

Personal standings vary probably just as much. Interest rates are entirely dependent on the availability and cost of lenders borrowing capital on the international markets.

It's the BIG BOYS that control it - according to the amount of land made available by landowners. Across the spectrum of the economy, this bears very little reflection of the true value of any asset. Those levers are carefully guarded.

Anyone see that news clip about the painting by Banksy that auctioned for £18 million? As the hammer went down the picture which was mounted on a trick frame, dropped down to be destroyed through a shredder. By contrast, houses are bought with desperate emotion.

Many people equate a personal desire with a mistaken idea of an enhanced social approval growth, hence Semi/Detached/Landed/Post Code and borrowing- to-the-hilt (and speculating above that).

I forget who said: 'It's the economy, stupid!'

When it comes to terraced, semi or detached have you considered the noise transmitted through the walls into the adjoining property or from one garden to the other and some may therefore desire detached with land for the piece and quiet?

Does 10 acres and a 4 bed detached worth £500,000 trump 3 bed terraced worth a million? For me it does due to piece and quiet from neighbours.

macafee2

I dont have 10 acres and I did not pay £5000,000 for my house

Oh yes :mad:.

And the massive number of folks with serious negative equity.

And the folks with the cast iron guarantee that the endowment mortgage would absolutely, definitely not only pay off the mortgage buy deliver a tidy lump sum as well - but not in writing ;).

Ah, the lessons of history.................

But have we learned the lesson?How much longer will interest rates remain so low?

Do you seriously need clarification of what constitutes the younger generation? I am sure there is an definition somewhere, that is not the point, a society which is incapable to consider the well being of its people is doomed to failure and decline, it may take a long time but it will happen.
We need leadership, and statesmanship from our elected representatives, we need urgently a full reappraisal of the needs of all the people of this nation, good quality affordable housing is essential, and needs to be addressed NOW, I am saying that all governments have ignored the problem of poor housing, not fit for human habitation, and the spiraling cost of what is available, made worse by the inability to coordinate a policy which allows for the building of much needed housing.
I am saying that there is a complete lack of interest in resolving this problem by the present government because of conflict with landowners who fund it, and because an inflated housing market props up the failing economy.

Personally, if I were a young man, with two university degrees in my pocket, and a professional career in the making, I would be looking elsewhere for my living, not the UK, I wouldn't like it but I would still do it.

Couldn’t agree more, the so-called housing ‘market’ is screwed (there are other words one could use) heavily in favour of the landowners/developers/
financiers. These are the ones that move in similar circles of mutual benefit irrespective of party loyalties (and not necessarily drinks parties!) It’s the biggest ‘mutual’ industry in the country.

It has precious little to do with the needs of the people or societal aims – merely the continuance of the profit turnaround in the interests of the wealthy. I was part of it (on the finance side but not the wealthy!) for 25 years through the whole political cycle and at all levels. Not that I’m cynical, of course.
'
The trouble is, it is the same everywhere and the vested interests make sure of it. Much is made of the level of consumer protection but the whole thing is illusory, that’s only the transfer of the money aspect and nothing to do with the social needs, rather the Lenders' objectives. The motto is: is there a market NOW, and will it Sell. And that applies under every colour of government.

There’s nowt wrong with profit, but the game is loaded too much one way on an already sloping pitch. Remember council houses? When houses were built on the basis of a genuine need? As opposed to naked profit? In spite of our size, the one thing we are not short of is Land. It’s not a question of Right or Left, it’s preparation for a new generation of wealth producers.

It is a lot easier to discuss a subject with someone when you know their criteria, for some reason you decided not to answer the question, that is not helpful. So, another question, why would you seek to work abroad?

macafee2

I’m the same, if I was a young man I’d be in OZ. I don’t think this country will be sorted in my lifetime.

They are under 12, so not for a while yet. But I cannot see how it will be possible. Even in the north east where I am!


I don't see why the state needs to be involved in provision. If we don't eat, we will die, yet the state doesn't run the supermarkets. Indeed, I suggest they would be grim places if they did.

Refugees? Do we get many Irish or French fleeing war?

Housing benefit cap is a political joke. They are given discretionary payments to cover the gap. Get yourself five kids by different men and you can have a huge house paid for by the hard work of others. The benefit calculations are banded and based on average rents, so there is a never ending game of raising the rent, then the benefit etc.


Oh yes, it is better than a car, but it is still dead money. If houses crashed 90% in value, I think it might benefit more people than it hurts...

Lots of time for them to get a job, starting with a paper round or Sunday job. At 15? my daughter had 3 jobs, at 27/28 she had 3 jobs. She goes back to work in a month or so, she will have 2 jobs. The decision your children and you make about them working may have ramifications for years to come.
Going back 38 years my wife and I had about £22,000 in savings, we were 20 and 21, out first house was £33,000.
Found this on the web "Of people between the age of 22 and 29 years, about 40% have no savings at all, while around 10% have savings between £2,000 and £3,000. Only around 25% have saved more than £6,000"
The point I am trying to make, if people work and save but cannot afford then they have the right to complain, if they don't do either or both then don't moan they cant afford, now there will be exceptions, sick, low paid being 2



French and Irish, interesting.
You have decent honest foreign people fleeing their home countries due to fear that may not be able read, write or speak English, how on earth are they going to live a legal life and support themselves? OK, this example dates back years but German Jews came to the UK round about 1938/39, what would you have done with them? Left them to their fate or given them a safe place of refuge, a hot meal and a roof over their head? History tells us what happened to an awful lot of them.
Now we have the situation with Afghanistan.
I get the feeling you are thinking about those that want to sponge off the state while I am thinking about those that want to work and lead a decent honest life, alas, amongst the group of refugees there will no doubt be bad apples


They state should be there for those that truly cannot manage, low pay, sick and some may have lost everything due to splitting from partner and then paying child maintenance or partner dying and no income.
Rent does rise in some cases every year but costs can too.
For a lot of people as it may already have been said, the value of a home is meaningless until you come to sell or borrow against it or you want bragging rights.


macafee2

Hmm, I think that 40 years ago, over 20k in savings would be unheard of (round here!).

It get the impression that the older generations (who have done well with property and pensions) simply don't understand how bleak it is for someone in their 20s. I appreciate that some need a kick up the backside and to drop their PCP cars, iPhones, coffees, gym subs etc. But the housing numbers are way out... A 20k deposit would be good (hard with a 50k student debt!) but to borrow three times your earnings would give you a bit over 100k for an average job... But an average house is over 2.5 times this amount.

I notice with 'refugees' that those who virtue signal the most tend to not be impacted. I find it hard to see how the UK is their first safe country.

I think the point I was trying to make is that people don't have the savings to start with. If you are trying to get a house in London, god help you. If you are trying to get a house in some other parts of the country and I don't mean in the middle of now where with no transport links etc it should not be a problem, 3 bed semi under £180,000.

Lets introduce the bank of mum and dad, for some the bank is there, for others it is not. I know a few people that have inherited, one couple gave their son a house they inherited, another has nothing left of £250,000, their son did not benefit, the money was just spent.


macafee2

UK house prices I think are largely based on a ponzi scheme which is being passed off as one of supply and demand. The scheme effectively went bust with the financial crash in 2008 which, contrary to what the culpable would prefer people to believe, was seen coming by some analysts. Seems like only yesterday that some of the expenses fiddlers were scurrying down Westminster streets trying to evade reporters while uttering things like putting money into banks is no different to putting money on a horse. That went down well, what not, with pension providers who had regarded banks as extremely safe blue-chip investments and the likes of local councils who thought that their millions in reserves were safe in a bank - as safe as, well, err, houses.

There was a wobble in the housing market at the time but not a crash because to save their own faces, positions and nice little earners the culpable in the uk merely deferred it. But it is not sustainable to borrow and to print funny money forever plus savers cannot be squeezed for what they no longer have or no longer entrust to a bank - banks which some still regard as safe as houses but for utterly different reasons, lol. America did let the crash happen and in so doing ensured that those affected fell from a lower height. China's got a massive problem atm with its housing market. About, I think, 90 million empty properties and some huge new-builds demolished before completion when the business model collapsed. Many of its people bought off-plan and have lost their money as things stand atm. China's day of reckoning has arrived in its housing market and it will be interesting to see how they deal with it and its global effect. :eek:

Housing

In housing, all that matters these days is the market. The land owners and the builders are in the business for the long term and the owners only sell their land when the price is right. Then the financiers are in it for as long as it takes to make killings. In the toothy grin of profit the market is malleable and king. Naturally, it is all legal and above board.

What is missing is the supply of rented properties in the control of councils. That’s council houses. For many years the building of communities and the social benefits from that ‘social class’ meant those in lower income brackets could get at least one foot on the ladder of a home for the family.

That was not subject to the whims of the industry and councillors new they had to toe the line or suffer the consequences. It was a stable market; families could be confident they were safe and the gambling on market fluctuation was irrelevant. Quality of construction was subject to law and standards were usually good.

Then a government enabled, in the name of eventual perceived profit, the sale of this so-called ‘social housing’. All those families that experienced hardship, for a variety of reasons many of them sound and valid, now had not got entry into proper housing and had to rely on private landlords.

Not all landlords were mercenary of course but also none of them are in the business to make a loss.
Sometimes progress isn’t.

I fear that you fellow peasants are failing to appreciate the direction of travel insofar that the housing market and property ownership is concerned.

At the moment, roughly 5% of the UK population are in the £1m asset/savings category and about 2% in the super-rich category. These 2% derive vast incomes from their multi-million assets. I see us moving towards 100-year mortgages (as in Japan) where a person hands down his home and associated mortgage at death.

Beyond that, ultimately, I see that all property will be owned by the top 2%, thus securing relatively high and stable long-term returns whereas we peasants (the masses) will be long-term tenants. Welcome back Victorian demographics.

Rees-Mogg dresses as he does knowing our and his destiny!

I seem to recollect reading that he Crown Estate is 85% owned by the government, or 85% of the income from the estate went to the government. One of our previous monarchs was bailed out by parliament and that was their price for the rescue.:shrug:

very surprised it is only about 5% of the UK population is worth a million, but looking at the internet you are indeed right.

macafee2

Thing to remember about those "worth a million", is that some are asset rich and cash poor. It is the second million of worth that is the difficult part.

House prices appreciating is more to do with currency depreciation and financial manipulation than actual capital appreciation.
Each time interest rates dropped, that guaranteed that house prices would go up. I read that there could be as many as 1 million interest only mortgages out there. It's amazing how high a bid you can put in if you have access to a large loan at a very low rate. The only way though for most of those folk to pay off their mortgages will be to downsize and hope the sale price has enough 'capital appreciation' to afford a house somewhere in the UK. If you were lucky/clever enough to buy in London thirty years ago you can move pretty much anywhere and have change left over. Not so much if you bought in many other areas.
With our current two party 'democracy', candidates for government get elected by outbidding the other candidates with the most appealing promises. Over promising leads to overspending which leads inevitably to overborrowing. Usually a conservative government tries to balance the books by applying fiscal prudence. They get accused of 'austerity', become unpopular and get booted out. Labour usually loosens fiscal policy, confuses investment with divestment, sells our gold for $300/ounce and leaves a note saying there is no money. Incredibly, despite there being no money and no magic money tree (Teresa May to the nurses ), Boris has thrown all caution to the wind and found £500 billion somewhere. Even more incredibly, after announcing £94 billion in improvements to the rail network, it's labelled ' not enough'.
We are heading inevitably for inflation well above the Bank of England target rate of 2%. Labour would be well advised to take a rain check at the next election, because the chickens will come home to roost in 2024-25, and the new government will have a rather large poisoned chalice.
It is inflation, compounded annually, which inexorably drives up the cost of housing and simultaneously depreciates the spending power of a currency. This in turn inexorably batters down the poorest and most vulnerable in our society. Why not target 0% inflation and stable prices? Letting inflation rip is dangerous. The most modern example of inflation spiralling out of control is of course Venezuela, lauded not that long ago by Mr Corbyn et al as a great modern example of what a socialist economy can achieve.

Well, the socialist govt of Clement Attlee did build over 1 million houses 1945 - 1951 when we were supposed to be bankrupt. Not bad going.

This government had done everything possible to maintain house price inflation, including the use of tax payer's money to do so through the stamp duty holiday.

If I was leader of the Labour party, I would take a little step back at the next election on the basis that having made an excellent job of managing the Covid situation, the Tories deserve to reap the fruits of their successes and be given the opportunity to do the same for the economy over the following term. :laugh:

Thanks Martin (Edwardmk) for post 45. May I add?

The one thing that's missing, to bring a bit of levelling up in a grossly exaggerated market, and to alleviate family hardship, is a return to the building of council houses. But without the wholly unnecessary Right to Buy. There is so much derelict ex-industrial wasteland in this country it's embarrassing. Incredibly cheap as well.

Absolutely correct.We now have a housing market with hugely over inflated prices offering poor value for money.These reckless actions have pushed home ownership even further out of reach for most first time buyers.It has also had a knock on effect in the rental market where prices are frankly obscene due to high demand.Renting is the only option for many as both the deposit for a mortgauge,or ridiculously high asking prices, have pushed ownership beyond their means.Well done Boris and co.

I don't disagree with socialism, I support it, but it can't exist without entrepreneurs producing more than they need, which is where capitalism comes in. Ted Heath referred to the 'unacceptable face of capitalism', and there are many unacceptable faces that I can see operating which I'd love to see reformed or stopped completely. However, as Margaret Thatcher once said, the problem with socialism is that eventually you run out of other peoples' money. I think the debate about where the correct balance lies is where the differences and frustrations occur.
Imho, with my great benefit of hindsight, she was wrong to sell off council houses. And the 'right to buy' them has to stop if there is ever going to be sufficient council housing in the future.
How many council houses could we have built with the £400 billion poured into 'fighting Covid' thus far, and does it truly represent value for taxpayers' money in the longer term?

Good, permit me a slight diversion. Central America is renowned for corruption and unstable governments. Costa Rica is a notable (socialist) exception. After many civil wars in 1949 there arose a most enlightened president who said the only way to stop wars is to do away with the army. The 10% spent on the military was then devoted to education and health. When we flew to Costa Rica a few years ago we sat next to an ill young man who was going there for stem cell research. Today they are the greenest country in the world with more than a quarter of the country devoted to National Parks. (Much of Attenborough's films are made there). Everyone was given the vote and today they enjoy a higher educational standard than the US of A. They are lovely people - not perfect - but we can learn a lot from them. Go there if you can.
End of lecture.

For some reason the mention of Costa Rica set off alarm bells.
https://www.gov.uk/foreign-travel-ad...y-and-security

Not sure when the web page was last updated but it paints a different picture.

macafee2

Reading the page it appears better than some parts of the US.

When I used to go over to the US regularly, I remember some of the Americans being shocked when I told them I had taken a walk through a park not far from Millionaires mile in Chicago. I was advised not to do so for my safety!