The Government's new home ownership scheme.
Discussion
crankedup said:
I take the view that some artificial interference is urgently needed to stimulate the market, doing nothing will drag prices down its true, perhaps thats a good thing? but the amount of time this 'natural adjustment' will take is just not available, we need growth right now and this is one way of achieving that. I see I am alone in my thinking on this but for once I agree with Government thinking.
How much more artificial interference is needed - perhaps the Government need to let the correction happen - that is the best way to get FTBs back into the marketAs a potential First time buyer, I wouldn't consider it.
There is no way I'm going to purchase a poorly built s
t tip that these new builds tend to be.
They throw these houses up with out proper consideration of the infrastructure required to support them. New builds behind my parents place in Warrington are shocking. I wouldn't touch one if I was offered 100% mortgage.
There is no way I'm going to purchase a poorly built s
t tip that these new builds tend to be. They throw these houses up with out proper consideration of the infrastructure required to support them. New builds behind my parents place in Warrington are shocking. I wouldn't touch one if I was offered 100% mortgage.
MorrisCRX said:
As a potential First time buyer, I wouldn't consider it.
There is no way I'm going to purchase a poorly built st tip that these new builds tend to be.
They throw these houses up with out proper consideration of the infrastructure required to support them. New builds behind my parents place in Warrington are shocking. I wouldn't touch one if I was offered 100% mortgage.
Agreed. I'm also renting with half an eye on buying (nowhere near enough cash for a deposit) but new builds are often shockingly poorly built. Having said that, I can't stand the fact that I'm putting £775 pcm in to my land lords mortgage each month. Particularly as its a relatively small 1 bed flat!There is no way I'm going to purchase a poorly built s
t tip that these new builds tend to be. They throw these houses up with out proper consideration of the infrastructure required to support them. New builds behind my parents place in Warrington are shocking. I wouldn't touch one if I was offered 100% mortgage.
I'm stuck, with few options!
paps said:
Agreed. I'm also renting with half an eye on buying (nowhere near enough cash for a deposit) but new builds are often shockingly poorly built. Having said that, I can't stand the fact that I'm putting £775 pcm in to my land lords mortgage each month. Particularly as its a relatively small 1 bed flat!
I'm stuck, with few options!
This scheme is exactly for people like you, try and embrace if your that stuck . It sucks being a rental I'm stuck, with few options!
scotal said:
No it won't.
Mortgages are easier to obtain on existing /second hand/used/preloved homes
Your comment makes no sense. Of course it's much "easier" to save £10,000 (5%) to buy a new £200,000 house then it is to save £40,000 (20%) to buy an older £200,000 house! Mortgages are easier to obtain on existing /second hand/used/preloved homes
Theoretical mortgage availability is completely irrelevant if you haven't got the real-world cash to pay the high deposit demanded.
Derek Chevalier said:
crankedup said:
I take the view that some artificial interference is urgently needed to stimulate the market, doing nothing will drag prices down its true, perhaps thats a good thing? but the amount of time this 'natural adjustment' will take is just not available, we need growth right now and this is one way of achieving that. I see I am alone in my thinking on this but for once I agree with Government thinking.
How much more artificial interference is needed - perhaps the Government need to let the correction happen - that is the best way to get FTBs back into the marketWe are in new untested water now and as with other Government measures they must act to get the economy moving again, and fast.
crankedup said:
Derek Chevalier said:
crankedup said:
I take the view that some artificial interference is urgently needed to stimulate the market, doing nothing will drag prices down its true, perhaps thats a good thing? but the amount of time this 'natural adjustment' will take is just not available, we need growth right now and this is one way of achieving that. I see I am alone in my thinking on this but for once I agree with Government thinking.
How much more artificial interference is needed - perhaps the Government need to let the correction happen - that is the best way to get FTBs back into the marketWe are in new untested water now and as with other Government measures they must act to get the economy moving again, and fast.
frosted said:
paps said:
Agreed. I'm also renting with half an eye on buying (nowhere near enough cash for a deposit) but new builds are often shockingly poorly built. Having said that, I can't stand the fact that I'm putting £775 pcm in to my land lords mortgage each month. Particularly as its a relatively small 1 bed flat!
I'm stuck, with few options!
This scheme is exactly for people like you, try and embrace if your that stuck . It sucks being a rental I'm stuck, with few options!
crankedup said:
Ari said:
crankedup said:
Had this discussion recently on another thread. Builders have huge land banks and only release them for building as it suits them, obviously to maximise their investments. This in turn flows through to the sale price of new housing, high demand/shortage of product = high price.
All fine and well, but that's not the end of the story. Builders can charge what they like but if people can't afford, people won't buy. Likewise, they have to be competitive with secondhand homes or buyers won't buy. A government attempting to prop up the market with new home incentives and cheap finance via low interest rates just staves off the inevitable and does no one any favours.
crankedup said:
I take the view that some artificial interference is urgently needed to stimulate the market, doing nothing will drag prices down its true, perhaps thats a good thing? but the amount of time this 'natural adjustment' will take is just not available, we need growth right now and this is one way of achieving that. I see I am alone in my thinking on this but for once I agree with Government thinking.
Yes but that "growth" is on the back of borrowed money (not many FTBers are buying outright). So all you're doing is stimulating the economy on the back of borrowed cash, exactly what got us in this mess!frosted said:
On average new builds are 15% more expensive than second hand , why the GOVERMENT is backing up this scheme is beyond me. If you do it , do it right and offer it for all properties ffs
The principal aim of such a policy must be to stimulate the construction industry, offering it on all properties wouldn't achieve this.Rude-boy said:
Would stop a lot of people with £40k-60k buying up sub £125k properties on BTLs as it is a better way to use their money than buy a bigger house that they then have to pay out £9k on SDLT for.
Do you think so? I suspect they'd still buy the cheaper properties for BTLs because (1) two £125k properties rather than one £250k property gives you diversification so better protection against voids; (2) cheaper rental properties are more in demand from people who can't yet afford to buy; and (3) the yields appear to be better.frosted said:
JagLover said:
The principal aim of such a policy must be to stimulate the construction industry, offering it on all properties wouldn't achieve this.
Because the most people want to move but are stuck , 5% deposit on all properties would get things moving again frosted said:
Because the most people want to move but are stuck , 5% deposit on all properties would get things moving again
And never forget the government's idiotic "Moving House Tax". stamp duty at current rates is clearly a significant brake on the market. On top of this the government has chosen to give money to housebuilders rather then free-up the market.You want to sell your existing house and then buy a property for £300,000? That's £60,000 (20%) deposit plus £9,000 (3%) stamp duty. Only £69,000 to find!! No wonder nobody's moving.
frosted said:
JagLover said:
The principal aim of such a policy must be to stimulate the construction industry, offering it on all properties wouldn't achieve this.
Because the most people want to move but are stuck , 5% deposit on all properties would get things moving again Ari said:
crankedup said:
Ari said:
crankedup said:
Had this discussion recently on another thread. Builders have huge land banks and only release them for building as it suits them, obviously to maximise their investments. This in turn flows through to the sale price of new housing, high demand/shortage of product = high price.
All fine and well, but that's not the end of the story. Builders can charge what they like but if people can't afford, people won't buy. Likewise, they have to be competitive with secondhand homes or buyers won't buy. A government attempting to prop up the market with new home incentives and cheap finance via low interest rates just staves off the inevitable and does no one any favours.
crankedup said:
I take the view that some artificial interference is urgently needed to stimulate the market, doing nothing will drag prices down its true, perhaps thats a good thing? but the amount of time this 'natural adjustment' will take is just not available, we need growth right now and this is one way of achieving that. I see I am alone in my thinking on this but for once I agree with Government thinking.
Yes but that "growth" is on the back of borrowed money (not many FTBers are buying outright). So all you're doing is stimulating the economy on the back of borrowed cash, exactly what got us in this mess!For me there is a huge difference between loans for cars,motorbikes, big televisions and other 'keep up with the Joneses nonsense and a home buyers mortgage.
Doesn't matter, the money is still being sucked out of the economy and into the banks for years and years.
How else do I expect people to be able to fund a home? Simple, by virtue of property prices dropping back to a level whereby people can actually afford them!
I don't understand why that's such a hard concept to grasp. It's happened before, many times. In the early nineties I bought my first house, a three bedroom terraced, for less than friends of mine had paid for tiny one bed flats only a few years before at the height of the eighties property price boom.
And I can remember, when friends with more income were diving to get onto the "one way" property ladder thinking "that's it, I'm priced out forever", just as so many are thinking now.
The trouble is that whilst the government are desperate to prop up house prices by whatever means necessary (stupidly low interest rates being the obvious one, schemes like this being another), everything stagnates and nothing happens.
Once interest rates normalise, then we'll see what houses are really worth, and anyone dragged in to purchase at close to peak price via schemes like this will suffer as they go straight into negative equity.
How else do I expect people to be able to fund a home? Simple, by virtue of property prices dropping back to a level whereby people can actually afford them!
I don't understand why that's such a hard concept to grasp. It's happened before, many times. In the early nineties I bought my first house, a three bedroom terraced, for less than friends of mine had paid for tiny one bed flats only a few years before at the height of the eighties property price boom.
And I can remember, when friends with more income were diving to get onto the "one way" property ladder thinking "that's it, I'm priced out forever", just as so many are thinking now.
The trouble is that whilst the government are desperate to prop up house prices by whatever means necessary (stupidly low interest rates being the obvious one, schemes like this being another), everything stagnates and nothing happens.
Once interest rates normalise, then we'll see what houses are really worth, and anyone dragged in to purchase at close to peak price via schemes like this will suffer as they go straight into negative equity.
Ozzie Osmond said:
And never forget the government's idiotic "Moving House Tax". stamp duty at current rates is clearly a significant brake on the market. On top of this the government has chosen to give money to housebuilders rather then free-up the market.
You want to sell your existing house and then buy a property for £300,000? That's £60,000 (20%) deposit plus £9,000 (3%) stamp duty. Only £69,000 to find!! No wonder nobody's moving.
SDLT didn't act as a brake on the market before though - so whilst it is another cost to find it is the same percentage cost as it was before.You want to sell your existing house and then buy a property for £300,000? That's £60,000 (20%) deposit plus £9,000 (3%) stamp duty. Only £69,000 to find!! No wonder nobody's moving.
Deposit percentages are now higher than they were but your example assums that there is no equity in the house that is being sold which is the case for some people but not all.
Doesn't change the fact that this scheme is a pointless one which will achieve bery little.
There is also the Government's gift to people living in council houses of up to £75ks worth of equity in their houses via the right to buy discount. Why is that a good idea?
frosted said:
Because the most people want to move but are stuck , 5% deposit on all properties would get things moving again
No, realistic property prices would get things moving again, and would have the happy knock on effect of reducing deposits (20% of £100K is a hell of a lot less than 20% of £200K).markh1973 said:
There is also the Government's gift to people living in council houses of up to £75ks worth of equity in their houses via the right to buy discount. Why is that a good idea?
I've never understood the logic to this. It's just giving money away! Sure, they no longer have to maintain that house, but they have to build another to maintain housing stock.A private landlord would never offer a substantial discount to a tenant just because they'd lived there a few years and wanted to buy, so why are the housing associations?
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