When/Will house prices cool down?
Discussion
wisbech said:
Hah - in my (tech) firm, as of last week desks now have QR codes to scan. Supposedly to check in/ check out of your hot desk, but as it came immediately after a blast from the CEO how we were missing out on the serendipity of inter office interactions...
Those interactions are, and will remain, massively important in some industries (especially early on in careers). My eldest was chatting on the way to school the other day about how pleased he is that so many of his peers/older friends of have the general attitude that they’ll live where they like, in sportswear if possible, and work only the hours they’re paid for.
In his view, they’re all choosing to not compete with him for the top jobs. Never seemed to be that interested in office based work, but from the way he’s been recently it really wouldn’t surprise me at all if he ends up in the city for a while.
Man of gas said:
G-wiz said:
supersport said:
Personally I don't understand the desire to work in That London. I used to commute in some 30 years ago, it was s
t.
5 or 6 years ago, a client needed us to be in their offices for a face to face at 9am, somewhere in central London.t.Took the train into Paddington, then some underground, starting journey at 07:30 ish.
Once, and never again.
And some people do that several times a week!
Nice to have the experience, though, the suffering that these people face. To empathize.
It's where you store the bike though. That's the only real significant hurdle IMO.
Forester1965 said:
Yeah but kids love branding. Think mine could recognise the golden arches at 600 yards from about 2yrs old.
Yup. Having children has been a true insight into the power of branding on simple minds. 
Mine grew up in one of the only places where a Golden Arches has actually failed and gone yet knew about it from a very young age.
DonkeyApple said:
In many ways the Govt has precision tools to try and stage manage a value stagnation. We saw this in 2011 when some simple changes pushed away some overseas and corporate investment capital by increasing their tax burden and likewise the specific targeting of BTL speculative gamblers by taxing them out. Simultaneously, regulation that had restricted lending multiples to prevent runaway asset inflation and default risk was put back into place.
The Govt could easily deleverage the resi property market via a top down approach to further dial out inflationary pressures driven by non essential borrowing. It could be as simple as lowering the lending multiple as the loan amount increases etc.
Whereas interest rates are a really clumsy tool for trying to curb lending, regulation is a scalpel that can perform some precision operations.
You'd just need to get some FCA employees back into the office and then find some that understood what their job was. After years of operating under Bailey, it's all a bit of a mess over there still.
Good points. Would love to see it, and IMO, the most healthy way to manage house prices. More disposable income in people's pockets is great for the economy so outside of the 'we need housing that isn't cripplingly expensive' narrative, the side effects of that are also beneficial.The Govt could easily deleverage the resi property market via a top down approach to further dial out inflationary pressures driven by non essential borrowing. It could be as simple as lowering the lending multiple as the loan amount increases etc.
Whereas interest rates are a really clumsy tool for trying to curb lending, regulation is a scalpel that can perform some precision operations.
You'd just need to get some FCA employees back into the office and then find some that understood what their job was. After years of operating under Bailey, it's all a bit of a mess over there still.
soupdragon1 said:
People automatically think RAIN. Which is fair comment. I play golf and have lightweight waterproofs in my golf bag at all times. Keeps you bone dry. A set of waterproofs, a good bike - great way to get around even in poor conditions. Takes 30 seconds to get the waterproofs on/off, weigh about 500g and could easily fold up and put into a laptop bag.
It's where you store the bike though. That's the only real significant hurdle IMO.
I cycled into London and out for about 10 years. 15-18 miles each way. Statistically the likelihood of rain in those two hours was actually quite low. Of course it happened by actually fairly uncommon to get properly rained on. It's where you store the bike though. That's the only real significant hurdle IMO.
I haven’t worked anywhere since 2008 that didn’t have bike parking facilities. In some instances they were incredible, a certain liberal newspaper probably the best of the lot. Only one car in the underground car park, a well known editor - at least he drove a smart car.
DonkeyApple said:
If you think about it, that is what is going to happen. It won't be real Londoners deciding to emigrate to the North but fewer young and future successful Northerners emigrating to London for work and lifestyle superior to what they can find closer to home.
It's about 250k economic migrants a year coming in to London from the regions isn't it? The intention of levelling up is to create a better environment locally which will lead to fewer of the best and brightest from running away as fast as they can to somewhere they perceive to be superior/better. Levelling up is ultimately just code for trying to stem the brain drain that blights some regions. And if successful will massively increase house prices and the cost of services, along with rents too.
With respect, reading a lot of your posts, I think you've got a blind spot in your views.It's about 250k economic migrants a year coming in to London from the regions isn't it? The intention of levelling up is to create a better environment locally which will lead to fewer of the best and brightest from running away as fast as they can to somewhere they perceive to be superior/better. Levelling up is ultimately just code for trying to stem the brain drain that blights some regions. And if successful will massively increase house prices and the cost of services, along with rents too.
You're clearly (like many on here) intelligent, professional (in a broad sense) and successful.
...but the content of your posts focuses on the impacts on / behaviours of like individuals - fellow "successful professionals", almost. And you don't seem to consider at all the remaining 80% of society. People who have all the same fears and hopes as you and I, people who are still essential* to the successful running of society and economy, but have had notably less in the way of opportunity** and who don't deserve to be ignored.
* I'm happy to ignore the underclass here who don't really contribute, but they're a smaller % than you think.
** Yes, that is true. For all sorts of reasons, from family upbringing, to the sort of school they were sent to, to the fact that they might have been the 'ignored centre' at school - not gifted enough to be top of the class, not a grafter enough to get noticed, not at the bottom and needing attention to avoid damaging the statistics, just easily glossed over by the lazier or more over-worked teachers. And worse - when they left school, did they get any proper career advice? Did they realise there was a whole world out there open to them (in this instance "if only they just moved to London")? Did they wind up with a family younger than planned because of accident or ignorance?
havoc said:
With respect, reading a lot of your posts, I think you've got a blind spot in your views.
You're clearly (like many on here) intelligent, professional (in a broad sense) and successful.
...but the content of your posts focuses on the impacts on / behaviours of like individuals - fellow "successful professionals", almost. And you don't seem to consider at all the remaining 80% of society. People who have all the same fears and hopes as you and I, people who are still essential* to the successful running of society and economy, but have had notably less in the way of opportunity** and who don't deserve to be ignored.
* I'm happy to ignore the underclass here who don't really contribute, but they're a smaller % than you think.
** Yes, that is true. For all sorts of reasons, from family upbringing, to the sort of school they were sent to, to the fact that they might have been the 'ignored centre' at school - not gifted enough to be top of the class, not a grafter enough to get noticed, not at the bottom and needing attention to avoid damaging the statistics, just easily glossed over by the lazier or more over-worked teachers. And worse - when they left school, did they get any proper career advice? Did they realise there was a whole world out there open to them (in this instance "if only they just moved to London")? Did they wind up with a family younger than planned because of accident or ignorance?
Not exactly. When talking about taxation, I'll only be referencing the higher paid as I don't believe there is any upside to collecting say income tax from the lower paid. You're clearly (like many on here) intelligent, professional (in a broad sense) and successful.
...but the content of your posts focuses on the impacts on / behaviours of like individuals - fellow "successful professionals", almost. And you don't seem to consider at all the remaining 80% of society. People who have all the same fears and hopes as you and I, people who are still essential* to the successful running of society and economy, but have had notably less in the way of opportunity** and who don't deserve to be ignored.
* I'm happy to ignore the underclass here who don't really contribute, but they're a smaller % than you think.
** Yes, that is true. For all sorts of reasons, from family upbringing, to the sort of school they were sent to, to the fact that they might have been the 'ignored centre' at school - not gifted enough to be top of the class, not a grafter enough to get noticed, not at the bottom and needing attention to avoid damaging the statistics, just easily glossed over by the lazier or more over-worked teachers. And worse - when they left school, did they get any proper career advice? Did they realise there was a whole world out there open to them (in this instance "if only they just moved to London")? Did they wind up with a family younger than planned because of accident or ignorance?
When talking about property values, or cars, I don't see the benefit in that very restricting credit to the lower paid, or more conventional end of the market but see a clear benefit to all of limited credit multiples for bigger ti let transactions. These are luxury purchases and don't have need of credit multiples which are going to raise costs eventually for everyone.
And levelling up is too superficial to just think that it is about giving those at the lower end a better advantage. You need to look beyond at what that success will look like and it will be an increase in higher paid jobs so more money flowing into housing etc and the increasing of property values so then everyone ends up paying more for mortgages and rent due to the increase of higher earners in the region.
That's the irony of 'levelling up'. The more and better low paid jobs the more higher paid jobs which then fuels gentrification and the subsequent outward housing migration due to the ripple effect of increasing values and ultimately, you end up with lower paid workers being paid more but their cost of housing swallowing it all up so they're no better than before other than a fancier view from their living room window.
It's not about ignoring the 80% at all but focusing on the 20% and their impact on that 80% by proxy.
DonkeyApple said:
Not exactly. When talking about taxation, I'll only be referencing the higher paid as I don't believe there is any upside to collecting say income tax from the lower paid.
When talking about property values, or cars, I don't see the benefit in that very restricting credit to the lower paid, or more conventional end of the market but see a clear benefit to all of limited credit multiples for bigger ti let transactions. These are luxury purchases and don't have need of credit multiples which are going to raise costs eventually for everyone.
And levelling up is too superficial to just think that it is about giving those at the lower end a better advantage. You need to look beyond at what that success will look like and it will be an increase in higher paid jobs so more money flowing into housing etc and the increasing of property values so then everyone ends up paying more for mortgages and rent due to the increase of higher earners in the region.
That's the irony of 'levelling up'. The more and better low paid jobs the more higher paid jobs which then fuels gentrification and the subsequent outward housing migration due to the ripple effect of increasing values and ultimately, you end up with lower paid workers being paid more but their cost of housing swallowing it all up so they're no better than before other than a fancier view from their living room window.
It's not about ignoring the 80% at all but focusing on the 20% and their impact on that 80% by proxy.
I’m not saying I disagree with your points. And feel free to tell me to mind my own business, but where’s your head at an impeding election? I read a lot of your posts and enjoy your thought process and assessments, and presumably take that you have a traditional conservative viewpoint. But surely it’s time at the bar for the current landlord?When talking about property values, or cars, I don't see the benefit in that very restricting credit to the lower paid, or more conventional end of the market but see a clear benefit to all of limited credit multiples for bigger ti let transactions. These are luxury purchases and don't have need of credit multiples which are going to raise costs eventually for everyone.
And levelling up is too superficial to just think that it is about giving those at the lower end a better advantage. You need to look beyond at what that success will look like and it will be an increase in higher paid jobs so more money flowing into housing etc and the increasing of property values so then everyone ends up paying more for mortgages and rent due to the increase of higher earners in the region.
That's the irony of 'levelling up'. The more and better low paid jobs the more higher paid jobs which then fuels gentrification and the subsequent outward housing migration due to the ripple effect of increasing values and ultimately, you end up with lower paid workers being paid more but their cost of housing swallowing it all up so they're no better than before other than a fancier view from their living room window.
It's not about ignoring the 80% at all but focusing on the 20% and their impact on that 80% by proxy.
pb8g09 said:
I’m not saying I disagree with your points. And feel free to tell me to mind my own business, but where’s your head at an impeding election? I read a lot of your posts and enjoy your thought process and assessments, and presumably take that you have a traditional conservative viewpoint. But surely it’s time at the bar for the current landlord?
My gut feeling is that many in the middle ground who would normally vote Con have little reason to turn out in their droves to vote and many, I suspect, feel there is little downside to a change. I'm generally assuming Labour will win mainly due to voter apathy. Labour have been at pains to try and tell that middle England voter and business owners that they have no plans to tax the crap out of them. Personally, I don't think they have any plans and are just a party that just tells everyone that everything is bad and that they would be better. I don't really see any depth of character in the shadow cabinet that is in any way better quality than their generally shambolic opposite number. What I do see is powerful devolved powers, not just Wales and Scotland but the Mayors such as Kahn and Burnham. I think that they will be tales that way the dog and combined will dominate the Labour cabinet like it's a PH landing. I don't see how Starmer, Reeves or Rainer can stand up to them and their extremist policies and beliefs will dominate. They'll be turbo charged to increase the use of the eco argument to force people out of cars, come gunning for gas boilers and generally be freed to do what they've been trying to do for the last decade but have been held in check by the Con government.
So in short, a Labour win followed by the regional barons taking control by the end of the first term. Happy days.
But they'll be hurling cash at people who will be hurling it at rich people as quickly as they can so time to move into a sin market soon.
DonkeyApple said:
Drive to my middle of nowhere train station around 5am. Park the car in an empty car park, walk onto an empty platform, get into an empty train and go back to sleep. Disembark at a still reasonably quiet Paddington and Tube round to the City........
........Meanwhile, I am taking my children out for dinner tonight to a chain restaurant in a regional town......It's my idea of abject hell. And yet, it is beloved by millions so it is very clearly a 'me' issue
When waking up at before 5am so you can park at a train station and than get to work for 9am is seen as preferable to having to go some where that isn't on the tube map, you sound like every Londoner I know ........Meanwhile, I am taking my children out for dinner tonight to a chain restaurant in a regional town......It's my idea of abject hell. And yet, it is beloved by millions so it is very clearly a 'me' issue
.I get to leave the house at 815am, do the school run, and than cycle to work from the school, usually am at the desk before 9am. But it's pretty hellish to live some where as remote as Leicester!!!
The only reason I'd have to vote conservative is that they're the only party refusing to adopt the absurd definition of Islamaphobia.
Otherwise they are an absolute failure. The housing market suffers the inequality and lack of reform it had when they arrived. Which is ridiculously bad for growth. The last budget was a chance to do something, yet, a boring drab event it was.
The absolute farce of the NPPF review and complete lack of genuine effort to reform the planning system is a reason to want them out. That this gov has known for fifteen years that supply is the issue and has done nothing is a disgrace.
Their handling of COVID and the ridiculous and wholly unnecessary stamp duty stimulus showed again their total lack of either understanding or ability to be on top of live situations.
Yet what's the alternative?
Kier is a bowl of porridge. Unsweetened. The shadow cabinet are a bunch of parrots. Moreover possibly the lowest intellect bunch of parrots I have ever seen sit in opposition.
Has there been a truly smart and energetic government since Blair? Not that I liked him/them one bit but at least they had vigour.
Politics has been on a southward journey for ability and smarts since @2005. I feel it's making the UK an ever worse place by the month.
Levelling up?
Absolute tosh. It's very very simple. You raise the tax threshold. You put more money directly into the pockets of the lowest paid.
Housing bubble taking prices to @9times earnings? You increase supply. You study the issues and work out how to solve it. FFS, the entire country has known about this issue since the mid noughties. They've had long enough. Yet that they persist repeatedly with demand side stimulus absolutely f#+king stinks. It stinks of being rotten.
I'm thoroughly fed up with politics in the UK.
Otherwise they are an absolute failure. The housing market suffers the inequality and lack of reform it had when they arrived. Which is ridiculously bad for growth. The last budget was a chance to do something, yet, a boring drab event it was.
The absolute farce of the NPPF review and complete lack of genuine effort to reform the planning system is a reason to want them out. That this gov has known for fifteen years that supply is the issue and has done nothing is a disgrace.
Their handling of COVID and the ridiculous and wholly unnecessary stamp duty stimulus showed again their total lack of either understanding or ability to be on top of live situations.
Yet what's the alternative?
Kier is a bowl of porridge. Unsweetened. The shadow cabinet are a bunch of parrots. Moreover possibly the lowest intellect bunch of parrots I have ever seen sit in opposition.
Has there been a truly smart and energetic government since Blair? Not that I liked him/them one bit but at least they had vigour.
Politics has been on a southward journey for ability and smarts since @2005. I feel it's making the UK an ever worse place by the month.
Levelling up?
Absolute tosh. It's very very simple. You raise the tax threshold. You put more money directly into the pockets of the lowest paid.
Housing bubble taking prices to @9times earnings? You increase supply. You study the issues and work out how to solve it. FFS, the entire country has known about this issue since the mid noughties. They've had long enough. Yet that they persist repeatedly with demand side stimulus absolutely f#+king stinks. It stinks of being rotten.
I'm thoroughly fed up with politics in the UK.
gangzoom said:
When waking up at before 5am so you can park at a train station and than get to work for 9am is seen as preferable to having to go some where that isn't on the tube map, you sound like every Londoner I know .
I get to leave the house at 815am, do the school run, and than cycle to work from the school, usually am at the desk before 9am. But it's pretty hellish to live some where as remote as Leicester!!!
When living in Leicester is seen as preferable to anything you sound like ever Leicester born person I know .I get to leave the house at 815am, do the school run, and than cycle to work from the school, usually am at the desk before 9am. But it's pretty hellish to live some where as remote as Leicester!!!
Shnozz said:
When living in Leicester is seen as preferable to anything you sound like ever Leicester born person I know
Luckily I was born about 9000 miles from Leicester, my parents obsession with London was why I choose not to go University at Imperial and choose Leicester instead. Leicester was the furthest away from London I could go as Newcastle saw through my substandard UCAS application and didn't even offer an interview.I have to confess my parents living in London is one of the reasons I probably don't seem them as much as I should, so I probably should be less biased with my views on the place.
A colleague is buying a house as FTB, from a landlord, who has asked current tenants to vacate.
Not remembering all parts of the conversation, but it was mentioned that landlord wants to proceed with sale as quickly as possible.
Is there any reason why landlord would want to exchange/ complete as quickly as possible? Before 30-Apr-2024 tax year end?
the government will introduce legislation in Spring Finance Bill 2024 to reduce the higher rate of Capital Gains Tax for residential property gains from 28% to 24%.........
so would it not make sense for landlord to sell in the next tax year? Or have I got that face about arse?
Not remembering all parts of the conversation, but it was mentioned that landlord wants to proceed with sale as quickly as possible.
Is there any reason why landlord would want to exchange/ complete as quickly as possible? Before 30-Apr-2024 tax year end?
the government will introduce legislation in Spring Finance Bill 2024 to reduce the higher rate of Capital Gains Tax for residential property gains from 28% to 24%.........
so would it not make sense for landlord to sell in the next tax year? Or have I got that face about arse?
Lol CGT down on house sales?
Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
gangzoom said:
When waking up at before 5am so you can park at a train station and than get to work for 9am is seen as preferable to having to go some where that isn't on the tube map, you sound like every Londoner I know .
I get to leave the house at 815am, do the school run, and than cycle to work from the school, usually am at the desk before 9am. But it's pretty hellish to live some where as remote as Leicester!!!
I'm 100 miles from London these days and have always woken early. But that doesn't change the fact that in any city you don't want to be commuting with the school run and clerks but either with the coffee makers or solicitors either side of the peak time. .I get to leave the house at 815am, do the school run, and than cycle to work from the school, usually am at the desk before 9am. But it's pretty hellish to live some where as remote as Leicester!!!
I think a lot of people struggle to understand that different people find pleasure from different things in life. Many genuinely don't like the chaos and heave of London but many don't like the homogeny of regional towns. So I'd agree with you that somewhere like Leicester is pretty hellish. But I overtly recognise that for many others it is a lovely place. The idea of uniformly leaving at 8.15, doing the school run and being at a desk by 9 is my personal idea of suburban hell but millions do that and clearly that's their pleasure but it's not everyone's
Anyway, back to the house price aspect, I feel that we're in a hiatus currently which may be a lull. Everywhere has that sort of feel that the bad news is over and we're moving on but I'm not entirely convinced that the underlying drivers of downward pressure have gone away. Things like easing inflation, job security, stabilising rates and energy costs softening seem to have generally assured the consumer that the bad times are behind them but as it generally takes years for events to cumulatively work through there is an argument that this is just the relief rally after the first dip from peak.
M2 money supply while recovering from a steep contraction in Q4 last year still looks to be in decline and we currently hover at the £3tn level waiting to see stability or further falls. Consumers, despite getting pay rises, many of which do or can be made to outstrip personal inflation haven't increased saving rates from frighteningly low levels pre-Covid. We have the largest middle income class the U.K. has ever had but it has the saving habits of the lower income demographic (This is a new money scenario where the high income is first generation and they over shop due to having nothing in their youth as well as a need to advertise their success. This is a huge issue in China at present where this effect has been enormous and is causing major structural issues as the new 'middle class' has no actual wealth but considerable debt. In the U.K. it's still quite large and tends to manifest itself via higher income earners using credit for consumer goods and services because despite having high income they don't have the actual wealth that usually brings.). We also have a housing loan market that has almost entirely been shifted into short term debt contracts which ought to terrify people due to the remargining power it gives the lenders, yet people appear instead to be really happy with being offered an illusionary discount in exchange for that ability of the lender to remargin their debt.
For me I see all these 2 year fixes as a potential time bomb that could destroy all mortgage holders at the early stages of their 25 year purchasing plan when their LTV is at such low levels that just a change in the sentiment of the lender's valuation team could wipe out their margin in an instant. That's a real risk to the market. Mortgage holders could see zero material change in their personal solvency, income good, job prospects good, savings rate OK but at the swish of a pen the lender can revalue the property value downwards by and amount that completely wipes out their deposit and forces them to pluck a new deposit out of thin air or be treated as a junk debt customer and moved onto the SVR, which isn't even a financial product but just a fear stick to cajole consumers into fee based, remarginable products.
I still think we are teetering and that an 'event' would tip it all. And while many look to things like the stock market as that is where these trigger events have occurred or manifested themselves historically I'm not convinced that in the modern economy where debt is the controlling factor that this is a valid argument.
Commercial office space and its debt is looking quite toxic. It was a big speculative bubble in the run up to Covid and commercial property assets in the West were primary holdings sought by the vast swathes of Asian wealth needing a secure home. For nearly a decade it was also the case that you could gear up massively on cheap debt from the capital markets and get a higher yield from a commercial building. And unlike resi mortgages no governments were controlling multiples or regulating any of this behaviour. It was all left to the lenders. For years investors were leveraging office blocks to near 100% debt and sometimes over. But the flow of Asian wealth has eased, in some cases reversed as Asian investors have needed to divest of assets b overseas to shore up balance sheets at home as their property market collapses in debt. The cheap debt model is gone and debt now costs more than property yields which means not only have the number of entrants eased right off but many existing participants are now operating under water as their debt refinancing rates now far exceed the asset yield. And it's not just an attack on the debt front but also on the yield side as the whole WFH shift means occupancies have been falling and tenants have been renegotiating rents downwards.
The lending dip in Q4 last year looks to have been caused by the number of property refinancing deals getting recategorised as junk debt by the banks. US occupancy rates in some key cities have collapsed and the longer they stay down the more likely it is that they will have a manifest impact on the restructuring of those cities. London seems better placed but still has vast numbers of property assets now underwater. We've had a decade of the 'family wealth office' clumsily over paying for property assets while playing the Billy big balls, look at me, I'm a playa game. They now are starting to have to refinance at huge premiums as their flood of money in has slowed making it riskier for them to maintain their new and much higher debt obligations.
And if there were to be a commercial property debt driven implosion then pension funds will be smashed hard. The kind of hard hit most are currently thinking comes from the stock markets which as they're currently rising means everything is all good and safe.
Personally, given how illiquid property funds are I wouldn't have a penny invested in that area of the market because getting one's money out should you want to if it were to start to fall wouldn't be possible. An investment where you have no control as to whether you can cash out or not is about as toxic and risky as it gets. It is certainly an aspect anyone with a pension should be paying some attention to right now. Even if the stock market falls you can always exit or hedge but with property funds if the need to exist comes from the fund then that fund will halt exits and hedging facilities for private investors are almost non existent as the stock lend would have been pulled by the pension funds.
Mr Whippy said:
Lol CGT down on house sales?
Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
Rats / sinking ship springs to mind.Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
havoc said:
Mr Whippy said:
Lol CGT down on house sales?
Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
Rats / sinking ship springs to mind.Is this more cronyism? Conservatives and pals selling up or something?
This is absolutely unnecessary while at the same time they’re exposing even more trinkety CGT to eBay sales and reduced tax free allowance to nearly nothing.
No one needs more than one house, and gains in excess housing in the current environment are imo ill-gotten, so why the tax break?
The more sensible thing to have done would have been to offer an exit amnesty prior to substantially increasing the tax via a ratcheting timing scale. They could even have set a nice trap by allowing the bulk of the CGT discount and subsequent increase be set by the local authority who would keep what they don't discount.
DonkeyApple said:
Anyway, back to the house price aspect, I feel that we're in a hiatus currently which may be a lull. Everywhere has that sort of feel that the bad news is over and we're moving on but I'm not entirely convinced that the underlying drivers of downward pressure have gone away. Things like easing inflation, job security, stabilising rates and energy costs softening seem to have generally assured the consumer that the bad times are behind them but as it generally takes years for events to cumulatively work through there is an argument that this is just the relief rally after the first dip from peak.
Agree with this.Also, all these people saying "stagnant house prices are the way forward" (which I don't entirely disagree with) - at the current rate of wage inflation, if we're aiming for the current 8x mutliple to drop to the historic 4-5x multiple (avg house price : avg earnings), then simple compounding suggests it'll take us +/- 20 years (!) to get back to that (IMHO sustainable) level. Another generation who'll struggle to buy/own their own home (bad grammar, sorry), and then wonder "WTF do we do in retirement?"
DonkeyApple said:
MConsumers, despite getting pay rises, many of which do or can be made to outstrip personal inflation haven't increased saving rates from frighteningly low levels pre-Covid. We have the largest middle income class the U.K. has ever had but it has the saving habits of the lower income demographic.
In the U.K. it's still quite large and tends to manifest itself via higher income earners using credit for consumer goods and services because despite having high income they don't have the actual wealth that usually brings. We also have a housing loan market that has almost entirely been shifted into short term debt contracts which ought to terrify people due to the remargining power it gives the lenders, yet people appear instead to be really happy with being offered an illusionary discount in exchange for that ability of the lender to remargin their debt.
Also very true. We've been sold the lifestyle lie that we can have it all if we just borrow or put it on payment plans (PCP?!?), which leaves us permanently chasing the next hit of "look what I've bought", with nothing to show at the end of it when we retire on (frankly pretty sIn the U.K. it's still quite large and tends to manifest itself via higher income earners using credit for consumer goods and services because despite having high income they don't have the actual wealth that usually brings. We also have a housing loan market that has almost entirely been shifted into short term debt contracts which ought to terrify people due to the remargining power it gives the lenders, yet people appear instead to be really happy with being offered an illusionary discount in exchange for that ability of the lender to remargin their debt.
t) money-purchase schemes that are worth a quarter of our pre-retirement income because no-one's been talking about that time-bomb.Talking of pensions and the hit to come...
DonkeyApple said:
And if there were to be a commercial property debt driven implosion then pension funds will be smashed hard. The kind of hard hit most are currently thinking comes from the stock markets which as they're currently rising means everything is all good and safe.
Personally, given how illiquid property funds are I wouldn't have a penny invested in that area of the market because getting one's money out should you want to if it were to start to fall wouldn't be possible. An investment where you have no control as to whether you can cash out or not is about as toxic and risky as it gets. It is certainly an aspect anyone with a pension should be paying some attention to right now. Even if the stock market falls you can always exit or hedge but with property funds if the need to exist comes from the fund then that fund will halt exits and hedging facilities for private investors are almost non existent as the stock lend would have been pulled by the pension funds.
I don't think the average Gen-X or Millennial realises what's ahead of them. The London property-owning set can retire to the regions and have a nice little nest-egg from it all, but very few others can. Some lucky people will be able to cash-in an inheritance from their parents when they die-off, but that's a 1-time thing which will leave the next generation sPersonally, given how illiquid property funds are I wouldn't have a penny invested in that area of the market because getting one's money out should you want to if it were to start to fall wouldn't be possible. An investment where you have no control as to whether you can cash out or not is about as toxic and risky as it gets. It is certainly an aspect anyone with a pension should be paying some attention to right now. Even if the stock market falls you can always exit or hedge but with property funds if the need to exist comes from the fund then that fund will halt exits and hedging facilities for private investors are almost non existent as the stock lend would have been pulled by the pension funds.
t out of luck.And in 20-30 years time when most* people are struggling through a delayed semi-retirement and wondering why we haven't got what our parents / grandparents had, we need to look back to the last 20-30 years and recognise the lies we let ourselves be told and the empty promises we swallowed from politician after politician.
* Public sector aside.
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