Help to Buy Scheme - Good,Bad,Risky, who knows!

[Herr Tubthumper]

It really is a daft idea.
House prices are still far too high on an average price to average earnings ratio.Many will still be saddling themselves with debts they can't really afford and when interest rates rise and the bubble bursts,negative equity will rear its ugly head again.
Our unhealthy obsession with house prices in this country really will end in tears and I find it so sad that young people cannot buy a house for an amount that doesn't crucify them financially.
House prices should be allowed to find their correct level over time and not be artificially stimulated by a crackpot scheme.
Do Governments never learn?
I write as a Tory voter!

Agree. One thing that has depressed me is a conversation I had a few years ago with a couple of friends who both earn above average wages but did not have any hope in securing a mortgage without outside help. This to me is pretty shit. Surely you should be able to buy, at the very least, a small property from earning good money? Otherwise what's the point?

 

[Beach Hut]

When I retire I get a tax free lump sum which will be the only chance for my kids to get on the housing market at present.

The whole housing market is now obscene beyond words and London is fuelled by foreign investors purchasing expensive houses.

When the inevitable does happen and interest rates have to go up we will be back to square one of this recession as incomes will collapse under the strain.

I really am very shocked the conservatives support this.

 

[seagull_in_malaysia]

I'm confused, why is buy-to-let bad for the economy? Surely it means there is a greater supply of housing available for people (who wouldn't be able to afford a home) to rent?

 

[beorhthelm]

...Surely you should be able to buy, at the very least, a small property from earning good money? Otherwise what's the point?

odd point of view from you, being our resident deutschophile, i'd have expected you to not be fussed about property ownership. interesting that you hold on to this old Anglo-Saxon trait (its wasnt invented in the 1980s, its deep rooted, so much that generations left to other lands to have the opportunity). i was hoping you could offer insight to why the europeans dont care so much for ownership.

 

[Farehamseagull]

Very bad idea and complete hypocrisy from this government that on the one hand tell us we need to end the culture of debt we have in this country and on the other encourage us to take on a risky debt that a lot of people will not be able to sustain.

I still don't know why we have this obsession with owning a property in this country. Why should you have the 'right' to own a property if you cant afford it?

What would be a much better idea is to bring in the guaranteed long term family Tenancies that are starting to be talked about at the moment that would give a lot more security and stablity to families without saddling them with debt.

 

[Safeway]

I still don't know why we have this obsession with owning a property in this country.

Quite simply, I think it's because people would rather pay money towards something that is actually theirs than on something that isn't, all the time lining someone else's pocket.

 

[Shoreham Gull]

I'm confused, why is buy-to-let bad for the economy? Surely it means there is a greater supply of housing available for people (who wouldn't be able to afford a home) to rent?

Yes I agree and so should most..
Only people who hate buy-to-lets is the renter who can't get on property ladder,
The thing is if buy-to-let's end, then there be a shortest of rental properties!!

So what do people want less rental properties or more properties to buy?

 

[Barrel of Fun]

I just want a bit of land and I'll build my own home with the help of Kevin McCloud #ManMadeHomes

 

[unklbrian]

Yes I agree and so should most..
Only people who hate buy-to-lets is the renter who can't get on property ladder,
The thing is if buy-to-let's end, then there be a shortest of rental properties!!

So what do people want less rental properties or more properties to buy?

Are the Homes that are no longer being rented going to be destroyed then ?
the 2 levels balance out to some extent surely ?
and the local high rents causing Housing Benefit to be payed to NonUK taxpayers declines if BTL's are sold

 

[Justice]

The scheme will be non productive, the criteria these days to obtain a first time mortgage is near impossible as self cert mortgages are no longer available. Its a tory con cleverly designed to look like a caring move from the government.

 

[Herr Tubthumper]

odd point of view from you, being our resident deutschophile, i'd have expected you to not be fussed about property ownership. interesting that you hold on to this old Anglo-Saxon trait (its wasnt invented in the 1980s, its deep rooted, so much that generations left to other lands to have the opportunity). i was hoping you could offer insight to why the europeans dont care so much for ownership.

Fair point to pick up on; I was writing in the context of the UK where home ownership is in the DNA. Here, renting is more popular as you correctly point out. My take on the reasons are that it is cheap, highly regulated with controls on rent increases, it is stable in the sense if you find a place you like you can rent it seemingly forever and there is not the need to own a house to sell to pay for costs should you need medical care late on...the state pays for this, nor the need to leave a house for your children as they will probably not stuggle to have a roof over their head. The tenant has a lot of power here. As an example a friend of mine rented a place on a controlled lease and the owner of the building wanted to sell the block vacant; my friend took 7000k to move out as there was no way the landlord could move him. I do not agree with this but it serves as an example of the power the tenant has. In the UK you only need wait until the end of the lease to move people on. Cheap and ready supply of stable accomodation is the key.

To give you an idea I rent here and my apartment is right in the middle of the city and I pay less than the equivalent in the centre of Brighton but my rent includes ALL utility bills AND council tax. I'd say my total rental costs including all bills and other costs is 2/3 that of Brighton and I am in the middle of a capital city. To give further context my apartment is in an old building which has been refurbished/modernised.

 

[Herr Tubthumper]

I'm confused, why is buy-to-let bad for the economy? Surely it means there is a greater supply of housing available for people (who wouldn't be able to afford a home) to rent?

It created a lot of demand which was not previously there; pushing house prices up which had knock on effects for other people wanting to buy (as home owners not landlords) and also for people wanting to rent as if a property costs more then the landlord charges more. And a proportion of these renters would not need to rent if they could have bought the property which was hoovered up by a landlord so you would not need all this additional rental property you suggest.

 

[Herr Tubthumper]

What would be a much better idea is to bring in the guaranteed long term family Tenancies that are starting to be talked about at the moment that would give a lot more security and stablity to families without saddling them with debt.

Agree.

 

[Herr Tubthumper]

Only people who hate buy-to-lets is the renter who can't get on property ladder,

Total rubbish.

 

[topbanana36]

I was sick of paying some **** rent, would much rather earn my own place, so any chance of owning a house is a good idea IMO. I am planning on returning next year but there is no way I could afford a home for my family in Brighton, even earning 30,000.

 

[willyfantastic]

my girlfriend has done it to snap up one of the new flats in development at the childrens hospital

so many rules involved with it - one of them being she supposedly has to live by herself for 5 years, which is ludicrous (and its a 2 bed flat)

 

[CheeseRolls]

Oh, and buy-to-lets are increasing severely as well; how is this good for the nation?

I don't know. Why don't we ask the Berliners ?

http://www.telegraph.co.uk/finance/...mans-develop-a-thirst-to-own-their-homes.html

EDIT Should really have read the rest of the thread before jumping in here.

 

[Hatterlovesbrighton]

Agree. One thing that has depressed me is a conversation I had a few years ago with a couple of friends who both earn above average wages but did not have any hope in securing a mortgage without outside help. This to me is pretty shit. Surely you should be able to buy, at the very least, a small property from earning good money? Otherwise what's the point?

But that is what Help to Buy is trying to fix, those with a high salary but no deposit. Now you could argue for a wholesale reduction in house prices, but all that is going to do is plunge millions (including nearly all recent FTBs) into massive negative equity. No Government is going to try to do that, and nor should they.

 

[sam86]

For me and my partner, trying to save circa £20,000 in order to purchase a family home is pretty much impossible. This is whilst friends with richer parents are moving in left, right and center. Whilst with our jobs, we easily have enough to afford the monthly mortgage. There's obviously going to be pros and cons to something like this, but it's pretty much a life changer for us.

 

[The Antikythera Mechanism]

Looks like the rates for a 95% mortgage will be between 4% - 6%, whereas a 60% mortgage is around 2.5%. If you can afford the repayments, what's the problem?