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Tired of Waiting

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Posts posted by Tired of Waiting

  1. There is still an element of waste if houses are viewed as an investment as opposed to somewhere to live. How many people for example would have second homes (not classed as empty), how many co-habiting boomers would not have a house each (I know dozens of these), how many would live in houses far too big unless there was an investment angle to all this unutilised space.

    If interest rates were not subject to manipulation trust me there would be genuinely a million empty homes and we would soon achieve price discovery.

    Now I agree with you, there is a lot of "waste" in housing, but mainly by the older generations.

    Edit: But most of them don't have mortgages any more, and would not be pushed out of their bungalows by high IRs. The only remaining hope is that if saving accounts were paying higher interests some would be tempted to downsize? Not sure if many would though.

    Besides, our overall housing stock must improve, not only in numbers, but quality and size as well.

    .

  2. It's probably over emphasised the housing shortage. Rate hikes would soon free up a large proportion of the million plus empty homes, caused by hoarding or non motivated sellers. My mother-in laws house has sat empty for two years; they have finally got around to selling it, but I'm sure if they could actually have earned money on the sale proceeds they may have been more motivated sellers. You walk across the hottest areas of London property and you wonder if anybody actually lives there. Certainly a lot of speculation going on, part of an investment portfolio as opposed to somewhere to live, and many not even let out.

    You can bring the market back to fair value either by building houses we may not need or unwind QE and stop these schemes such as help to boomers 2 designed to protect housing equity.

    The myth of the "million empty properties": http://spatial-economics.blogspot.co.uk/2011/09/empty-homes-and-housing-crisis.html

    Only around 100k empty for over 6 months in the SE + London + East.

  3. If rates were hiked we would rapidly see that there is no housing shortage in the UK IMPO.

    What we do have is knackered, exhausted stock much of which should have been knocked down decades again. Sadly, when we built we put up stuff that is often equally as rubbish.

    If rates were hiked I would be able to afford a [email protected] house. But the evicted family would have to live in this [email protected] rented house.

    We could have better and bigger houses instead.

    Countries like France and Germany manage that. Why can't we?

    Wolf knows why: Because of the anti-building lobbies, like the CPRE, owners of land banks, and today’s homeowners.

    Incredibly, their propaganda is so powerful that it even works in this forum!, of all places!

    .

  4. Mr Wolf's main points: That the government’s Help to Buy scheme is really helping those who wish to keep housing costly: today’s owners, banks and housebuilders, a conspiracy to keep house prices exorbitant. A policy of increasing demand is absurd. The solution is evident, but politically unthinkable: make a large quantity of land available for development and impose a swingeing site value tax, to compel building. But this would be too unpopular and too dangerous because of stout resistance from the Nimbys, CPRE, owners of “land banks” and today’s homeowners. These lobbies are far too formidable for any government. Liberalisation might threaten UK banking. Unlike in Ireland, Spain or the US, house prices fall in the UK has been modest. Moreover, the constraints on supply that have kept prices up also curbed the pre-crisis building boom. Its egregious supply constraints (might have?) saved UK banks. The victims of this vile system are the young and upwardly mobile, who are either unable to buy at all or are trapped in a lifetime of debt serfdom. The political genius of the scheme is that it appears to help these hapless victims, while in fact helping the usual suspects: banks, homeowners, Nimbys and, if it creates another housing boom, the government. The government is committed to frighteningly expensive housing. It is a trap from which the UK may not now escape.

    [email protected]

    - - -

    FWIW, I think I'll email him a "thank you very much indeed!" for this article.

    Good man Mr. Wolf. Thank you!

    .

  5. "Buyers beware of Britain’s absurd property trap", by Martin Wolf.

    Absolutely brilliant. A must read.

    On the FT, but going through Google may allow non-subscribers to read it: https://www.google.co.uk/search?q=Buyers+beware+of+Britain%E2%80%99s+absurd+property+trap&ie=UTF-8#q=%22Buyers+beware+of+Britain%E2%80%99s+absurd+property+trap%22

    .

  6. I had the misfortune to see him on the TV this morning explaining how the housing market 'isn't in a bubble' and that Help To Buy will improve things for young people in terms of housing.

    Proof,if it were needed, that Oxford aren't that picky.

    It was thoroughly depressing.

    Actually Cameron quoted the BoE.

    And when asked again he did it again: "don't take it from me... the BoE..." Cameron did it twice in the Marr show alone, and repeated the answer in other media as well. That tells me Cameron is well aware of the risks, and is already positioning the BoE to take the blame.

    I would love to have seen Carney's face watching the Marr show. :lol:

    [email protected] all of them. Feck them all.

  7. "Fans of the LVT will be irritated to note that it [edit: i.e. Denmark] has suffered something of a property price crash over the past few years"

    Seems a little confused there.

    Yes.

    And she is treating LTV and property (incl. buildings) taxes as if they were almost the same thing.

    Besides, why the need to be the "only" tax? I think it should be the only tax on property (no more taxing improvements on the land, such as buildings), but the gov could keep taxing income, VAT, fuel/alcohol duties, etc. Why not?

  8. There's a new article from Merryn Somerset Webb in a certain pink newspaper that has some good arguments for a Land Value Tax.

    Very interesting article. Thanks for pointing it out. And the link via Google works.

    This Danish policy is brilliant:

    "In Denmark citizens pay 1 per cent of the value of their property to the state for the first DKK3.04m (£343,000) of its value and 3 per cent for anything over that. There is also a municipal tax based on land values."
  9. The answer to the child question is you make the child part slightly less than the child costs.That way extra children cut into the adults benefits thus making extra children lower the standard of living for people on full benefit rather than increase it.

    The problem with tax credits is that at around 2 to 3 children no extra work or pay increase matters for most people.Their standard of living is based on the % increase in tax credits.Thats its main downfall.

    Tax credits at the 1 child level is only slightly too generous.Its the extra children that make them very lucrative.

    But you can't be sure that those £150 will be spent on the baby. That's why I was thinking about food/clothes vouchers instead.

  10. He lives on the outskirts (still served by the amazing tram system), and yes since he's an engineer (and his father too) they did some of the work themselves. But the house has an underground car park, 3 large bathrooms, I don't know how many bedrooms, high quality fit and finish for everything... even electric blinds which are actuated by photodiodes and integrated to the central heating system! Something like that even on the outskirts of a city in the UK would cost 3x more (without even taking into consideration the cost of land and planning permit!)...

    hell even a simple solar panel installation for a house in the UK "somehow" costs 2-3 times the price in Germany for the same bits and bobs due to the "MCS scam".

    The cost of construction in the UK is unreal. Its not only a land price bubble, but the bubble in land prices has masked the massive inefficiencies of construction companies in the UK for far too long. Yet it seems that mainland companies (or even Korean companies) can't seem to get a foothold in the UK construction sector to shake them up a bit...

    Excellent point hayder! First time I hear/read it. Thank you!

    Of course! In any other area external competition would force the locals to shape up, or go bust. But that doesn't happen in the building industry. The cause? Our planning system?

  11. Say £500 per person per month or £6,000 p/a gives you an absolute minimum subsistence income.

    Giving that to 65,000,000 people is going to cost the country the small matter of £390 billion pounds per year.

    Not sure how that's going to ever be affordable.

    fluffy666 had some good arguments above, and Petri Dish reminded us of how much we are spending already.

    Besides, IIRC our estimates were based on a lower CI. Remember that it can be easily supplemented by just a few hours of work/week. I think durhamborn was suggesting £360/month. This would be just enough for basic food and basic accommodation (probably a studio or shared accommodation, and in a cheap region of the country). But just 10 hours of work / week, even at minimum wage, would take the monthly income to around £600 = £12k/year.

    One issue that would remain very difficult is regarding children. As a civilised society we must guarantee that all children are well provided for, but we can't repeat the past mistake of offering financial incentives for people to have children. I don't know how to square this circle.

    Perhaps one option could be to offer free services, but not cash? Like free child care, free nurseries, even food vouchers, clothes vouchers, etc., but not cash?

  12. But a 300 - 400m2 plot would have cost him 150k - 300k Euros depending on the location in Karlsruhe. He must have done a lot of self build for the 150k; building costs are more expensive in Germany than they are in the UK. 150k would get you a shell which you would have to plumb, wire, fit kitchen/ bathroom(s), decorate etc. A 160+ m2 house in Karlsruhe would cost you €400k upwards & a mansion (200m2+) in a good area will set you back over €1m.

    Urban plot, for a detached house, 460m2, for E115k:

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&ie=UTF8&prev=_t&rurl=translate.google.com&sl=auto&tl=en&u=http://www.immobilienscout24.de/expose/69942329&usg=ALkJrhgnW5-GgSVpMShzhpuhUF_5zkY-tA

    Plot for a "weekend house", 1,300m2, E48k: http://translate.googleusercontent.com/translate_c?depth=1&hl=en&ie=UTF8&prev=_t&rurl=translate.google.com&sl=auto&tl=en&u=http://www.immobilienscout24.de/expose/69467556&usg=ALkJrhjNKd2Ez2knUP-7p9hYygxNpwmnhA

    The site also has a whole section for building plots, like in any country on earth, bar Britain.

  13. It is strange how extra taxes are deemed to solve problems on this forum. If LVT was introduced to replace another tax, there could be some merit in it. However, any new tax will be an additional tax, not a replacement.

    How many people on this forum would actually like to pay LVT, council tax and all other taxes if and when they can afford a house?

    The only chance LVT would have political support would be if it was a replacement for Council Tax, and reducing the tax paid by the majority of the population, ideally over 2/3 benefiting.

  14. a/ nope in the range of billions of £

    b/ majority of unemployed people are low skilled, so no extra billions of £ here either

    c/ if you introduce the LVT you would need to decrease other taxes to compensate (such as income tax). so the tax man income remains the same

    also where do you think the LVT money (e.g. 100 billions of £) would come from?

    - friend of mine sells holidays over the phone, wife works just a bit, 3 kids and house worth over £600k. without the tax credits and other benefits they would be already doomed. LVT would kill them

    - farm land is a similiar story; in this case the LVT would increase food prices and majority of farmer owners would go bankrupt

    -------------------------------------------------

    an idea to give everybody £350 pm is an utopia

    what we need is a system where 90% of the population are productive producers and only 10% are net consumers

    current system with the tax credits, housing benefit and public sector pensions is like 30% of the population are producers and 70% are almost net consumers

    Plenty of low skills jobs around, and with CI people would be allowed to do them, to top up their monthly income.

    Yes, we should reduce another property tax, not income tax, like eliminating Council Tax and Stamp Duty.

    Your friend can't afford and doesn't deserve that house.

    Farm land can have a much lower rate than residential properties.

    With CI all barriers and disincentives to work would be removed.

  15. in mainland europe construction companies advertise their houses on price per meter... they have catalogues and you can pick a design, have it changed to your liking and they build it for you on your plot.

    A friend in Karlsruhe built a MANSION for about 150k euros. He came over to london once and laughed his ass off at the "houses" people here live in :(

    I've been trying to tell that to people here for years. People just don't get it.

  16. This has been discussed before, even if the same amount of money is given out as per the current benefit system, you cut whole swathes of bureaucracy away which saves money.

    In addition it frees people from the bureaucracy so they can actually go do something. They can start a business that doesn't make mega amounts of money or take a part time job and not worry they are going to lose all of their benefits.

    Also if it costs the same when couple with LVT then it is a win. Rather than paying all the large land owners for simply possessing land we should be charging them for its use. They certainly wouldn't be happy if we were invaded and their land was taken away, so why should we be happy that they are enforcing their land ownership based on past use of force.

    Again, I should have read the whole thread before replying... :D

  17. I am sorry but the Citizen Income is unworkable:

    - politically it is dead

    - it would cost same £2 billions pa as current system

    - the currentsystem is fixable - cancel tax credits, replace housing benefit by new social housing and reduce public sector pensions

    I used to think that as well, that it would be unaffordable, but after some estimates, it may be possible. As you say, it wouldn't cost much more than the current system, but with some economic and even political advantages.

    Economically the two main advantages are the elimination of perverse incentives and the huge bureaucracy needed for means testing the current system.

    Politically, remember that taxpayers (and family) will get CI too, getting a partial return on their taxes, reducing their resistance, and the economic advantages above can be explained to them.

    It may be possible after all.

  18. I will try to find the time to have a proper dig on the website. Be warned Okayama is not like the SE of England. I am not familiar with it, but I think the Midlands would be a better comparator. I didn't check the desirability of the location very well either.

    Yes, I was expecting that, but even if we compare your prices with our "provincial" cities, say our average income is around 30k, those plots would cost less than £40k! That is less than half what plots of that size would cost here. Besides, Rightmove doesn't even have a section for building plots! UK property sites simply don't have this section! I don't know of any other country where that happens.

    .

  19. Self build is not unusual in Japan, but you won't get a plot for 10 to 15k or anything like it

    Here's an example plot plucked at random which looks fairly typical - the first one in the list is offering 160 to 300 m2 for 6.2 to 7.5m yen. Average household income in Japan is about 5m yen. It is in Okayama a medium sized city.

    http://smp.suumo.jp/tochi/okayama/sc_202/

    Sure, I am not saying that the price would stay the same, just £1k per plot (you can build 10 to 20 houses in 1 acre), of course not. But to go up by a factor of 100 is ridiculous.

    Your example is brilliant! (Thanks for that BTW). Good sized residential plots (160 to 300m2), in a medium sized city, for just 20% above average household income?! It would be great if we had the same here!

  20. Remind me again, who signed the contract to go into this debt? It certainly isn't my debt.

    I understand, I feel the same way. I am a tenant and a taxpayer. My taxes are used to prop up house prices and rents against my own interests. Problem is, the majority of voters do vote for these parties and policies, unfortunately. We do have a choice though: emigration. We are not forced to stay here.

  21. Every village has to have a plot of 0.1 acre made available via auction for every 200 houses every year. Minimum of 1 every 3 years (for small villages).

    Current owner of land gets farmland price plus a bonus.

    House must be a minimum in terms of a set of criteria meant to control size of rooms, environmental, storage, rainwater runoff etc. ie build a decent usable house raising average build quality and usability over time.

    Yes, exactly, something like that.

    For instance, a 2% growth per year. A village of 100 houses should allow 2 new houses per year.

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