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Tuition Fees To Cause The Next Housing Crisis

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http://net-lettings.co.uk/London-Property-News/Articles/Tuition-fees-rise-to-lead-to-housing-crisis-1673.html

Tuition fees rise to lead to "housing crisis"

By Andy Britten

Published 11th June, 2010

Young aspiring property owners leaving university could find that they may not be able to make repayments on a mortgage due to higher tuition fees, according to one expert.

Johnny Rich, editor of Push.co.uk - an independent university guide - warned that the 40 per cent of school leavers heading to study in higher education might struggle to be approved for a home loan, because of increased student debts to pay for their course.

"If we have an entire generation of our society who are unable to buy houses because they have such massive debts when they leave university, we will see a housing crisis," he said.

This week, universities minister David Willetts cautioned against an increase in tuition fees, as it could have a negative impact on the UK economy and the Treasury would struggle to sustain the rise in student loans.

His comments about the potential effects of higher tuition fees on a university leaver's ability to get a mortgage may encourage more young people to consider looking for property to rent in the London borough of Harrow or elsewhere in the country.

Mork calling Orson... come in Orson. I've learnt something interesting about life on planet Earth today sir - You can't fix the problem of debt with more debt.

mork.jpg

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American graduates have massive debts when they leave university, but manage to buy houses. The market seems to find a way.

A non-story in my opinion.

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American graduates have massive debts when they leave university, but manage to buy houses. The market seems to find a way.

A non-story in my opinion.

They earn 6 times the amount a uk grad earns, have better quality of teaching etc... you just cant compare the US grads with UK grads.

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They earn 6 times the amount a uk grad earns,  have  better  quality of teaching etc... you just cant compare the US grads with UK grads.

:lol: they do not have 'better quality teaching'.

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To be fair, they probably don't earn 6 times what UK grads do. UK grads get anywhere from 18-25K these days if you're any good. Advise to American MBAs for example these days is take anything offered over $40K. That's not much different and an MBA is a postgrad.

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laugh.gif they do not have 'better quality teaching'.

Erm have you seen the teaching quality here? i can tell you classes are taken by phd students in this country, and this is increasing, academic staff contact time in the states is greater, in the uk its dropping the list just goes on.

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To be fair, they probably don't earn 6 times what UK grads do. UK grads get anywhere from 18-25K these days if you're any good. Advise to American MBAs for example these days is take anything offered over $40K. That's not much different and an MBA is a postgrad.

erm uk grads get anywhere between 0 and 20K, i love to find out the mean and range values of uk graduate earnings. Look at how many ideas are generated by US uni students compared to the UK? look at the backing by US universities give to their students towards business ideas etc... You just can't compare the US system to the british system. Stamford you have a higher chance of leaving before you graduate and starting a business than graduating.

Edited by crash2006

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Erm have you seen the teaching quality here? i can tell you classes are taken by phd students in this country, and this is increasing, academic staff contact time in the states is greater, in the uk its dropping the list just goes on.

Not true. The US system institutionalises the very abuses you complain about; TA, TF, Instructor, Lecturer, Assistant Professor, Visiting Assistant Professor, these are names for PhD students and post-docs doing other people's teaching. I have comparative experience here, I used to work somewhere expensive on the East Coast. Contact time? Crash2006, they can't even call their (real) Professors by their first names. Oh for the Ivory Tower pomp of such a position.

Edited by Cogs

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Not true. The US system institutionalises the very abuses you complain about; TA, TF, Instructor, Lecturer, Assistant Professor, Visiting Assistant Professor, these are names for PhD students and post-docs doing other people's teaching. I have comparative experience here, I used to work somewhere expensive on the East Coast. Contact time? Crash2006, they can't even call their (real) Professors by their first names. Oh for the Ivory Tower pomp of such a position.

Well guess you havent been at a university in recent years, iam at a 200 year old uni now and find the level of teaching poor, they seem to be more interested in their research. I have done a degree 10 years ago and can say i see the difference.

Edited by crash2006

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The real impact will be if the total number of students decreases in a major way. A lot of buy-to-let landlords made their money in the inner-cities when they realised letting out individual rooms to students was far more profitable than trying to rent out a 2 or 3 bedroom terrace (which often didn't appeal) to "professionals".

As it happens I suspect the total number of students won't fall - the number of native British students able to afford it maybe, but we'll see a continuation of large numbers from the East and other areas of the globe.

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American graduates have massive debts when they leave university, but manage to buy houses. The market seems to find a way.

A non-story in my opinion.

"If we have an entire generation of our society who are unable to buy houses because they have such massive debts when they leave university, house prices will fall to epochal lows unseen in real terms since before the first world war and my inheritance from my grandma - 3rd Earl of Swiltshire - won't be so much," he said.

corrected

Edited by Si1

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American graduates have massive debts when they leave university, but manage to buy houses. The market seems to find a way.

A non-story in my opinion.

Indeed. The market has found a way. House prices have dropped by 80% in many states. :lol:

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Indeed. The market has found a way. House prices have dropped by 80% in many states. :lol:

:)

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Guest The Relaxation Suite

American graduates have massive debts when they leave university, but manage to buy houses. The market seems to find a way.

A non-story in my opinion.

American graduates earn considerably more and the average American house costs much, much less at around 2.5 times average income, compared with 5 or 6+ in the UK.

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They earn 6 times the amount a uk grad earns, have better quality of teaching etc... you just cant compare the US grads with UK grads.

Some of them do. That's why the tuition fees at Harvard and UCLA are a lot higher than those of the community college at Buttfück, North Dakota. They charge what the market can bear. The students who are willing to take out loans to take the more expensive degrees do so in the knowledge that they'll earn what it takes to pay them back and have a decent standard of living. Also, a significantly smaller proportion of US school leavers go through a full scale degree course than do ours.

I agree that the real house price issue precipitated by imminent developments in the HE sector will be in respect of HMOs rented to students in university towns. Towns that have both a pre-92 and a post-92 large institution in close proximity, and with a low proportion of their students in university-owned accommodation (i.e. most of them renting in the private sector) will be especially at risk; especially as David Willetts appears to be in favour of letting a few sink polyversities go bust rather than top slicing the whole sector. Leeds Met, Thames Valley, Bolton and a few other places that are effectively insolvent now could well be on borrowed time, IMO.

Edited by The Ayatollah Buggeri

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A lot of institutions put up halls of residence type blocks during the boom years. The ones started at the tail end of the boom are just coming on stream now. From what my students are telling me, there is now no supply problem for students in the Leeds. Hyde Park and Headingley attract a rent premium (because they're perceived as an attractive place to live by students), but whereas 2-3 years ago I'd occasionally hear about students struggling to find somewhere to live at all, now they're haggling on the rent. If the significant decrease in the overall student population that is likely to happen does happen, I'm very glad that I don't own a run-down terrace in Armley split into six bedrooms and rented out to students!

In addition to the institutions I mentioned there have been persistent rumours that Southampton Solent, Abertay Dundee and Hertfordshire have seriously overstretched themselves, attract no significanct research council income and are dead institutions walking if HEFCE-funded UK/EU student places are cut significantly and/or tuition fees increase. I've heard one-off mentions of a few others, too.

Edited by The Ayatollah Buggeri

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American graduates earn considerably more and the average American house costs much, much less at around 2.5 times average income, compared with 5 or 6+ in the UK.

They have far more land and their houses are made of wood. ;)

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Ah ... The Great UK Graduate Scam. I want to explode when I hear government mouthpieces being interviewed about tuition fees:

Graduates earn x times more than non-grads, so they should pay more fees!

... tell that to the recent graduates working in coffee houses and in factories earning £11K! Tell that to the recent graduates who are working in call centres earning £13K. I feel so sorry for these people ... the fees are quite ridiculous when you look at the REAL prospects they have! The UK doesn't need 200,000 graduates every year ... and anyone who disagrees needs to answer one question: WHY are companies suddenly adding the word "Graduate" to job titles? It's a scam! Employers are taking advantage of the skills that graduates have, but the wages are exactly the same as before!

The UK EDUCONOMY: The UK Higher Edumacation system directly supports hundreds of thousands of jobs, and millions of jobs indirectly ..... it cannot be allowed to fail!

Edited by Home_To_Roost

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The UK doesn't need 200,000 graduates every year ... and anyone who disagrees needs to answer one question: WHY are companies suddenly adding the word "Graduate" to non-graduate job titles?

Because universities are having to teach kids things that a generation ago they would have learnt in high school.

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To be fair, they probably don't earn 6 times what UK grads do. UK grads get anywhere from 18-25K these days if you're any good. Advise to American MBAs for example these days is take anything offered over $40K. That's not much different and an MBA is a postgrad.

Good UK graduates get £25k - £40k.

I got £17k in 1995 (accountancy firm) with a 2:1 from Manchester University, and I got paid overtime (not first 30 hours a quarter though).

My partner graduated two years later in 1997 and started on £25k (investment bank back office)

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A lot of institutions put up halls of residence type blocks during the boom years. The ones started at the tail end of the boom are just coming on stream now. From what my students are telling me, there is now no supply problem for students in the Leeds. Hyde Park and Headingley attract a rent premium (because they're perceived as an attractive place to live by students), but whereas 2-3 years ago I'd occasionally hear about students struggling to find somewhere to live at all, now they're haggling on the rent. If the significant decrease in the overall student population that is likely to happen does happen, I'm very glad that I don't own a run-down terrace in Armley split into six bedrooms and rented out to students!

The supply and demand of student accommodation led years ago to the situation where the University of Liverpool had the highest rate of failure for first year students.

This was said to be due to the University building more Halls of Residence than they needed. They filled them full of First Year students then ruthlessly thinned out the student numbers.

I am sure it was really done for the best reasons of academic achievement, not economic advantage.

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Some of them do. That's why the tuition fees at Harvard and UCLA are a lot higher than those of the community college at Buttfück, North Dakota. They charge what the market can bear.

As a Buttf*ck postgrad, who paid over twenty five dollars for his postal PhD, I resent the denigration of this venerable institution.

Edited by juvenal

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  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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