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marko

The Decline Of Owner-occupancy

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The mortgage (literally "death-loan" - remember your French? Look at the word...it is a portmanteau) is the principle mechanism by which those awful parasites the banks supply their magic non-existant money (through fractional reserve banking) into the economy.

In the UK, the number of so-called 'owner-occupiers' (people in a house they call their own who may or may not have a mortgage) has risen steadily - from 42% in 1960 to 66% in 1996. This rise in 'owner-occupiers' is what has given rise to the popular conception that we have become a property-owning society.

But of course if you have a mortgage on your house, then it is the bank who owns the property (or at least the portion that is mortgaged...which nowadays is the majority, if not all in the case of interest-only, of the value of the house). You do NOT own the house. Where are the title deeds? At the bank.

And this is where it gets interesting. If we look at the same period as above (1960 - 1996) the proportion of houses owned OUTRIGHT, with no mortgage, dropped from 51% TO 35%. Basically despite decades of paying crippling mortgage repayments, the proportion of houses owned outright has actually fallen!

The banks own a gradually larger and larger amount of the housing stock! IF YOU HAVE A MORTGAGE THE BANK OWNS THE HOUSE, NOT YOU. We all like to think that we are becoming a nation of homeowners.....the reality is sickeningly different. From 1960 to 1996 the percentage of housing under mortgage (basically what the banks own) has increased from 19% to 37%.

The banks own more of the housing stock now than ever before...and this is a direct consequence of the manner in which money is supplied to the economy - by fractional reserve banking. They have also pumped the economy with so much magic money that housing is now much more expensive - in the 1960s it was averaging 2.9 times the average salary.

I know everyone here is concerned about house prices...I would suggest that people dig a little deeper and realise that the bubble is largely a consequence of the ridiculous debt-based financial system we operate in. This really needs to change.

Edited by marko

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Heh, someone the other day posted a link to an article that said something like "in the next 10 years our nation will be 73% richer". It seems more likely that we wil be 73% more in debt and the banks will be 73% richer.

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I just want to know when this ridiculous situation is going to end. We are in hock to the banks to such a degree that people no longer even notice. Some observers (the ones who see the truth) actually think that if the trend of the last few decades continues, the days of actually owning your own house are numbered. See the Japanese example, with 99 year mortgages.

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The mortgage (literally "death-loan" - remember your French? Look at the word...it is a portmanteau) is the principle mechanism by which those awful parasites the banks supply their magic non-existant money (through fractional reserve banking) into the economy.

In the UK, the number of so-called 'owner-occupiers' (people in a house they call their own who may or may not have a mortgage) has risen steadily - from 42% in 1960 to 66% in 1996. This rise in 'owner-occupiers' is what has given rise to the popular conception that we have become a property-owning society.

But of course if you have a mortgage on your house, then it is the bank who owns the property (or at least the portion that is mortgaged...which nowadays is the majority, if not all in the case of interest-only, of the value of the house). You do NOT own the house. Where are the title deeds? At the bank.

And this is where it gets interesting. If we look at the same period as above (1960 - 1996) the proportion of houses owned OUTRIGHT, with no mortgage, dropped from 51% TO 35%. Basically despite decades of paying crippling mortgage repayments, the proportion of houses owned outright has actually fallen!

The banks own a gradually larger and larger amount of the housing stock! IF YOU HAVE A MORTGAGE THE BANK OWNS THE HOUSE, NOT YOU. We all like to think that we are becoming a nation of homeowners.....the reality is sickenly different. From 1960 to 1996 the percentage of housing under mortgage (basically what the banks own) has increased from 19% to 37%.

The banks own more of the housing stock now than ever before...and this is a direct consequence of the manner in which money is supplied to the economy - by fractional reserve banking. They have also pumped the economy with so much magic money that housing is now much more expensive - in the 1960s it was averaging 2.9 times the average salary.

I know everyone here is concerned about house prices...I would suggest that people dig a little deeper and realise that the bubble is largely a consequence of the ridiculous debt-based financial system we operate in. This really needs to change.

Sounds like you are on the same chapter of Rowbotham (The Grip of Death, available on Amazon) as I am, after our FRB thread last week. Thanks to North London Rent Girl for the recommendation.

I would encourage everyone to read this account of our financial system. It is truly eye-opening to be told in blunt terms what the impact of our banking system is upon our daily lives.

I worked in banking for 4 years and often felt bewildered by the things I was confronted with. Management do not understand the banking system fully and were incapable of putting things in their correct perspective.

I can tell you for a fact that even those working within the banking system at a senior level are rarely aware of the implications of the system they help to manage.

Ignorance is NOT bliss. It is a living hell at the moment.

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Sounds like you are on the same chapter of Rowbotham (The Grip of Death, available on Amazon) as I am, after our FRB thread last week. Thanks to North London Rent Girl for the recommendation.

I would encourage everyone to read this account of our financial system. It is truly eye-opening to be told in blunt terms what the impact of our banking system is upon our daily lives.

I worked in banking for 4 years and often felt bewildered by the things I was confronted with. Management do not understand the banking system fully and were incapable of putting things in their correct perspective.

I can tell you for a fact that even those working within the banking system at a senior level are rarely aware of the implications of the system they help to manage.

Ignorance is NOT bliss. It is a living hell at the moment.

Dear Smell,

Yes indeed! After the major argument about FRB I decided to follow North_Londons advice - I also got the Future of Money by Bernard Lietaer (not opened it yet but apparently it is a good read).

On that last thread I was almost shaken by el zorro's excuses for FRB, but I am confident I can shoot down any argument for it now...it is simply unbelievable how crooked this whole thing is. Unbelievable. Do you know of any monetary reform groups that are currently operating nowadays? Monetary reform was really popular a hundred years ago (I read that the reason Lincoln was assasinated was because he wanted to abolish FRB), but now it seems to be quiet. If there is a movement, I want to get involved - I really see this as possibly the Fulcrum on which most of today's shit is balancing.

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Dear Smell,

Yes indeed! After the major argument about FRB I decided to follow North_Londons advice - I also got the Future of Money by Bernard Lietaer (not opened it yet but apparently it is a good read).

On that last thread I was almost shaken by el zorro's excuses for FRB, but I am confident I can shoot down any argument for it now...it is simply unbelievable how crooked this whole thing is. Unbelievable. Do you know of any monetary reform groups that are currently operating nowadays? Monetary reform was really popular a hundred years ago (I read that the reason Lincoln was assasinated was because he wanted to abolish FRB), but now it seems to be quiet. If there is a movement, I want to get involved - I really see this as possibly the Fulcrum on which most of today's shit is balancing.

Marko

I think Rowbotham mentions that the last 3 decades of history are remarkable in their lack of monetary reform groups.

Now is certainly the time to reverse that trend.

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Marko

I think Rowbotham mentions that the last 3 decades of history are remarkable in their lack of monetary reform groups.

Now is certainly the time to reverse that trend.

Then I am going to have a serious shufty around...see what I can find. I would have imagined that these financial reform 'cancel the IIIrd world debt' Bono etc. types would want to abolish FRB, but I could not find any mention of it on a website or two I visited.

If I find nothing, then I am seriously considering organising something.

The thought of the bankers riding the backs of the rest of us makes my blood boil. If EVER I get to own a house, bankers will not be welcome in it! :angry:

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Dear Smell,

Yes indeed! After the major argument about FRB I decided to follow North_Londons advice - I also got the Future of Money by Bernard Lietaer (not opened it yet but apparently it is a good read).

On that last thread I was almost shaken by el zorro's excuses for FRB, but I am confident I can shoot down any argument for it now...it is simply unbelievable how crooked this whole thing is. Unbelievable. Do you know of any monetary reform groups that are currently operating nowadays? Monetary reform was really popular a hundred years ago (I read that the reason Lincoln was assasinated was because he wanted to abolish FRB), but now it seems to be quiet. If there is a movement, I want to get involved - I really see this as possibly the Fulcrum on which most of today's shit is balancing.

Thier is an organisation called the new economics foudation, it used to be called jubilee 2000. They have a website and work with some eminent proffesors. They have had some success changing the thinking of one local authority who now employs one off NEF's people full time. They have also been in some of the less important backrooms of the Labour Party Conference. They are making slow progress but could do with all the support they can get.

Do a search with NEF to find thier website!.

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Then I am going to have a serious shufty around...see what I can find. I would have imagined that these financial reform 'cancel the IIIrd world debt' Bono etc. types would want to abolish FRB, but I could not find any mention of it on a website or two I visited.

If I find nothing, then I am seriously considering organising something.

The thought of the bankers riding the backs of the rest of us makes my blood boil. If EVER I get to own a house, bankers will not be welcome in it! :angry:

See my Affordable Housing Campaign thread. In my opinion monetary reform or at least regulation of credit (particularly mortgages) should be a central plank of any charter for such an organisation.

I firmly believe that easy credit has created this situation, along with government meddling in monetary policy (in particular the scandal of HPI being excluded from inflation measures).

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Ask any drug taker if they would be upset if their drug supply was to be interrupted and they would all say yes and this is just what’s happening to all those hocked on debt so although we can see the errors of their ways, they can not

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IMHO the decline of owner occupancy is not actually a bad thing. There should be a readily available supply of different types of occupancy which people can choose from. Successive governments have shoved owner occupancy in our faces to such an extent that sheeple now see no different way of living.

As the lead comment points out, purchasing a property immediately puts you in a significant amount of debt. The purchaser does OWN the property but it is subject to a mortgage which, in certain circumstances (ie non payment of the instalments) will result in possession proceedings.

However, my piont is that renting keeps you out of debt and it should be championed much more than is currently the case. Housing Association and Local Authority accommodation should be far more widely available and the Government should seriously consider promoting this type of accommodation. A few press releases about cheap rents and effective management of housing stock may well turn people's opinion away from owner occupancy. Other countries rent well - why not ours?

Finally, down the road from where I work is a local housing co-op. Have a think about the benefits of co-operative occupancy.

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Guest Charlie The Tramp
And this is where it gets interesting. If we look at the same period as above (1960 - 1996) the proportion of houses owned OUTRIGHT, with no mortgage, dropped from 51% TO 35%. Basically despite decades of paying crippling mortgage repayments, the proportion of houses owned outright has actually fallen!

That`s where all the money came from to buy all those homes in the sun, the second homes in the UK, and the one upmanship cars on the driveways. <_<

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IMHO the decline of owner occupancy is not actually a bad thing. There should be a readily available supply of different types of occupancy which people can choose from. Successive governments have shoved owner occupancy in our faces to such an extent that sheeple now see no different way of living.

As the lead comment points out, purchasing a property immediately puts you in a significant amount of debt. The purchaser does OWN the property but it is subject to a mortgage which, in certain circumstances (ie non payment of the instalments) will result in possession proceedings.

However, my piont is that renting keeps you out of debt and it should be championed much more than is currently the case. Housing Association and Local Authority accommodation should be far more widely available and the Government should seriously consider promoting this type of accommodation. A few press releases about cheap rents and effective management of housing stock may well turn people's opinion away from owner occupancy. Other countries rent well - why not ours?

Finally, down the road from where I work is a local housing co-op. Have a think about the benefits of co-operative occupancy.

It is currently government policy to encourage private sector activity in the housing market. Hence the changes to tenancy law which have allowed the BTL sector to flourish.

Like everything else, the local authority housing sector is being privatised. Market forces are regarded as a magical cure-all.

Personally I have no real problem with this. There are some benefits, e.g. poorer people can end up living in BTL property in pleasant areas they couldn't have afforded previously.

The problem I do see is that easy credit has fuelled rampant speculation in the housing market. Credit restrictions are required for housing, to stabilise the market and prevent the social disruption that has been caused by the current boom.

There should also be more options for long leases, so that tenants have greater security of tenure. Living with the possibility of upheaval every 6 months is ok for the young, but highly undesirable for families with school age children, and elderly people.

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It is currently government policy to encourage private sector activity in the housing market. Hence the changes to tenancy law which have allowed the BTL sector to flourish.

Like everything else, the local authority housing sector is being privatised. Market forces are regarded as a magical cure-all.

Personally I have no real problem with this. There are some benefits, e.g. poorer people can end up living in BTL property in pleasant areas they couldn't have afforded previously.

The problem I do see is that easy credit has fuelled rampant speculation in the housing market. Credit restrictions are required for housing, to stabilise the market and prevent the social disruption that has been caused by the current boom.

There should also be more options for long leases, so that tenants have greater security of tenure. Living with the possibility of upheaval every 6 months is ok for the young, but highly undesirable for families with school age children, and elderly people.

The Government has no policy. It's housing minister is incapable to sorting anything out. The only thing this Government can do is float in a turbulent sea with sails billowing in a strong wind blowing in a very uncomfortable direction.

In fact there has been no housing policy for at least 50 years. The last housing policy that had any merit came out of the great social changes of the late 1940's (Beveridge et al).

Housing policy today consists of John Prescott spouting out about "key workers" and how they are going to biuld loads of new places for them to live.

Absolute crap!

Housing policy should have addressed speculative buying years ago.

But that is another thread..........

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The Government has no policy. It's housing minister is incapable to sorting anything out. The only thing this Government can do is float in a turbulent sea with sails billowing in a strong wind blowing in a very uncomfortable direction.

In fact there has been no housing policy for at least 50 years. The last housing policy that had any merit came out of the great social changes of the late 1940's (Beveridge et al).

Housing policy today consists of John Prescott spouting out about "key workers" and how they are going to biuld loads of new places for them to live.

Absolute crap!

Housing policy should have addressed speculative buying years ago.

But that is another thread..........

I'm not arguing that they have an effective policy. But they definitely do want further private involvement. From the ODPM in 2001 (i.e. Prescott):

"Despite the Government's wish to draw large-scale company landlords and institutional investment into the private rented sector as a means of guaranteeing better standards of management and maintenance, the number of company and large-scale landlords appears to have been declining. Instead the sector is increasing dominated by small-scale private individual landlords renting property as a sideline activity."

Obviously, the large corporates displayed no interest. In fact they have taken profits and left the sector, leaving the naive amateurs holding the baby.

I almost feel sorry for them as I write this.

see ODPM for more on this.

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I'm not arguing that they have an effective policy. But they definitely do want further private involvement. From the ODPM in 2001 (i.e. Prescott):

"Despite the Government's wish to draw large-scale company landlords and institutional investment into the private rented sector as a means of guaranteeing better standards of management and maintenance, the number of company and large-scale landlords appears to have been declining. Instead the sector is increasing dominated by small-scale private individual landlords renting property as a sideline activity."

Obviously, the large corporates displayed no interest. In fact they have taken profits and left the sector, leaving the naive amateurs holding the baby.

I almost feel sorry for them as I write this.

see ODPM for more on this.

Right. No effective policy.

Actually any policy to "bring on board" private landlords is almost certainly a complete waste of time now. There is a significant number of small time BTL landlords that it would be impossible for them to have a unified voice. Just imagine how many BTLers are members of the Association of Private Landlords or the National Landlords Association. Very few is my guess.

I think the issue of a national landlord association is an interesting issue which merits a new topic. There are a number of concurrant issues...BTL and knowledge of the law....BTL and voluntary local authority schemes...etc.

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The banks own a gradually larger and larger amount of the housing stock! IF YOU HAVE A MORTGAGE THE BANK OWNS THE HOUSE, NOT YOU.

This is clearly untrue. There's a simple test to apply. If the value of the house goes up by £50,000 then who makes the money? If the value of the house goes down by £50,000 then who loses the money? That person is the owner, and it's not the bank.

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This is clearly untrue. There's a simple test to apply. If the value of the house goes up by £50,000 then who makes the money? If the value of the house goes down by £50,000 then who loses the money? That person is the owner, and it's not the bank.

Your logic holds if people never sell or remortgage. As the housing stock changes hands over the years the new owners take out large mortgages, and recently there has been a huge amount of MEWing going on.

The result is that a larger proportion of the "value" of housing (i.e. average house price x number of houses) is financed by debt supplied by banks.

The point is that a much larger proportion of the "value" of housing is in the form of bank debt, so effectively belonging to the bank (they have first call on the asset to reclaim their debt if you can't pay the mortgage).

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This is clearly untrue. There's a simple test to apply. If the value of the house goes up by £50,000 then who makes the money? If the value of the house goes down by £50,000 then who loses the money? That person is the owner, and it's not the bank.

If you stop paying £x amount each month who eventually gets the house?

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Personally I have no real problem with this. There are some benefits, e.g. poorer people can end up living in BTL property in pleasant areas they couldn't have afforded previously.

That may be the case now STF but 10 years ago those same poor people could have easily afforded to buy the property in the pleasant area. So really BTL have done no favours to anyone but themselves.

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That may be the case now STF but 10 years ago those same poor people could have easily afforded to buy the property in the pleasant area. So really BTL have done no favours to anyone but themselves.

I mean genuinely poor people - families on housing benefit for example, who could never really afford to buy. Admittedly they are in the minority, but they do exist.

My point was that if credit was controlled and tenants had better rights, BTL would be less prolific, prices would be lower and people could afford to buy for their own occupation.

The bubble has been pumped up by easy credit, supplemented by a large number of people prepared to lie to borrow large sums for speculation purposes.

These speculators were attracted in large part by reforms to tenancy laws which made the assured short hold tenancy (highly favourable to amateur landlords) the industry norm.

This in turn forces would-be owner occupiers to borrow heavily to compete for these properties, and sometimes to resort to the same dishonesty.

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Your logic holds if people never sell or remortgage. As the housing stock changes hands over the years the new owners take out large mortgages, and recently there has been a huge amount of MEWing going on.

That proves my point. If you didn't own your mortgaged house, you couldn't use its increased value as security for a larger loan, as the increase in value would go to the owner and not to you.

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  • 301 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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