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People living in Britain

http://news.bbc.co.uk/1/shared/spl/hi/uk/0...ml/overview.stm

imm2001.GIF

There will be no houseprice crash.

For 30 years, a reasonable level of both immigration and population growth has seen a stable native population around the 53 million mark in relation to housing stock.

The last decade, between 1991 and 2001 saw a collosal change which renders all comparisions to the last bust useless as by 2001 the population climbed to 57 million, This became a central plank of Gordan Browns economic policy, and immigration controls were removed.

country_overview_graph_629.gif

This means all comparisons to the lawson bust are irrelevent as in economic terms wages are reduced as Labour has no bargaining power.

We have moved on from 2001. It is now 2005. Immigration has exploded much further from my observations it has easily doubled further from 2001 levels.

As chain migration speeds up, with no real controls, immigration can only snowball much much further.

Last year, on using past trend analysis, I forcast that rents would rise starting around now as eventually the elastic element of capacity was reduced. This has been happening recently.

The next stage is for houseprices to grow further as the credit market polarises, and credit is withdrawn from first time buyers/ordinary workers, who are forced to rent, and landlord investors see better and better credit terms.

Edited by brainclamp

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The next stage is for houseprices to grow further as the credit market polarises, and credit is withdrawn from first time buyers/ordinary workers, who are forced to rent, and landlord investors see better and better credit terms.

This is unfortunately a distinct possibility - as we get further and further past what should have been the crash point, the prospect that the ground rules really have changed becomes more likely.

However, a couple of weaknesses in your assessment:

1) Most immigrant labour is low skilled, and thus will be low paid and living in HMO's, with low rent yields & high hassle factor. Essentially 'slum landlord' territory. The actual impact of migrant labour on the housing supply side will be lessened due to the HMO factor.

2) Even with favourable credit terms, the ROI on property (even assuming a static housing market) in rental terms is poor compared with other classes (e.g. equities). If the market were to rise further, that ROI will only fall. Capital appreciation is not infinite.

Fundamentally, Property is overpriced as an asset class. It's like an overpriced stock delivering poor dividends - ultimately its market value will fall. Like any market, the housing market is not 100% rational and so corrections are capable of being out of time with returns.

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Last year, on using past trend analysis, I forcast that rents would rise starting around now as eventually the elastic element of capacity was reduced. This has been happening recently.

That's odd. I'm seeing rental properties around here stuck on the market and cutting rents to try to get a tenant... so much so that I'd be somewhat scared of renting one in case the landlord went bust due to subsidising their tenants for too long.

If rents are rising, it sure ain't around where I live.

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Yeah, but with lie-to-buy they can still get a 300k mortgage for a one-bed flat, or they can work a thousand hours a month to pay 5k in rent.

Edited by MarkG

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People living in Britain

http://news.bbc.co.uk/1/shared/spl/hi/uk/0...ml/overview.stm

People living in Britain 1971  1981  1991  2001

All people                  52,559,260  53,550,270  54,888,744  57,103,331

People born abroad    2,390,759  2,751,130  3,153,375  4,301,280

People born abroad as % of total  4.55  5.14  5.75  7.53

There will be no houseprice crash.

For 30 years, a reasonable level of both immigration and population growth has seen a stable native population around the 53 million mark in relation to housing stock.

The last decade, between 1991 and 2001 saw a collosal change which renders all comparisions to the last bust useless as by 2001 the population climbed to 57 million, This became a central plank of Gordan Browns economic policy, and immigration controls were removed.

country_overview_graph_629.gif

This means all comparisons to the lawson bust are irrelevent as in economic terms wages are reduced as Labour has no bargaining power. 

We have moved on from 2001. It is now 2005. Immigration has exploded much further from my observations it has easily doubled further from 2001 levels.

As chain migration speeds up, with no real controls, immigration can only snowball much much further.

Last year, on using past trend analysis, I forcast that rents would rise starting around now as eventually the elastic element of capacity was reduced. This has been happening recently.

The next stage is for houseprices to grow further as the credit market polarises, and credit is withdrawn from first time buyers/ordinary workers, who are forced to rent, and landlord investors see better and better credit terms.

Ehh, no. While immigration has risen during the last few years, once Mr Brown economic ' miracle' bursts, then the immigrants will all go home again, leaving me & you with the debt and recession.

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The next stage is for houseprices to grow further as the credit market polarises, and credit is withdrawn from first time buyers/ordinary workers, who are forced to rent, and landlord investors see better and better credit terms.

You've mentioned this before, banks aren't discriminating they will lend money where ever there is money to be made, if that's a naive FTB'er absolutely stretching themselves, then so be it. There is no basis for rationing, the BoE has created so much liquidity that the banks will lend to anyone and his dog.

I think the issue of immigration is a red herring, many are in a worse position than FTB'ers, unless each and every Polish barmaid earns £50k per annum they're in no position to enter the market.

What sort of investor would buy into a falling market? Anyone worth their salt would have done better in unit trusts over the past year.

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80% of immigrant workers are on £6 an hour or less?

Exactly, and I bet they're sending most of that back home

Most of them came over with just the clothes they were wearing, no possessions

Do you really think they're interested in a property?

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Guest Time 2 raise Interest Rates
That's odd. I'm seeing rental properties around here stuck on the market and cutting rents to try to get a tenant... so much so that I'd be somewhat scared of renting one in case the landlord went bust due to subsidising their tenants for too long.

yep, Property Group Savills warned today the new homes market had become

tougher,as individual investors [bTL] HOLD OFF DUE TO LOW RENTAL YIELDS.

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Yeah, but with lie-to-buy they can still get a 300k mortgage for a one-bed flat, or they can work a thousand hours a month to pay 5k in rent.

I think we praise ourself too much, why would somebody put in so much effort just to buy a pokey hovel in this great land, they could just work equally as hard in their native land and they would be equivalent millionaires.

It didn't stop the crash in '89 and it won't have any impact this time. On the periphery it may mean a few BTL landlords wil at least have tenants, not that will offset the drop equity or increased mortgage costs.

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IMD,

With respect as the Rachmans ("My tenants are scum") of this world have shown renting to the disadvantaged is a hugely profitable enterprise.

http://society.guardian.co.uk/childreninpo...,533314,00.html

Of course they weren't factoring in major price corrections to trend and I agree that property as an asset class could be seen to be massively overvalued.

The point is that slum housing in appaling conditions may not be overvalued if the only people willing and able to buy it are the slum landlords feeding like vultures on the public purse....

HMO (Houses of multiple occupation) are a particular niche of the market, in which if all the rules are followed - fire regs, fire doors etc the returns are lower than if the property is managed illegaly. I'm sure we have all read media reports of the conditions some of the "tenants" or "slaves" have to put up with.

http://www.social-exclusion-housing.com/private-slums.html

http://www.peoplenotprofit.co.uk/campaigns_landmark.htm

http://www.buzzle.com/editorials/2-19-2004-50771.asp

What the tragedy of the cockle pickers showed was that the government was both aware and unwilling to do anything about the rutheless exploitation of migrant workers. Nice to know we elected a progressive socialist party with an election where fewer people voted for the government than decided not to bother...

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has anyone seen the emigration figures........ :blink:

and someone on here wrote this a while back...

4. THERE'S A SHORTAGE OF HOUSING (SUPPLY is less than DEMAND)

The property pricing bubble has been running for around 4 years, however the has been no significant increase in population during this time, nor a decrease in the supply of property. In fact, we have a shrinking population and a rapidly increasing supply of new-build property. However, population change cannot have a significant affect on market pricing in such a short period of time anyway. What actually happened was that DEMAND INCREASED, creating an above-normal level of DEMAND, rather than a below-normal level of SUPPLY (as vested interests would have you believe). Most of this extra demand came through a combination of speculation due to price rises (e.g. BTL investment), leading to greater demand from owener-occupiers (fear that if they don't buy now the price rises will price them out forever). As soon as the market ran out of steam, and price began falling, the supply of new speculator evaporated, as did the "rushed" FTBs, exposing an actual OVER-SUPPLY in both property for sale and rental property.

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People living in Britain

http://news.bbc.co.uk/1/shared/spl/hi/uk/0...ml/overview.stm

People living in Britain 1971  1981  1991  2001

All people                  52,559,260  53,550,270  54,888,744  57,103,331

People born abroad    2,390,759  2,751,130  3,153,375  4,301,280

People born abroad as % of total  4.55  5.14  5.75  7.53

There will be no houseprice crash.

For 30 years, a reasonable level of both immigration and population growth has seen a stable native population around the 53 million mark in relation to housing stock.

The last decade, between 1991 and 2001 saw a collosal change which renders all comparisions to the last bust useless as by 2001 the population climbed to 57 million, This became a central plank of Gordan Browns economic policy, and immigration controls were removed.

country_overview_graph_629.gif

This means all comparisons to the lawson bust are irrelevent as in economic terms wages are reduced as Labour has no bargaining power. 

We have moved on from 2001. It is now 2005. Immigration has exploded much further from my observations it has easily doubled further from 2001 levels.

As chain migration speeds up, with no real controls, immigration can only snowball much much further.

Last year, on using past trend analysis, I forcast that rents would rise starting around now as eventually the elastic element of capacity was reduced. This has been happening recently.

The next stage is for houseprices to grow further as the credit market polarises, and credit is withdrawn from first time buyers/ordinary workers, who are forced to rent, and landlord investors see better and better credit terms.

Its a speculative market and now there are 2.6 people per "home" a decade ago there were 2.76

thats more available homes.

Its a speculative market

There are more homes.

Todays prices mean BTL have to subsidise rent.

the debt is forcing a recession.

House prices are driven by perception, nothing else.

The perception in all broadsheets is changing and prices are dropping.

As soon as the perception chages they drop.

They have here.

I was offered 20% of a new build..

That was before I haggled..

People expect high prices they rise.

too far..

fall...

and 40% of the imigration is in London...

sorry.. but thats not affecting us in Devon

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I agree, Last Hun, that exploiting the poor can be very profitable - but as you seem to agree, it only works when you a) buy property nobody wants for peanuts and then B) house the poor in them. However cheap property seems to hardly exist these days.

HMO... well, anecdotally, i've come across an Aussie who lived in a house with 20 people in it! (mostly 2 per bedrooom) and a Japanese lady who lives in a house of 8. Whether these are all 100% legal etc etc... I seriously doubt. But this is where the skint immigrants end up...

Immigration is a factor... but much of the young brains and money are leaving for fairer shores such as Canada and Oz. (I suspect I may do too, HPC or no HPC - I can go find one in Australia :) )

Clouds are forming on the UK's economic horizon, and it's a fool who denies this. Whether it turns into a storm or just cloudy weather is anyone's guess...

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and just because you spent £350,000 on a house does not mean that anyone moving in can afford the rent to cover your mortgage.

it would be nice.

but prices have risen beyound the point of affordability for either renting or buying.

and the economy cannot support this level of debt.

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Its a speculative market and now there are 2.6 people per "home" a decade ago there were 2.76

thats more available homes.

Isn't that less available homes

10 homes * 2.76 = 27.6 people per 10 homes

10 homes * 2.6 = 26 people per 10 homes - where did the other 1.6 people go?

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You can come out with many garbled and ill conceived ideas about why this huge expansion simply doesn't matter to the beloved house price crash, but the 10% growth in the population over such a short time span does matter massively.

It is set to grow again by yet another 10% within half the time of the first migration as it compounds upon itself! There are no limits.

It strikes me as the biggest contrick of all time. What are people working so hard and saving so hard for? A place to live?

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You can come out with many garbled and ill conceived ideas about why this huge expansion simply doesn't matter to the beloved house price crash, but the 10% growth in the population over such a short time span does matter massively.

It is set to grow again by yet another 10% within half the time of the first migration as it compounds upon itself! There are no limits.

It strikes me as the biggest contrick of all time. What are people working so hard and saving so hard for? A place to live?

Nobody doubts you have a point, everybody has to live somewhere, however the figures simply don't support fundermentals.

In 2003 and 2004 house prices rose more than 20% per annum, they're up over 100% since 1997, population growth simply doesn't justify these increases. BTL speculation alone is more of an determining factor than immigration.

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You can come out with many garbled and ill conceived ideas about why this huge expansion simply doesn't matter to the beloved house price crash, but the 10% growth in the population over such a short time span does matter massively.

It is set to grow again by yet another 10% within half the time of the first migration as it compounds upon itself! There are no limits.

It strikes me as the biggest contrick of all time. What are people working so hard and saving so hard for? A place to live?

Nope.. not in devon..

Infact an awful lot of new builds getting discounted as they are not selling..

loads.. but still no takers..

Not quite yet..

yawn.. imigration... 10% popultion growth..

where exactly and where does this imigration earn £45,000 a year .. enough to buy a home..

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Last year, on using past trend analysis, I forcast that rents would rise starting around now as eventually the elastic element of capacity was reduced. This has been happening recently.

There has been hype about rising rents but I suspect this is pure spin. Some landlords are accepting massive discounts (I know that for a fact). In my last property, I was paying the same rent that had been charged in 2001. Since I left 4 months ago and the property has remained empty even though the asking price for rental has been reduced by a further 10%.

The rental market is getting hammered.

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but the 10% growth in the population over such a short time span does matter massively.

It doesn't matter a damn, if low-paid immigrants are being packed five or six to a room to save money... particularly when lots of British people are emigrating and leaving large houses behind them. One British family of four leaving the country and selling their three-bed house has just made enough room for a dozen or more low-paid immigrants.

Talking about immigration forcing house prices up is pointless if you just look at the numbers and ignore what they're earning.

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The UK’s population is projected to rise by 6.1 million from 2003 to 2031 – 5.2 million (84%) of this rise is due to immigration.[2] That’s equivalent to a city the size of Portsmouth every year, or 5 cities the size of Birmingham over the 28 year period, needing to be built because of immigration.[3]

•  59,000 new homes will be required in England each year for the next 17 years for immigrants.[4]

• In 2003 12.2 million non-EU nationals arrived in the UK[5]. How many left? No one knows – we have no embarkation controls.

• In Inner London 55% of all births are to foreign-born mothers. [6]

•  70% of net international migration is to London. In recent years a net 100,000 migrants a year have been arriving in London and there has been a net movement of 100,000 existing residents from London to the rest of the UK.[7]

•  The cost of running the Immigration and Nationality Department of the Home Office rose from £300 million in 1998-1999 to 1.9 billion in 2003-4.[8] Legal aid costs of £170m a year are additional.

• England is one of the most densely populated countries in the world. It has nearly twice the population density of Germany, 4 times that of France and 12 times that of the USA.

•  Since 1997 about 308,000 asylum seekers have been refused permission to stay here but only 72,000 have been recorded as having been removed from the UK. [9]

•  And those with families whose claims have failed continue to receive benefits worth an average of £15,000 a year tax free.[10] 

With some immigrants working for pitance there are massive profits to be made however the tax payer has to fund the downside of benefits for those not working, social housing, crime, NHS tourism etc etc It's the old story of privatising the profits and socialising the costs.

IMHO immigration is bound to have an inflationary effect on house prices effectively fuelling the boom. That doesn't mean that the boom can go on indefinately the bubble will eventually burst.

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QUOTE

''We have moved on from 2001. It is now 2005. Immigration has exploded much further from my observations it has easily doubled further from 2001 levels.''

To some extent this is true but what about all the people (and I personally know of a few) who are emigrating...

Also what about the fact that many immigrants live ten to one small room.......

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Just a personal observation...

In my job we bring hundreds of overseas nationals into this country - clients and workers with skills in short supply - in times of boom work. Most of these people live in fairly cheap rental accomodation and go back home after a year or 18 months max. They aren't interested in buying a place in the UK. I observe this in a lot of other companies as well. If a recession hits many of these people will go home again (just as so many Americans left the UK after the dotcom / IT bust).

We also have literally dozens of Polish manual labourers working for us as subcontractors. They just want to live here as cheaply as possible, make a pile of money and go home.

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The clients and skills 'in short supply' are precisely the reason why you will carry on seeing houseprices and rents rise and rise and rise!

The BOE is printing vast quantities of money, which is expanding corporate profits, which should be driving wages higher. But the moment the labour pool tightens and wages start to rise more immigration visas are sanctioned, driving down wages.

With the population haven risen by 10% from 1997 and 1 in 13 people 'born abroad' you have little chance of seeing Houspeprices come down unless rising raw material prices finally make the BOE stop printing money.

There are now no limits on immigration.

Due to factors like chain migration I would say the population is/has grown again by another 10% from 2001 - we simply don't know. When does it stop?

Edited by brainclamp

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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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