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Jimmy_James

Ftb Summit 'dumbfoundingly Stupid'

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Nice comment piece in today's Guardian

http://www.guardian.co.uk/money/blog/2011/feb/15/first-time-buyer-summit

Unfortunately, PricedOut didn't get an invite to the much vaunted first-time buyers summit being held by the government today – we tweeted housing minister Grant Shapps with no luck, and his private office told us they had no space to include any first-time buyers in the room, which is odd given the subject matter.

Odd but no great surprise. First-time buyers have become accustomed to being cited but not heard. For the past 10 years the use of the phrase "helping first-time buyers" has increased in inverse proportion to the darkening of most 20- and 30-somethings' housing prospects.

We thought that after 10 years of Labour "initiatives" (anyone fancy owning 25% of an overpriced executive apartment?) disguising the worst record on housing affordability in post-war history the coalition government might be a refreshing change.

Up until now things had been promising – lots of attacks on Brown's housing bubble and an unprecedented statement from a housing minister saying that rising house prices might not be such a good thing after all.

Perhaps we hoped that, if not welcoming lower prices, the coalition wouldn't spend so much time trying to stop them from falling. And letting them fall makes sense. We're currently stuck in zombie land: banks are well aware that house prices are overvalued and aren't lending to first-time buyers at anything other than highly unfavourable rates, partly because they are trying to protect themselves against future price falls.

Lending isn't going to return until house prices start looking sensible again.

Letting prices fall is also the easiest way to make houses affordable – the stated objective of the government – for people who can't get on the ladder. But give a minister a chance to include first-time buyers in a press release and it's an open invitation to do something dumbfoundingly stupid.

The pre-summit narrative went something like this: we've inherited a terrible mess, had "the biggest housing boom" (so said Cameron), prices got way out of kilter, and "mortgage companies were allowed to go basically crazy" (said Shapps), so we would now soberly learn the lessons of the credit crunch. So far so good.

But what are the touted summits actual solutions? The wish list now is to a) pressure the banks to lend to first-time buyers at current prices; B) encourage "innovative products" for first-time buyers to buy 25% of these same properties; and c) look to get government or the private sector to provide "insurance" for risky lending by banks to first-time buyers.

The solution to a crisis created by loose lending is, it would appear, more loose lending.

Whatever else these policies may achieve, two sure-fire outcomes are a) to increase the short-term upward pressure on house prices; and B) to increase the stock of risky lending on the books of either the government or government-supported mortgage lenders (or to paraphrase, the taxpayer). The end result is that hundreds of thousands of young people lose out. They either make a very poor (government-sponsored) financial decision or don't qualify for the new schemes and see prices stick stubbornly at sky high levels.

What are we to make of a government that offers such ill conceived help? Has it struggled to learn lessons from the credit crunch? Is the government economically illiterate? Or are we suffering from a combination of institutional capture set against a backdrop of the fetishisation of house prices in the British psyche?

Politicians are scared of challenging the house price beast, and the only people who are offering them practical advice are happy with the status quo. So the politics of housing nearly always relegates the interests of first-time buyers (otherwise known as the consumer) below well represented lobbyists – be they mortgage lenders, house builders or housing associations.

The government has been captured by these groups for so long that any "innovative solutions" become shaped by their interests – hence the dusting down of shared ownership or specialised lending. No one in government bothers to ask "is this in the interests of first-time buyers?" anymore.

As young first-time buyers are dispersed, less likely to vote and much less politically visible, this charade goes happily on. To get change we are going to have to mobilise. If you are also unhappy about it, join us and start campaigning.

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Unfortunately, PricedOut didn't get an invite to the much vaunted first-time buyers summit being held by the government today – we tweeted housing minister Grant Shapps with no luck, and his private office told us they had no space to include any first-time buyers in the room, which is odd given the subject matter.

Something that should be given full airing on all the social networks to let the younger generation know exactly where their governments think of their views.

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.. his private office told us they had no space to include any first-time buyers in the room

I love that - sounds like the sort of crap I tell my kids when the truth's too awkward.

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Does anyone know when we are going to find out about the outcomes of this summit?

* There will be strict limits on income multiples for all new mortgages/remortgages.

* BTL mortgages will only be allowed with 75% LTV and 125% rental coverage (repayment terms)

* There will be a major program of council house building to increase supply and 'encourage' the movement of BTL stock to First time buyers.

* Banks will be forced to be forced to liquidate the 'portfolios' of insolvent BTL landlords.

* An 'excess room tax' will be introduced to encourage empty-nesters to downsize, allowing families to move into larger houses and free up more FTB stock.

* A detachment of flying pigs will be engaged to monitor the results of this policy.

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I'm suprised there hasn't been more of an uprising amongst people.

Why haven't we seen protests like what happened with the uni fees?

I suspect because there were real £ numbers attached to the tuition fees whereas an over inflated price for the potential purchase of a house at some indeterminate point in the future is immaterial, intangible and mostly irrelevant to most young people.

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Does anyone know when we are going to find out about the outcomes of this summit?

We are not.

The Government will use it to waffle about 'trying to help FTBs'

The Banks will waffle about being 'Listening'

Nobody will ever say if anything was agreed and if so what it was.

That was not the purpose of the meeting, it was held to deflect criticism.

One of those 'Yes, Minister' type civil servants will now be typing up all sorts of long worded, confusing statements to use if the Minister is ever challenged about the meeting.

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As the FTB median age blasts through the psychologically important 40 barrier, at what point will these dickheads wake up and realise that there is a serious ******ing problem here? Where no-one having kids is able to get onto the housing market as anything other than a serf?

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.. his private office told us they had no space to include any first-time buyers in the room

Don't they have a bigger room?

I mean, it's not knobbing rocket science.

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As the FTB median age blasts through the psychologically important 40 barrier, at what point will these dickheads wake up and realise that there is a serious ******ing problem here? Where no-one having kids is able to get onto the housing market as anything other than a serf?

Great Post.

The only way to get housing is either to have a fantastic job, or claim to have no job and use a child to blackmail the benefits people into paying for you to have somewhere to live. Those with fantastic paying jobs are always exploting others in some way or another.

Meanwhile, those who work hard, have to pay more and more and more and taxes so that other people can live in housing that they cannot themselves afford.

I am reaching the point where I would be happy to go on a demo of some sort to stop this madness.

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I am reaching the point where I would be happy to go on a demo of some sort to stop this madness.

Of course, I also forgot to mention that once you hit 41 no one will lend you money on a 25 year mortgage.... That's REALLY going to help out those FTBs!

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Of course, I also forgot to mention that once you hit 41 no one will lend you money on a 25 year mortgage.... That's REALLY going to help out those FTBs!

Is it not from the age of 40, rather than 41? Or have they shifted it by one year to reflect the change from 65 to 66 for when you start to receive your (state) pension?

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  • 312 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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