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Gideons H P I Package Will Subsidize Builders

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http://www.guardian.co.uk/business/2011/mar/27/firstbuy-scheme-fears-falling-property-market

Firstbuy could lock young homebuyers into falling property marketScheme designed to help cash-strapped first-time buyers could subsidise housebuilders, analysts warn
Campaigners are warning that George Osborne's "Firstbuy" scheme to help cash-strapped young voters onto the property ladder is a subsidy for housebuilders that could lock vulnerable buyers into a falling market.
The £250m scheme, under which homebuyers with a 5% deposit will be able to borrow a further 20% of the price of a new home from the government and housebuilders, was one of the few giveaways in the chancellor's second budget last Wednesday.
But the independent Office for Budget Responsibility expects house prices to fall by 2.3% this year, and grow by just 0.1% the year after, and many analysts are expecting sharper declines...../

Exactly. Only the market will not fall by anywhere near 2.3% this year. It may fall that much in one month this year and even that is enough to say to FTBs hold the line and wait for AT LEAST 20% off this year's prices.

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Firstbuy could lock young homebuyers into falling property market

Scheme designed to help cash-strapped first-time buyers could subsidise housebuilders, analysts warn

:o

Surprisingly clear vision, despite going against the usual popular beliefs in these past years.

Pity the Guardian didn't "see" that when Brown implemented similar schemes.

:angry:

Edited by Tired of Waiting

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:o

Surprisingly clear vision, despite going against the usual popular beliefs in these past years.

Pity the Guardian didn't "see" that when Brown implemented similar schemes.

:angry:

At least for once the pressure is on our side. I'm suprised so many people are seeing through this scheme. I'm sure all our efforts at letter writing and the spendid work of priced out have helped to educate the masses and build opposition for this.

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At least for once the pressure is on our side. I'm suprised so many people are seeing through this scheme. I'm sure all our efforts at letter writing and the spendid work of priced out have helped to educate the masses and build opposition for this.

Or just maybe the tide has turned on the debt=wealth message.

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Or just maybe the tide has turned on the debt=wealth message.

People stopped buying that when Clegg tried to sell student fee hikes on the basis that monthly loan repayments would be lower. I think that policy caused an awakening.

I don't think the pols and their pollsters have understood this yet

Edited by mdman

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At least for once the pressure is on our side. I'm suprised so many people are seeing through this scheme. I'm sure all our efforts at letter writing and the spendid work of priced out have helped to educate the masses and build opposition for this.

Sure, no doubt about that. It is great news. The tide is turning in our favour.

I just couldn't resist noticing the clarity of vision that has suddenly afflicted The Guardian. :P

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:o

Surprisingly clear vision, despite going against the usual popular beliefs in these past years.

Pity the Guardian didn't "see" that when Brown implemented similar schemes.

:angry:

+ 1, how true, but not 'unexpected'!

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I don't know how unexpected.

"Patrick Collinson, editor, Jobs&Money Saturday 28 May 2005

The only good thing to be said about the government's current enthusiasm for part-buy, part-rent shared ownership is that its scheme will fail.

The government is promising to help more than 100,000. But cut through the spin (earlier key-worker schemes repackaged) and the additional numbers helped under the measures announced this week will be 20,000 households.

In a normal year there are around one million property transactions in Britain. Helping 20,000 first-time buyers in a country with a population of 60m people is hardly addressing the problem.

And thank goodness for that - because shared ownership does not offer a long-term, socially just solution. If it is promoted on any sort of scale it will burden the young with potentially unaffordable mortgages (has everyone forgotten interest rates at 15% in 1989?), conning them that this is the first step on the ladder. The new buyers drawn in, many on unstable incomes, will find it difficult if not impossible to move up the ladder, and if they default will be ruined financially for years.

The beneficiaries will be the already well-off, who need the cash from first-time buyers to keep the fires burning in our ludicrously inflated house price market.

Supporting first-time buyers like this, we could end up with even higher house prices as an artificial floor is created."

And so on.

http://www.guardian.co.uk/money/2005/may/28/firsttimebuyers.homebuying2?INTCMP=SRCH

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I don't know how unexpected.

"Patrick Collinson, editor, Jobs&Money Saturday 28 May 2005

The only good thing to be said about the government's current enthusiasm for part-buy, part-rent shared ownership is that its scheme will fail.

The government is promising to help more than 100,000. But cut through the spin (earlier key-worker schemes repackaged) and the additional numbers helped under the measures announced this week will be 20,000 households.

In a normal year there are around one million property transactions in Britain. Helping 20,000 first-time buyers in a country with a population of 60m people is hardly addressing the problem.

And thank goodness for that - because shared ownership does not offer a long-term, socially just solution. If it is promoted on any sort of scale it will burden the young with potentially unaffordable mortgages (has everyone forgotten interest rates at 15% in 1989?), conning them that this is the first step on the ladder. The new buyers drawn in, many on unstable incomes, will find it difficult if not impossible to move up the ladder, and if they default will be ruined financially for years.

The beneficiaries will be the already well-off, who need the cash from first-time buyers to keep the fires burning in our ludicrously inflated house price market.

Supporting first-time buyers like this, we could end up with even higher house prices as an artificial floor is created."

And so on.

http://www.guardian.co.uk/money/2005/may/28/firsttimebuyers.homebuying2?INTCMP=SRCH

OK, not bad, very good article indeed.

But was it an indication of the general Guardian line at the time, or an exception to the rule?

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OK, not bad, very good article indeed.

But was it an indication of the general Guardian line at the time, or an exception to the rule?

There hasn't been, to my eyes, a consensus at the Guardian. In terms of regular reporters/columnists, Lisa Bachelor seemed to be a fan, Huma Qureshi neutral shading to thinking it a good scheme for some, Miles Brignall not a fan and Patrick Collinson definitely against.

There have been various news stories, Q&A's and opinion pieces, and a number of warnings about the drawbacks of such schemes from their inception until the present

A scheme only good in parts

Home hunter Gareth Rubin discovers some of the drawbacks to shared ownership

The Observer, Sunday 30 October 2005

http://www.guardian.co.uk/money/2005/oct/30/firsttimebuyers.property?INTCMP=SRCH#

Homes that prove a shared burden

First-time buyers can no longer afford part-own, part-rent deals - and those who took them up may face problems, says Karen Dugdale

The Observer, Sunday 30 November 2008

http://www.guardian.co.uk/money/2008/nov/30/firsttime-buyers-shared-ownership

Beware the true cost of a shared-ownership home

Why buy 50% of a property when you could afford 100% in a downturn?

Patrick Collinson

Saturday 31 July 2010

http://www.guardian.co.uk/money/blog/2010/jul/31/beware-cost-shared-ownership?INTCMP=SRCH

Shared ownership schemes: still a stretch to get on the ladderPart-buy, part-rent schemes promise to fulfil the dreams of first-time buyers. But they're not a low-cost option

Ruth Lythe

The Guardian, Saturday 5 March 2011

http://www.guardian.co.uk/money/2011/mar/05/shared-ownership-schemes?INTCMP=SRCH

Oh, and the Guardian let Matt Griffith of PricedOut have the Money Blog on 15 February 2011

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

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There hasn't been, to my eyes, a consensus at the Guardian. In terms of regular reporters/columnists, Lisa Bachelor seemed to be a fan, Huma Qureshi neutral shading to thinking it a good scheme for some, Miles Brignall not a fan and Patrick Collinson definitely against.

There have been various news stories, Q&A's and opinion pieces, and a number of warnings about the drawbacks of such schemes from their inception until the present

A scheme only good in parts

Home hunter Gareth Rubin discovers some of the drawbacks to shared ownership

The Observer, Sunday 30 October 2005

http://www.guardian.co.uk/money/2005/oct/30/firsttimebuyers.property?INTCMP=SRCH#

Homes that prove a shared burden

First-time buyers can no longer afford part-own, part-rent deals - and those who took them up may face problems, says Karen Dugdale

The Observer, Sunday 30 November 2008

http://www.guardian.co.uk/money/2008/nov/30/firsttime-buyers-shared-ownership

Beware the true cost of a shared-ownership home

Why buy 50% of a property when you could afford 100% in a downturn?

Patrick Collinson

Saturday 31 July 2010

http://www.guardian.co.uk/money/blog/2010/jul/31/beware-cost-shared-ownership?INTCMP=SRCH

Shared ownership schemes: still a stretch to get on the ladderPart-buy, part-rent schemes promise to fulfil the dreams of first-time buyers. But they're not a low-cost option

Ruth Lythe

The Guardian, Saturday 5 March 2011

http://www.guardian.co.uk/money/2011/mar/05/shared-ownership-schemes?INTCMP=SRCH

Oh, and the Guardian let Matt Griffith of PricedOut have the Money Blog on 15 February 2011

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

That is very interesting. Thanks for that. So left wing / public sector publications were also giving warnings about the bubble, and for years.

Also technical or "right wing" publications like the FT and The economist, had many articles warning of the property/credit bubble as well. We had a thread about that here some time ago. (Here: http://www.housepricecrash.co.uk/forum/index.php?showtopic=159795 ). Not to mention Eric's signature ( http://www.housepricecrash.co.uk/forum/index.php?showtopic=159795&view=findpost&p=2900645 )

This reinforces my previous views that the root problem was that the country just didn't want to listen.

(...)

The truth is, the whole country refused to listen, including the government, the monetary authorities (FSA and BoE), the opposition, virtually all the mainstream media (both TV and press, both commercial and the BBC), and also including most of our friends, relatives, acquaintances and colleagues when we tried to explain to them what was happening. We all have many personal experiences about that. Don't we?

The whole country just refused to listen. It was a typical bubble behaviour, collective manic behaviour, on a national scale.

The whole country had plenty of warnings, but people just refused to listen, preferring to believe that money grew on trees houses !

Edited by Tired of Waiting

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This reinforces my previous views that the root problem was that the country just didn't want to listen.

..when I returned to this country in '03 after a ten year overseas stint...it appeared everyone was into investing in houses backed by massive debt....and there was lots of the stuff being splashed on cars , overseas holidays and general high living....

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..when I returned to this country in '03 after a ten year overseas stint...it appeared everyone was into investing in houses backed by massive debt....and there was lots of the stuff being splashed on cars , overseas holidays and general high living....

Yes, that too. The bubble was not only on house prices. The whole economy was in a bubble stage. And the whole country was living beyond its means.

The new issue: "falling standards of living"...

Remember how soon after 2007 the usual view regarding house prices was that the price falls would be temporary, and then back up to "normal", meaning 2007 levels? Now the penny is dropping: 2007 was not "normal", and that we are now going back down to normal.

Well, most people are still way behind the curve regarding living standards... :rolleyes:

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Yes, that too. The bubble was not only on house prices. The whole economy was in a bubble stage. And the whole country was living beyond its means.

The new issue: "falling standards of living"...

Remember how soon after 2007 the usual view regarding house prices was that the price falls would be temporary, and then back up to "normal", meaning 2007 levels? Now the penny is dropping: 2007 was not "normal", and that we are now going back down to normal.

Well, most people are still way behind the curve regarding living standards... :rolleyes:

..agreed ...August 2007 was the 'peak' of funny money...these Gordo Bubble expectations of splashing wads of money peaked then....and we should be heading down towards more modest expectations.....and reality.... :rolleyes:

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The scheme just seems plain irresponsible to me. Basically what it is attempting to do is to encourage people who, by definition, cannot afford to buy and who have very little deposit, to buy new build properties that by their nature are likely to depreciate immediately when bought, in a market which is failing and is likely to continue to fall for some time and at a time when job security is at its minimum. What's more, these types of properties, ie 1/2 bedrooms, are likely to suffer the most during the down town.

Surely, this is a guaranteed, dead cert ticket to negative equity. And this is being promoted by the government?. Am I missing something here or is this just irresponsible?. If this type of deal was being offered via a dodgy ad in the back of a newspaper, it would be investigated by some sort of organisation (or Watchdog) in the interest public safety.

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  • 284 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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