BLOW FLY Posted October 29, 2015 Report Share Posted October 29, 2015 Something I've been pondering for a while and have come to a variety of thoughts and conclusions but I thought I'd pose the question here to see what everyone else's thoughts might be. So hypothetically say things continue as they are and successive governments, BoE and financial institutions etc manage to keep the plates spinning and house prices rising steadily for the next 30 years? What will happen to all those people that have been priced out of the housing market but been paying large percentage of their income all their life to some BTLr or housing institution? They now retire, have no savings, maybe no pension or house equity to show of because it's all been swallowed in rent and living expenses. That's one huge benefits bill that's going to have to be paid out, if of course there is still a welfare state. I just can't really see any solution to this. BF Quote Link to post Share on other sites
Monkey Posted October 29, 2015 Report Share Posted October 29, 2015 I have too. Work place pension scheme is one tool i think they hope will reduce state dependancy in 30-40 years time. They are rampently pushing home ownership with all the props, and i think they will only remove them when sentiment of the general public changes to being against home ownership. Quote Link to post Share on other sites
Killer Bunny Posted October 29, 2015 Report Share Posted October 29, 2015 They'll come to their senses and stop campaigning for more builds and instead for #banHTB Quote Link to post Share on other sites
PopGun Posted October 29, 2015 Report Share Posted October 29, 2015 I have too. Work place pension scheme is one tool i think they hope will reduce state dependancy in 30-40 years time. Pi55ing in the wind though isn't it, unless you can afford to stash >30% of your monthly take home income... Another consequence of high living/housing low wage economy. Wealth creators again leaving the state to foot the short falls. Quote Link to post Share on other sites
bendy Posted October 29, 2015 Report Share Posted October 29, 2015 Logans run probably. I think I've posted (a few) threads on the subject eons back, no-one really knows. There are small pockets of sentiment change (but no regime change) in some people now who have their kids at home that are thirties or forties that can see what damage it's causing (esp. if expecting grandkids). An interesting angle for me (related to the children part) is how to continue to enforce this on the population, if you price out those that are there to protect the sytem (army, police etc.) then there will be a problem. Tip - go long on drone companies! Quote Link to post Share on other sites
Money Frugality Posted October 29, 2015 Report Share Posted October 29, 2015 Pi55ing in the wind though isn't it, unless you can afford to stash >30% of your monthly take home income... State pension is a huge welfare expense though and is only growing hence the rising retirement ages. What's stopping the state making a workplace pension mandatory & scrapping or severely reducing the state pension? Quote Link to post Share on other sites
Motor_Blade Posted October 29, 2015 Report Share Posted October 29, 2015 Assuming that the current generation of renters remain renters for life, the quick upshot is that housing benefit becomes unaffordable - how that becomes rationed will be very interesting indeed. Realistically a lot of people may find themselves working until they drop out of necessity. However things play out its hard to avoid the conclusion that many will have much lower standards of living than previous generations. I fear for how my grandchildren will get on in the future as life will get harder for them. Quote Link to post Share on other sites
Motor_Blade Posted October 29, 2015 Report Share Posted October 29, 2015 State pension is a huge welfare expense though and is only growing hence the rising retirement ages. What's stopping the state making a workplace pension mandatory & scrapping or severely reducing the state pension? Realistically nothing and we're already moving in that direction - the problem is that if people have to pay rents out of their pensions, their rents are going to be unaffordable in most cases. As things stand the average pension pot on retirement is all of £38,000 (according to the Guardian if memory serves) - that isn't going to pay much rent in retirement (or anything else for that matter). While that figure may well not be 100% accurate - it does show that most people are saving nowhere near enough for retirement. Quote Link to post Share on other sites
irrationalactor Posted October 29, 2015 Report Share Posted October 29, 2015 Living standards are already much lower than previous generations. I'm 32 and I live like a student. Had I been born twenty years earlier I would have had my own place by now. The current generation of near-pensioners didn't save enough - why else is their property their pension? And renters like me have spent their whole working lives building up someone else's 'pension pot' of equity, left with very little to save for ourselves. Either the government will keep borrowing to pay for everything, or there'll be a generation that just can't afford to get old. Quote Link to post Share on other sites
davidg Posted October 29, 2015 Report Share Posted October 29, 2015 i. The boomers will be dead and their assets will be cheap and plentiful or ii. The country has imported 50 million refugees and the native population will be repressed and begging on the streets, if they are lucky Something I've been pondering for a while and have come to a variety of thoughts and conclusions but I thought I'd pose the question here to see what everyone else's thoughts might be. Quote Link to post Share on other sites
R K Posted October 29, 2015 Report Share Posted October 29, 2015 Same as what happens in most other places. Rent forever, live hand to mouth, die. Quote Link to post Share on other sites
winkie Posted October 29, 2015 Report Share Posted October 29, 2015 They will do what third world countries do and have more kids to ensure their future security? Quote Link to post Share on other sites
Motor_Blade Posted October 29, 2015 Report Share Posted October 29, 2015 The current generation of near-pensioners didn't save enough - why else is their property their pension? Property is their pension because they can borrow the money to get it, try going to the bank to get a loan to pay into a pension scheme & see what happens....... Quote Link to post Share on other sites
Simon Taylor Posted October 29, 2015 Report Share Posted October 29, 2015 This cohort will become electorally more significant as they grow older, stop dicking about on social media and actually vote. At that point, the political will to build more houses and face down the VIs and niimbyism will prevail. We are already seeing housing becoming more political. Osborne, if nothing else, is a politically astute chancellor and his changes to BTL taxation will probably be seen as the point at which the politics around housing really changed. Quote Link to post Share on other sites
Killer Bunny Posted October 29, 2015 Report Share Posted October 29, 2015 Logans run probably. More like Soylent Green Quote Link to post Share on other sites
hans kammler Posted October 29, 2015 Report Share Posted October 29, 2015 state retirement homes offshored to Somalia or some other 3rd world shithole. Quote Link to post Share on other sites
PopGun Posted October 29, 2015 Report Share Posted October 29, 2015 State pension is a huge welfare expense though and is only growing hence the rising retirement ages. Yes but don't forget the demographic pyramid will be flipped on its head in 20 odd years. What's stopping the state making a workplace pension mandatory & scrapping or severely reducing the state pension? It would be a very nasty thing to do. Unless they forced you to save at least a third of your monthly income you wouldn't save anywhere near enough, yet because of paying this token amount, people will have even more of a false sense of retirement security. It's alright I'm saving a £100 a month towards my retirement, I'll be dandy. Instead of the expected comfortable retirement, they'll be lucky to fund the bus fare to the food bank/IDS Stasi interrogation centre. All this propaganda to rid the state pension/raise retirement ages is a misleading ruse. Quote Link to post Share on other sites
porca misèria Posted October 29, 2015 Report Share Posted October 29, 2015 Back to the future? Some of us are even now growing old ... Quote Link to post Share on other sites
crashmonitor Posted October 29, 2015 Report Share Posted October 29, 2015 (edited) i. The boomers will be dead and their assets will be cheap and plentiful or ii. The country has imported 50 million refugees and the native population will be repressed and begging on the streets, if they are lucky The boomers will be dead and their kids will inherit the property and family portfolios will get larger Victorian style. Generous inheritance tax thresholds spells anarchy. I guess Tony Blair changed the world, family property portfolio, tick. Useless degrees to indulge kid's rite of passage, tick. Entire economic policy based on house price growth, tick. Edited October 29, 2015 by crashmonitor Quote Link to post Share on other sites
CunningPlan Posted October 29, 2015 Report Share Posted October 29, 2015 Yes - the music has stopped. If you owned a house when it did well done for you and your future generations. If not, welcome to serfdom. I find it frightening to see a forecast that by 2020, 33% of all houses will be rentals. Effectively, 66% of the population will be working their guts out to keep 33% in idle riches. How has that ended in history? Quote Link to post Share on other sites
PopGun Posted October 29, 2015 Report Share Posted October 29, 2015 state retirement homes offshored to Somalia or some other 3rd world shithole. You may laugh, but.... Quote Link to post Share on other sites
StainlessSteelCat Posted October 29, 2015 Report Share Posted October 29, 2015 (edited) Without a crash, we will become a two tier society. The priced out with parents who have property will perhaps inherit it in their 60s/70s or get BoMaD loans. Those without will likely never own. It'll come to be regarded as normal. For the next generation, I suspect the first group will outnumber the second. I think there'll be a crash long before then. And outside of the SE and a few other areas, prices are at best stagnant anyhow. Edited October 29, 2015 by StainlessSteelCat Quote Link to post Share on other sites
bankstersparadise Posted October 29, 2015 Report Share Posted October 29, 2015 They'll have to start taxing property wealth sooner or later. All that unearned wealth will have to pay for the housing benefit of the priced out generation. Perhaps a yearly properly tax like they have in America or perhaps CGT on main homes. Sooner or later something will have to be brought in as the housing benefit bill (let alone the other benefits) is going to be astronomical. CGT on primary residence is the WORST policy (well now the IHT threshold has already been increased that is!)....anyone who could, never would, realise those gains. You need to get the tax code to make the market more liquid not less. Quote Link to post Share on other sites
irrationalactor Posted October 29, 2015 Report Share Posted October 29, 2015 So by the time I finally manage to buy a house they'll start taxing them? How did we get from the 90s to here? In just twenty years all the opportunity and hope has died. Maybe I am 'old' already... Quote Link to post Share on other sites
crashmonitor Posted October 29, 2015 Report Share Posted October 29, 2015 How did we get from the 90s to here? http://www.toonpool.com/user/3806/files/tony_blair_442095.jpg Quote Link to post Share on other sites
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