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Patient London FTB

Times front page - Housing market slumps

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4 minutes ago, satch said:

Just a few slow sales that's all, nothing to worry about  ..... prices are holding up, move along, move along, nothing to see here  .............. it's cos of Brexit and Donald Trump.

He's had plenty of experience of property crashes.

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1 minute ago, Patient London FTB said:

Cue some pressure on the govt on stamp duty, which would be the likeliest move from Hammond IMO

Needs to protect his own and his mates property portfolios.

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2 minutes ago, Patient London FTB said:

Cue some pressure on the govt on stamp duty, which would be the likeliest move from Hammond IMO

Good, stamp duty is a terrible tax. It's paying the government for the freedom to move house.

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1 minute ago, satch said:

But SDLT generates tax revenue so much better to have some new HtB scheme so the tax can be collected. How about some magic 'existing home owners cash unlocking scheme' to recycle the wealth (and generate tax revenue) via FTB deposits for their kids.

London's at the heart of the slowdown and HTB hasn't been able to boost FTB numbers in the capital. Prices are too much of a stretch. 

What they need to do is remove some of the stamp duty obstacle to moving around on the higher rungs, without diluting the BTL crackdown. 

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London hpi needs to be constrained. If they won't raise rates,then stamp needs to stay high until prices fall. Constraining London hpi will constrain hpi everywhere with 2hrs commute of London.

 

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7 minutes ago, GreenDevil said:

London hpi needs to be constrained. If they won't raise rates,then stamp needs to stay high until prices fall. Constraining London hpi will constrain hpi everywhere with 2hrs commute of London.

 

Stamp duty kills transactions. Transactions are necessary for price discovery. The more liquid the housing market is the faster it will find its true level.

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25 minutes ago, Patient London FTB said:

Cue some pressure on the govt on stamp duty, which would be the likeliest move from Hammond IMO

Quite possibly, but whatever the govt does will take some time and won't make much difference to the immediate psychological impact of a front page headline.

Which is good.

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5 minutes ago, Dorkins said:

Stamp duty kills transactions. Transactions are necessary for price discovery. The more liquid the housing market is the faster it will find its true level.

Agree. The top end of the market is ready to fall but stamp duty is constraining volumes. 

Also, the cost of moving is stopping people climbing the ladder which is keeping FTB prices high. 

A lot of people remortgaging to improve their current houses rather than move. The interesting thing is they're boosting housing supply (yes, by a small amount, but better than nothing) by doing that. 

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26 minutes ago, GreenDevil said:

London hpi needs to be constrained. If they won't raise rates,then stamp needs to stay high until prices fall. Constraining London hpi will constrain hpi everywhere with 2hrs commute of London.

 

If there's no transactions then prices will fall.No need for high IR's or stamp duty

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8 minutes ago, Patient London FTB said:

Agree. The top end of the market is ready to fall but stamp duty is constraining volumes. 

Also, the cost of moving is stopping people climbing the ladder which is keeping FTB prices high. 

A lot of people remortgaging to improve their current houses rather than move. The interesting thing is they're boosting housing supply (yes, by a small amount, but better than nothing) by doing that. 

Top end of the market in Londinium is falling.It's not ready to fall.

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24 minutes ago, Dorkins said:

Stamp duty kills transactions. Transactions are necessary for price discovery. The more liquid the housing market is the faster it will find its true level.

A lot of things kill transactions but you're dead right on them being necessary for price discovery.

Interesting that they predict transactions down 11% nationally,i suspect that will be far worse in the South than the North

Edited by Sancho Panza

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All the following can be true: 

1) HPI is constrained by stamp duty being kept high

2) The government is likely to look at stamp duty to bring the market back to life and optimise tax revenues

3) London falls regardless of stamp duty being lowered

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49 minutes ago, Patient London FTB said:

Also, the cost of moving is stopping people climbing the ladder which is keeping FTB prices high. 

There's no such thing as an "FTB price", there are just individual properties which each have a price. In the past FTBs supposedly entered the market by buying a relatively cheap property (though plenty of people FTB'd 3 bed semis) but there's no law that says that has to happen. I strongly suspect that half a generation of people who bet everything (5x joint 35 year mortgage) on some low quality FTB property will end up stuck there for decades and that other people will FTB into the higher quality "second step" properties that they can't afford.

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1 hour ago, Dorkins said:

Stamp duty kills transactions. Transactions are necessary for price discovery. The more liquid the housing market is the faster it will find its true level.

Disagree. The lack of transactions is due to high prices as per article. Not due to stamp duty (PCL russian oligarch excepted). No activity means prices fall to find a buyer whatever the SDLT.

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