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Guardian: Britain's buy-to-let boom is over – we should rejoice


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https://www.theguardian.com/money/2020/feb/08/britains-buy-to-let-boom-is-over-we-should-rejoice#comments

Pretty generic article - however the comments are interesting:

  • Guardian readers showing their true colours and exposing themselves as landlords and complaining about being taxed on interest.
  • This is the true face of the people propping up neo-liberalism - the guardian is not a socialist paper.
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1 hour ago, APerson said:

https://www.theguardian.com/money/2020/feb/08/britains-buy-to-let-boom-is-over-we-should-rejoice#comments

Pretty generic article - however the comments are interesting:

  • Guardian readers showing their true colours and exposing themselves as landlords and complaining about being taxed on interest.
  • This is the true face of the people propping up neo-liberalism - the guardian is not a socialist paper.

True face of middle aged british lefties - capitslism is bad; theres plenty of room for 4 people in my 2 bedroom btl.

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What the buy-to-let episode shows is that policy matters. The explosion in buy-to-let was not a “natural” phenomenon – it was a product of legal changes in the 1990s (the assured shorthold tenancy) married to a tax regime that favoured landlords. The result was entirely predictable; home ownership began to fall, not just among the young but increasingly among middle-aged people as well. Property wealth shifted into fewer and fewer hands.

Balls.

Io btl started around 2001.

The tax system did not favour lls. Io btl was so insane a concept no regulation existed.

IOBtl was down to Brown ignoring stupidly expanding balance sheets as he blew the biggest credit bubble the uk has ever seen. Before it blew up, creating the uks first widescale bank crisis

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1 hour ago, spyguy said:

What the buy-to-let episode shows is that policy matters. The explosion in buy-to-let was not a “natural” phenomenon – it was a product of legal changes in the 1990s (the assured shorthold tenancy) married to a tax regime that favoured landlords. The result was entirely predictable; home ownership began to fall, not just among the young but increasingly among middle-aged people as well. Property wealth shifted into fewer and fewer hands.

Balls.

Io btl started around 2001.

The tax system did not favour lls. Io btl was so insane a concept no regulation existed.

IOBtl was down to Brown ignoring stupidly expanding balance sheets as he blew the biggest credit bubble the uk has ever seen. Before it blew up, creating the uks first widescale bank crisis

The home ownership has been going down among 25-44 since 90s. 

Since 1961 home ownership rates have decreased for successive  age groups below the age of 65, particularly those aged 25 to 34

 

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6 hours ago, slawek said:

The home ownership has been going down among 25-44 since 90s. 

Since 1961 home ownership rates have decreased for successive  age groups below the age of 65, particularly those aged 25 to 34

 

Theres a levelling off/slight dip from 91->01. That might be explained b ythe deep 90s recession where peoples work-buy house cycle was disrupted.

The noticable fall starts in 2001.

 

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Not got a problem with those that buy to rent without borrowing/debt/mortgage........the worst injustice was Interest only with tax relief for landlords and repayment only with no tax relief for owner occupiers.....this is a typical example of why and how inequality has grown, and how certain people have a cheap financial highly leveraged advantage over others, they didn't even have to show proof of having any income ....how can ordinary working people compete .?

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34 minutes ago, winkie said:

hey didn't even have to show proof of having any income ....how can ordinary working people compete

Really ? Try applying for IO BTL mortgage with a bank.

If they lend without asking any proof of income from you, that would be surprising.

I had to submit lots of documentation and declarations and queries on "from where did this money came ?" , "proof that money came from you or family members, not from outside".

It was 2 months process to get an IO mortgage.

BUT the real bad thing is, they don't want the customer to pay off capital, they put strict restrictions on overpayments.

they should instead encourage customers to pay off the mortgage instead of keeping it alive for many years.

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9 minutes ago, Simhadri said:

Really ? Try applying for IO BTL mortgage with a bank.

If they lend without asking any proof of income from you, that would be surprising.

I had to submit lots of documentation and declarations and queries on "from where did this money came ?" , "proof that money came from you or family members, not from outside".

It was 2 months process to get an IO mortgage.

BUT the real bad thing is, they don't want the customer to pay off capital, they put strict restrictions on overpayments.

they should instead encourage customers to pay off the mortgage instead of keeping it alive for many years.

I can assure you that in the past BTL borrowers did not have to prove income, the income was based on the rental income........?

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2 hours ago, spyguy said:

Theres a levelling off/slight dip from 91->01. That might be explained b ythe deep 90s recession where peoples work-buy house cycle was disrupted.

The noticable fall starts in 2001.

 

I don't think that is because of the 91-92 recession. The economy was doing well the rest of 90s. I think it was due to the introduction of AST which significantly changed the balance of power between landlords and tenants.  

I agree that the leverage BTL is a big factor but changes to law are too. 

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2 hours ago, spyguy said:

Theres a levelling off/slight dip from 91->01. That might be explained b ythe deep 90s recession where peoples work-buy house cycle was disrupted.

The noticable fall starts in 2001.

 

Very likely, but also compounded by a demographic trough of 20 somethings around that time too.    

By the same argument we should see an upward trend as the post '85 boom should kick in after 2010 ish but this isnt seen suggesting the position of 20/30 somethings is worse than the graph indicates.

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8 minutes ago, nightowl said:

Very likely, but also compounded by a demographic trough of 20 somethings around that time too.    

By the same argument we should see an upward trend as the post '85 boom should kick in after 2010 ish but this isnt seen suggesting the position of 20/30 somethings is worse than the graph indicates.

It is not demographics. Both group 25-34 and 35-44 show the same pattern. There is no lag. 

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10 hours ago, slawek said:

The home ownership has been going down among 25-44 since 90s. 

Since 1961 home ownership rates have decreased for successive  age groups below the age of 65, particularly those aged 25 to 34

 

The UK is facing a demographic crisis with its low birth rate and fast-ageing population.

Coronavirus outbreak could be game changer, but it's still too early to say.

In today news:

Quote

 

The Department of Health has described the coronavirus as a "serious and imminent threat" to public health. The overall risk level to the UK remains "moderate".

BBC

 

 

 

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7 minutes ago, rollover said:

The UK is facing a demographic crisis with its low birth rate and fast-ageing population.

It's facing the ability to escape the devastation wrought by crazy population growth, it's only portrayed as a crisis by those unwilling to look at the long term and unwilling to make the effort to deal with the sort-term effects.

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2 hours ago, Riedquat said:

It's facing the ability to escape the devastation wrought by crazy population growth, it's only portrayed as a crisis by those unwilling to look at the long term and unwilling to make the effort to deal with the sort-term effects.

When more young people in real terms are earning less than they did 30 years ago......kids live with parents for longer, some might not own anything until their parents death........actually multi generational families living together can pool resources, for example six incomes going into one home, no rent to pay......the only way to accumulate anything these days.;)

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https://www.theguardian.com/money/2020/feb/10/home-ownership-ons-rent

"In a reflection of surging house prices and a lost decade for wage growth since the financial crisis, the Office for National Statistics found that a third of 35- to 44-year-olds in England were renting from a private landlord in 2017, compared with fewer than one in 10 in 1997.

The government statistics agency said home ownership had become increasingly concentrated among people over the age of 65. Almost three-quarters of adults in the generation that includes baby boomers born after the second world war own their own homes outright, up from just over half in 1993"

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4 hours ago, Quicken said:

https://www.theguardian.com/money/2020/feb/10/home-ownership-ons-rent

"In a reflection of surging house prices and a lost decade for wage growth since the financial crisis, the Office for National Statistics found that a third of 35- to 44-year-olds in England were renting from a private landlord in 2017, compared with fewer than one in 10 in 1997.

The government statistics agency said home ownership had become increasingly concentrated among people over the age of 65. Almost three-quarters of adults in the generation that includes baby boomers born after the second world war own their own homes outright, up from just over half in 1993"

Deeply ubstable deomgraphics.

In 10 years tine, 40% of todays 65yo will be dead.

In 20 years time, 80% will be dead.

 

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5 hours ago, Quicken said:

https://www.theguardian.com/money/2020/feb/10/home-ownership-ons-rent

"In a reflection of surging house prices and a lost decade for wage growth since the financial crisis, the Office for National Statistics found that a third of 35- to 44-year-olds in England were renting from a private landlord in 2017, compared with fewer than one in 10 in 1997.

The government statistics agency said home ownership had become increasingly concentrated among people over the age of 65. Almost three-quarters of adults in the generation that includes baby boomers born after the second world war own their own homes outright, up from just over half in 1993"

Wealth concentration is even worse

image.png.9ae60bd4e63f2678e2dd9071a0c5e5b4.png

https://cy.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/ageing/articles/livinglongerhowourpopulationischangingandwhyitmatters/2018-08-13

 

Edited by slawek
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On 09/02/2020 at 23:33, spyguy said:

What the buy-to-let episode shows is that policy matters. The explosion in buy-to-let was not a “natural” phenomenon – it was a product of legal changes in the 1990s (the assured shorthold tenancy) married to a tax regime that favoured landlords. The result was entirely predictable; home ownership began to fall, not just among the young but increasingly among middle-aged people as well. Property wealth shifted into fewer and fewer hands.

Balls.

Io btl started around 2001.

The tax system did not favour lls. Io btl was so insane a concept no regulation existed.

IOBtl was down to Brown ignoring stupidly expanding balance sheets as he blew the biggest credit bubble the uk has ever seen. Before it blew up, creating the uks first widescale bank crisis

 

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17 hours ago, Riedquat said:

It's facing the ability to escape the devastation wrought by crazy population growth, it's only portrayed as a crisis by those unwilling to look at the long term and unwilling to make the effort to deal with the sort-term effects.

Yes. Britain would be much better off with half the population and much more automation.

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6 hours ago, MarkG said:

Yes. Britain would be much better off with half the population and much more automation.

Agree with the first half but we've no need of the level of automation we've got, let alone more, other than due to the fact that we're caught in the vicious circle arms race with other countries racing to the bottom.

Edited by Riedquat
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8 hours ago, MarkG said:

Yes. Britain would be much better off with half the population and much more automation.

Machines don't pay rent or bid up the price of housing...TPTB in the UK hold their wealth in land and property and policy reflects their needs.

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  • 415 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% +
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      • Even
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      • up 5%



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