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Si1

What will the govt do to prop up the housing market and maybe builders now?

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As per title.

We either get a deflationary depression (sceppy) or an inflationary one (KB)

What will the govt do to maintain the housing status quo? 

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Help to Buy is limited to first time buyers from April. It would be a minimal announcement to instead maintain Help to Buy for all, for the benefit of hardworking families naturally. 

First Homes was announced a few weeks back but i can't see this making an impact. It's limited and resale restrictions of these will be miss-selling `scandal` of tomorrow. 

Other than that only other thing would be a new Help to Buy ISA or beef up the LISA. The withdrawal restrictions removed from LISA i expect will stay withdrawn post April.  

They seem limited in what help they can offer for new builds as the gov has already helped out quite a lot. 

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Hopefully the Government realise that the public have seen through the htb scheme as being only a benefit to builders and bad for everyone else,and therefore won’t even dare.Especially as the country will be up to its eyeballs in debt

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More QE.

Extend mortgage holidays.

Negative interest rates.

Longer mortgage terms.

Tax relief for mortgage holders.

Extend furlough scheme.

Help to buy extension.

Equity scheme.

Key worker scheme already announced 30% discount.

Slash stamp duty.

Ease planning permission.

Edited by Speed1987

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1 minute ago, Speed1987 said:

Tax relief for mortgage holders.

This would be a game-changer for higher income couples but very expensive and think we're past the time of offering generous tax relief or salary sacrifice. 

2 minutes ago, Speed1987 said:

Extend mortgage holidays, Help to buy extension.

I can see these happening. 

5 minutes ago, Speed1987 said:

Extend furlough scheme.

I suspect they regret bringing this out in the first place. 

3 minutes ago, Speed1987 said:

Longer mortgage terms.

If it goes past retirement age, which looking at the age of some ftb is a possibility, then i can't see this. 

12 minutes ago, Speed1987 said:

Negative interest rates.

I'm not sure how this would help the building / property industry. 

12 minutes ago, Speed1987 said:

Key worker scheme already announced 30% discount.

Will be minor, if any, impact and will take ages to build these new properties. Something is needed in months not years to prevent the house of cards falling. 

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1 hour ago, dougless said:

With a bit of luck they wont be able to afford any more props.

I'd have thought so. To prop further would lead to a stagnant economy with little opportunity. Oh hang on....

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They will do whatever they can, politically.  Finance doesn't come into it. If they want it, they'll do it.  But I believe that interest rates is the equal first most important determinant of HPs.  The other being lending.

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35 minutes ago, sammersmith said:

Negative interest rates.

I'm not sure how this would help the building / property industry. 

Would push up house prices, by reducing mortgage debt. 

"The ECB's decision to push rates below zero in 2014 coincided with a pivotal shift in eurozone house prices, which increased by 16% between 2015 and 2018," Vistesen said in a research note recently. "The increase in eurozone household net worth is now exclusively driven by rising house prices."

https://www.google.com/amp/s/www.businessinsider.com/negative-interest-rates-europe-property-prices-2019-5%3famp

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1 hour ago, sammersmith said:

Help to Buy is limited to first time buyers from April. It would be a minimal announcement to instead maintain Help to Buy for all, for the benefit of hardworking families naturally. 

First Homes was announced a few weeks back but i can't see this making an impact. It's limited and resale restrictions of these will be miss-selling `scandal` of tomorrow. 

Other than that only other thing would be a new Help to Buy ISA or beef up the LISA. The withdrawal restrictions removed from LISA i expect will stay withdrawn post April.  

They seem limited in what help they can offer for new builds as the gov has already helped out quite a lot. 

Also the regional house price caps will be key - the £600k figure remains in London from April but its reduced to £186k in the north east and £437k in the south east which won't go far in say Surrey or Berkshire.

https://www.helptobuy.gov.uk/equity-loan/eligibility/

So allow non FTBs to still use the scheme and keep the £600k cap everywhere as now?

Edited by MARTINX9

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1 hour ago, Speed1987 said:

Would push up house prices, by reducing mortgage debt. 

"The ECB's decision to push rates below zero in 2014 coincided with a pivotal shift in eurozone house prices, which increased by 16% between 2015 and 2018," Vistesen said in a research note recently. "The increase in eurozone household net worth is now exclusively driven by rising house prices."

https://www.google.com/amp/s/www.businessinsider.com/negative-interest-rates-europe-property-prices-2019-5%3famp

Dude, you're missing the point of just how deflationary this could get. Sceppy makes the point that in his deflationary scenario, even mildly negative interest rates (at the lower practical bound of just under zero) then real rates are still significantly positive. Unlike the EU scenario you're comparing.

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2 hours ago, poohbear said:

Hopefully the Government realise that the public have seen through the htb scheme as being only a benefit to builders and bad for everyone else,and therefore won’t even dare.Especially as the country will be up to its eyeballs in debt

No offence but I'm guessing you're new to this? The general public just isn't that smart and far too many (most?) have a 'live for the moment' mentality.

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5 hours ago, Speed1987 said:

Tax relief for mortgage holders

This was actually a thing in the 90s - Gordon Brown got rid of it. MIRAS it was called. 

 

 

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5 hours ago, lombardo said:

There is always helicopter money.

This is happening right now. An acquaintance of mine reports being overpaid the bounce back loan and when he queried it was told the bank didn't want the money back. 

Doubtful whether they'll ever actively enforce collections on these loans. What's he spending the excess on? You guessed it; property. 

Meanwhile there are people out there who literally can't afford to eat. Helicopter money is happening alright; it's being helicoptered into exactly the places intended. 

I really would not bank on an hpc any time soon. 

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10 minutes ago, Hullabaloo82 said:

This is happening right now. An acquaintance of mine reports being overpaid the bounce back loan and when he queried it was told the bank didn't want the money back. 

Doubtful whether they'll ever actively enforce collections on these loans. What's he spending the excess on? You guessed it; property. 

Meanwhile there are people out there who literally can't afford to eat. Helicopter money is happening alright; it's being helicoptered into exactly the places intended. 

I really would not bank on an hpc any time soon. 

Doesn't it need paying back one day?

(Possibly silly question)

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1 minute ago, Si1 said:

Doesn't it need paying back one day?

(Possibly silly question)

In theory yes; in practice, it's 100% government backed. Where's the incentive for the bank to chase the money down when the government are handing it out like ghb at an Epstein party? 

Lots of spiv business advisors out there telling people they don't need to pay it back. Don't doubt for a second thousands won't. 

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Just now, Hullabaloo82 said:

In theory yes; in practice, it's 100% government backed. Where's the incentive for the bank to chase the money down when the government are handing it out like ghb at an Epstein party? 

Lots of spiv business advisors out there telling people they don't need to pay it back. Don't doubt for a second thousands won't. 

Oh

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It's just liar loans all over again and, once again, when the time comes and the government effectively writes off this debt you can guarantee we'll all be in it together (translation; nurses, doctors, supermarket people and other assorted PAYE mugs will pay it back through increased income tax whilst the recipients continue to contribute ****** all). 

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8 hours ago, LandOfConfusion said:

No offence but I'm guessing you're new to this? The general public just isn't that smart and far too many (most?) have a 'live for the moment' mentality.

Sadly not.Been a home owner since 1983 and understand only too well how house prices have screwed up so many aspects of life.But I live in hope that more and more will see high house prices as a negative thing.

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They've already done it in the form of:

 

-The Furlough scheme

-Mortgage holidays

-PCP/Lease payment holidays

-Business hardship grants

-Bounce back ''loans'' aka grants as they mostly won't be paid back

 

When they say all these measures are to ''help protect the economy'' don't forget the property market IS the economy in the UK.

Edited by nome

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23 minutes ago, stuckinlimbo said:

Bank of England hinted a few days ago at an option of banks taking part of the equity in your Home, a bit like how the government takes equity when you use HTB

https://bankunderground.co.uk/2020/05/20/housing-consumption-and-investment-evidence-from-the-help-to-buy-scheme/#more-6222

I'd rather private banks took the equity than govt (providing they're not backstopped by by govt for doing so) as then it's their market risk and subject to actual market constraints, I'd think, instead of fantasy govt-backed valuations.

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  • 395 Brexit, House prices and Summer 2020

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