highcontrast Posted September 9, 2020 Share Posted September 9, 2020 "Britain’s housing market has become “too big to fail” because of the government’s exposure through Help to Buy, an industry veteran has claimed. Greg Fitzgerald, chief executive of Vistry, the housebuilder formerly known as Bovis Homes, said the next housing market downturn would differ from previous crashes because the government would have to explain the loss on its investment to voters. https://www.thetimes.co.uk/article/help-to-buy-makes-market-too-big-to-fail-0pslfs7mx Quote Link to comment Share on other sites More sharing options...
longgone Posted September 9, 2020 Share Posted September 9, 2020 explain the loss on its investment to voters. 😂 Quote Link to comment Share on other sites More sharing options...
spacedin Posted September 9, 2020 Share Posted September 9, 2020 Too big to fail? Maybe it's time for Help to Fail.. Quote Link to comment Share on other sites More sharing options...
Orb Posted September 9, 2020 Share Posted September 9, 2020 8 minutes ago, spacedin said: Too big to fail? Maybe it's time for Help to Fail.. 🤣 Or help to shared failure. Quote Link to comment Share on other sites More sharing options...
PaulTW Posted September 9, 2020 Share Posted September 9, 2020 Government has pumped about £16bn in to HTB, not sure it would class as an investment as they just act as the deposit and that is owed back on sale. Then again, I'm not sure what you'd call it other than a HPI prop! Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2020 Share Posted September 9, 2020 Panicking vi shocker Quote Link to comment Share on other sites More sharing options...
hayder Posted September 9, 2020 Share Posted September 9, 2020 even if the properties halved and every single HTB sold up with a loss it would mean about £8Bn loss for HM Gov. Not nearly big enough to be a moral hazard. Quote Link to comment Share on other sites More sharing options...
Roman Roady Posted September 9, 2020 Share Posted September 9, 2020 So is it really a choice between the housing market and the currency, wider economy and well being of the UK population? The UK housing stock is NOT worth the current valuation in terms of the rest of the world...something has to give. Quote Link to comment Share on other sites More sharing options...
This time Posted September 9, 2020 Share Posted September 9, 2020 14 minutes ago, hayder said: even if the properties halved and every single HTB sold up with a loss it would mean about £8Bn loss for HM Gov. Not nearly big enough to be a moral hazard. The government would lose the lot. I believe how it works is that if prices drop then first the borrower loses their deposit, then the government loses theirs and then the borrower owes the bank the difference between the sale price and the mortgage. Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2020 Share Posted September 9, 2020 3 minutes ago, This time said: The government would lose the lot. I believe how it works is that if prices drop then first the borrower loses their deposit, then the government loses theirs and then the borrower owes the bank the difference between the sale price and the mortgage. Yes I think this is right. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted September 9, 2020 Share Posted September 9, 2020 Quote Link to comment Share on other sites More sharing options...
msi Posted September 9, 2020 Share Posted September 9, 2020 Where are our HPI trolls? Come on, waiting for your comedy gold! Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2020 Share Posted September 9, 2020 I do find the fact the govt is essentially bailing out the buying errors of the middle classes to be utterly shocking. This is as bad as Gordo selling off the gold. Quote Link to comment Share on other sites More sharing options...
PaulTW Posted September 9, 2020 Share Posted September 9, 2020 3 minutes ago, Si1 said: I do find the fact the govt is essentially bailing out the buying errors of the middle classes to be utterly shocking. A Tory government at that, usually the fiscal hawks of the bunch. 10 minutes ago, This time said: The government would lose the lot. I believe how it works is that if prices drop then first the borrower loses their deposit, then the government loses theirs and then the borrower owes the bank the difference between the sale price and the mortgage. Thanks for this, I know the figures regarding amount of public money behind HTB but not necessarily the workings when it comes to prices. Could get very ugly indeed. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted September 9, 2020 Share Posted September 9, 2020 1 hour ago, highcontrast said: "Britain’s housing market has become “too big to fail” because of the government’s exposure through Help to Buy, an industry veteran has claimed. Greg Fitzgerald, chief executive of Vistry, the housebuilder formerly known as Bovis Homes, said the next housing market downturn would differ from previous crashes because the government would have to explain the loss on its investment to voters. https://www.thetimes.co.uk/article/help-to-buy-makes-market-too-big-to-fail-0pslfs7mx these **** should be jailed for the rest of their lives. Quote Link to comment Share on other sites More sharing options...
Locke Posted September 9, 2020 Share Posted September 9, 2020 7 minutes ago, TheCountOfNowhere said: these **** should be jailed for the rest of their lives. That's expensive, rope is reusable. Quote Link to comment Share on other sites More sharing options...
nothernsoul Posted September 9, 2020 Share Posted September 9, 2020 I agree the government views housing market as too big to fail but HTB isnt really a part of their thinking. Governments have wasted billions on plenty of things, failed IT systems come to mind, and while a political embarrassment they know they can get over it. Balancing budgets and throwing around money means little now. Billions of pounds is an abstract concept to the public and means little. What the government know they cannot get over is a crash that will dramatically lower the value of millions of voters homes. Quote Link to comment Share on other sites More sharing options...
PaulTW Posted September 9, 2020 Share Posted September 9, 2020 9 minutes ago, nothernsoul said: crash that will dramatically lower the value of millions of voters homes. The same voters who embrace all things capitalism but won't accept the idea of a free market when it comes to housing! Quote Link to comment Share on other sites More sharing options...
ForGreatLager... Posted September 9, 2020 Share Posted September 9, 2020 2 minutes ago, nothernsoul said: What the government know they cannot get over is a crash that will dramatically lower the value of millions of voters homes. Exactly. A housing market crash is the death knell for a political party. But at what point will the majority want prices to come down? When today’s kids are unable to fly the nest? We’ve been saying for nearly two decades on here that it’s unsustainable, and yet they keep on finding ways to pump it up. The control of prices needs to be taken out of their hands. If a global pandemic and Brexit don’t make prices drop, nothing will. Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2020 Share Posted September 9, 2020 26 minutes ago, ForGreatLager... said: Exactly. A housing market crash is the death knell for a political party. But at what point will the majority want prices to come down? When today’s kids are unable to fly the nest? We’ve been saying for nearly two decades on here that it’s unsustainable, and yet they keep on finding ways to pump it up. The control of prices needs to be taken out of their hands. If a global pandemic and Brexit don’t make prices drop, nothing will. https://www.marketwatch.com/story/the-world-is-on-the-cusp-of-a-new-era-says-deutsche-strategist-and-heres-what-it-means-for-markets-11599589831 Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2020 Share Posted September 9, 2020 https://dictionary.cambridge.org/dictionary/english/throw-good-money-after-bad https://www.behavioraleconomics.com/resources/mini-encyclopedia-of-be/sunk-cost-fallacy/ Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted September 9, 2020 Share Posted September 9, 2020 50 minutes ago, ForGreatLager... said: Exactly. A housing market crash is the death knell for a political party. John major won in 1992. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted September 9, 2020 Share Posted September 9, 2020 17 minutes ago, Si1 said: https://www.behavioraleconomics.com/resources/mini-encyclopedia-of-be/sunk-cost-fallacy/ Is there a sunak cost fallacy ? Quote Link to comment Share on other sites More sharing options...
msi Posted September 9, 2020 Share Posted September 9, 2020 24 minutes ago, TheCountOfNowhere said: Is there a sunak cost fallacy ? 😀 You win post of the week Quote Link to comment Share on other sites More sharing options...
worried1 Posted September 9, 2020 Share Posted September 9, 2020 2 hours ago, TheCountOfNowhere said: these **** should be jailed for the rest of their lives. They don't seem to know any limits, do they? They've been accepting these handouts for years, have been consistently lobbying for further support and now turn to this! The problem is that the public support it. As soon as there is a new tower block of flats proposed in my area (which has now moved beyond the HTB limit), anyone who opposes it is dressed down with the argument - 'we need more housing you know, so this a good thing'. They don't seem to realise that building £1m flats isn't really helping anyone but the developers and the councils hit their 'targets'. Quote Link to comment Share on other sites More sharing options...
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