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darrude

Just Suppose!

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I was having a discussion at work about house prices (everyone at work is a BTL landlord).

What would happen if house prices kept going up. Would we live in a world where either your parents buy you a house by releaseing equity, or you are poor, not matter you skills or abilities.

This was the general consensous we came up, the implecations of this are horrendus, rising crime, homelessness while those lucky enough to be brough up on a silver spoon drive porsche boxters at 17 years old.

Does any government look at the long term implecations or do they also have the buy now, think later attuide.

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Yeah yeah.

Start a 'what if we're all wrong' thread like you're a desperate bear.

I say -

Troll!

Just to muddy the waters a bit eh? Just to make new FTBs reading this say "nobody's sure what will happen even on HPC! I'd better go and buy then'

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Given that the UK population is apparently going to fall by 30% over the next 2 generations, I'm not sure who all the BTLers are planning on either letting to, or selling to to fund their retirement.

My 18 yr old is just about to go to Uni, will most likely be indebted to the tune of £20k when he finishes, and I can't see him wanting to buy a house for at least 10 years, if ever. My advice to him would be to rent for as long as possible. In contrast, I had a 3 bed-semi at 22, having saved a 30% deposit in 3 years. I really don't think people have thought through this IO BTL for a pension thing at all.

In fact you can almost guarantee if everyone at work has got one then it is probably a very bad idea. Did they all buy dot.com stocks in 1999 as well? and a personal pension? and a betamax? Might be interesting to ask.......

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I was having a discussion at work about house prices (everyone at work is a BTL landlord).

What would happen if house prices kept going up. Would we live in a world where either your parents buy you a house by releaseing equity, or you are poor, not matter you skills or abilities.

This was the general consensous we came up, the implecations of this are horrendus, rising crime, homelessness while those lucky enough to be brough up on a silver spoon drive porsche boxters at 17 years old.

Does any government look at the long term implecations or do they also have the buy now, think later attuide.

This is a very interesting thought isn't it ?

I guess trying to think it through 'logicically'.............................................

eventually all the people that own the houses would die, then prices would have to down as the people left living could not afford to buy them, guess we have yet to see this happen as MOST of the people who own the houses that have gone up astronomically over the past 5 - 10 years are still alive, so this has not happened yet.

Is that too simplistic GAL BEAR logic ? :blink:

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Guest DissipatedYouthIsValuable
This is a very interesting thought isn't it ?

I guess trying to think it through 'logicically'.............................................

eventually all the people that own the houses would die, then prices would have to down as the people left living could not afford to buy them, guess we have yet to see this happen as MOST of the people who own the houses that have gone up astronomically over the past 5 - 10 years are still alive, so this has not happened yet.

Is that too simplistic GAL BEAR logic ? :blink:

No, you're on the money.

*Pats bottom*

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Given that the UK population is apparently going to fall by 30% over the next 2 generations

Who said?

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This is a very interesting thought isn't it ?

I guess trying to think it through 'logicically'.............................................

eventually all the people that own the houses would die, then prices would have to down as the people left living could not afford to buy them, guess we have yet to see this happen as MOST of the people who own the houses that have gone up astronomically over the past 5 - 10 years are still alive, so this has not happened yet.

Is that too simplistic GAL BEAR logic ? :blink:

In the simplistic world of the question, the simplistic answer seems about right. I would add a bit more too it though: as people died and left houses to their heirs, the amount of money in housing would drop somewhat due to inheritance tax, prices would then build up again due to the ongoing lack of supply, eventually some sort of equilibrium would be reached. Of course, markets abhore an equilibrium, so that will never happen.

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This is a very interesting thought isn't it ?

I guess trying to think it through 'logicically'.............................................

eventually all the people that own the houses would die, then prices would have to down as the people left living could not afford to buy them, guess we have yet to see this happen as MOST of the people who own the houses that have gone up astronomically over the past 5 - 10 years are still alive, so this has not happened yet.

Is that too simplistic GAL BEAR logic ? :blink:

STOP FEEDING THE TROLL!!!

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Guest DissipatedYouthIsValuable
So nothing to back it up then?

I have a small part of the evidence on paper.

Well, more in a tissue to be exact.

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I was having a discussion at work about house prices (everyone at work is a BTL landlord).

What would happen if house prices kept going up. Would we live in a world where either your parents buy you a house by releaseing equity, or you are poor, not matter you skills or abilities.

This was the general consensous we came up, the implecations of this are horrendus, rising crime, homelessness while those lucky enough to be brough up on a silver spoon drive porsche boxters at 17 years old.

Does any government look at the long term implecations or do they also have the buy now, think later attuide.

no, all the skilled people would move to a cheaper country, or people will strike like whats happening now, if wages do rise prices will rise effecting everyone, you can only keep cpi low for so long. Then you'll have an increase in crime. high house prices are no good for anyone.

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So nothing to back it up then?

I've read similar from several sources in the past. I'm sure if you google it something will pop up. Apparently we aren't breeding at the required replacement level of 2.1 kids per couple, its nearer 1.6 or somesuch. So it is mostly down to immigration to grow our population, and within that, higher-breeding immigrants. 'Tis even lower in Southern-European countries. So long as there is any ever-increasing immigrant population then there will be people to sell and rent to.

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Quite a few of the arguments on here make sense.

BTL, like all pyramid selling schemes has to be dead soon. Subsidisation for capital gains only makes sense when there is capital gains to be had.

If prices stagnate, people won't jump on.

The credit crunch will do it's job. Interest rates cannot stay at the historically low levels, and indeed they have gone up.

As for soft landing, b*llocks. Before I even found this site, I read a newspaper article talking about how many people were taking out liar loans, and I thought to myself, that could quite easily come to grief.

And as for the slight shortage of houses, that'll mean prices will only fall 30% instead of 45%.

If prices did soft land, and there is no crash then you can laugh at your landlord subsidsing you.

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If they go up I will buy one.

If they go down I will buy the same one, just have a few quid over as "savings".

No skin off my nose either way really.

I am just grateful the market's stopped while I am looking at areas/houses and deciding what I do want.

My wish list is so specific it might take me 3-4 years to find "the one" so it saves me grabbing something not quite right so as to not "miss out".

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STOP FEEDING THE TROLL!!!

HOW DO YO KNOW HE'S A TROLL?

LOOK AT HIS PREVIOUS POSTS, DOES NOT LOOK LIKE A TROLL TO ME..............

:unsure:

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I was having a discussion at work about house prices (everyone at work is a BTL landlord).

I found that, strangely very funny.

"I'm a BTL landlord."

"oh I'm a BTL landlord too"

"yes and Sandra in accounts has some BTL's too"

Of course the OP could of course work at an estate agents or a property letting company. I suppose pretty soon everyone will have been on Big Brother too.

If everyones a BTL landlord, where an earth do they think all the tenants are going to come from?

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I've read similar from several sources in the past. I'm sure if you google it something will pop up. Apparently we aren't breeding at the required replacement level of 2.1 kids per couple, its nearer 1.6 or somesuch. So it is mostly down to immigration to grow our population, and within that, higher-breeding immigrants. 'Tis even lower in Southern-European countries. So long as there is any ever-increasing immigrant population then there will be people to sell and rent to.

http://www.statistics.gov.uk/cci/nugget.asp?id=951

Will that do you?

http://www.statistics.gov.uk/cci/nugget.asp?id=6

This one's also good

Considering the state pension is a government run ponzi scheme I'm not looking forward to the next 20 years of paying tax in this country. :ph34r:

Guess we'll see a privatised NHS too, although with the voting system favouring the more numerous oldies we could come a little unstuck. :ph34r:

Edited by Kuma

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For the benefit of earlier posters asking about population increase/decrease in the future.

UK and other western populations are currently at a high point due to the baby boom, long term HPI is highly correlated with the shape of the baby boom population size. Over the next twenty years the effect will wear off. There is a paper from the Federal Reserve showing that computer models based on population size can accurately predict future HPI. I don't have the link right now. The interesting thing about the paper was that the original study was some time ago. The subsequent market peak in Japan was correctly predicted by their models.

If they last out for say 10-15 years many BTL landlords may find that the market is quite different for their properties. However I suspect that big institutions will be mopping up many small investors BTL properties long before that date.

If a BTL landlord is buying on an IO mortgage they are taking a huge risk on the future price that they will have to pay at the end of the mortgage period. The world will probably change a hell of a lot over the timespan that they are running the mortgage. Indeed, by 2020 the full shape of the shift of economies from West to East should be clearer. The BTL investors may have chosen the right approach, but who knows, there is an equal chance that they have just jumped onto another bandwagon.

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I have a small part of the evidence on paper.

Well, more in a tissue to be exact.

-_-:lol::lol::lol:

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http://www.statistics.gov.uk/cci/nugget.asp?id=951

Will that do you?

http://www.statistics.gov.uk/cci/nugget.asp?id=6

This one's also good

Considering the state pension is a government run ponzi scheme I'm not looking forward to the next 20 years of paying tax in this country. :ph34r:

Guess we'll see a privatised NHS too, although with the voting system favouring the more numerous oldies we could come a little unstuck. :ph34r:

Thank you Kuma.

"The UK has an ageing population. This is the result of declines in the mortality rate and in past fertility rates. This has led to a declining proportion of the population aged under 16 and an increasing proportion aged 65 and over.

In every year since 1901, with the exception of 1976, there have been more births than deaths in the UK and the population has grown due to natural change. Until the mid-1990s, this natural increase was the main driver of population growth. Since the late 1990s there has still been natural increase, but net international migration into the UK from abroad has been an increasingly important factor in population change. In the year to mid-2006 natural change was an important driver of change accounting for 45 per cent of total change."

So 55% ofthe change is now due to immigration not natural increase? Will they stay? Want to buy a house? Want a mortgage? Who knows........

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