Slumpmonkey Returns Posted September 2, 2008 Share Posted September 2, 2008 Look's like the press are having a field day with McStalin's "bail out" of the housing market! This article in the comment section by Ross Clark could have been written by one of us. Sentiment is definately on our side now and McStalin is finished now the Times (property porn newspaper of the year until recently) is printing stuff like this! September 2, 2008 How not to help first-time homebuyers If you don't own property already, falling prices are the best way to get you on the housing ladder Ross Clark Imagine - if you are not one of the several million people who falls into this category - that you are a frustrated first-time homebuyer. Over the past few years you have resisted the temptation to borrow six times your salary to buy a dingy one-bedroomed flat. Neither have you got together with a distant friend, or a stranger plucked off the internet, and bought a share of slightly brighter two-bedroomed flat. You would still like to own a home, but are happy to rent as you bide your time. You should listen out carefully this morning, because the Prime Minister has a plan to revitalise the housing market - and he says it is for your benefit. According to the advance billing, this will revolve around a large expansion in shared-equity housing, where you buy half of a house and the Government buys the other half. Mr Brown also wants to try to arrest the slump in house prices by giving councils money to buy up homes under the threat of repossession and to underwrite billions of pounds of mortgage loans. Another plan that was floated earlier in the year would have given buyers of properties worth less than £250,000 a stamp-duty holiday, saving a levy of 1percent on the house's value. Try as you might, you could have a problem working out how any of these measures will benefit you. The problem of unaffordability in the housing market is rapidly being solved without government intervention. According to the Nationwide Building Society, house prices have fallen by 10.5 per cent in a year. Why then, would you want to invest in half a house now when, if you wait for a year or two, you will be able to afford the whole house? Moreover, why should you want your taxes used to bail out feckless homeowners who borrowed too much during the boom and, worse still, the greedy banks that lent it to them? Even the stamp-duty holiday would have been only a temporary reprieve. Who wants to buy now and save 1per cent in tax when house prices possibly still have a further 30 per cent to fall? None of the measures announced today will genuinely be in the interests of first-time buyers - it just sounds better if they are promoted in that way. In reality, they are a crude attempt to buy the votes of those who already own property and are feeling a little sick at the diminishing value of their investments. Pour a bit of public money into the housing market, Mr Brown figures, and it might just be possible to re-create the glory days of the 1997-2007 property boom, when voters felt a warm glow from effortless wealth creation and began to believe his propaganda that he had put an end to boom and bust. The moral hazard of bailing out the housing market is serious enough - by protecting borrowers and lenders from the consequences of their actions, the Government will simply be encouraging even more reckless behaviour in the next housing boom. But perhaps we should not be overly bothered about this, as any attempt to buck the housing market will be doomed to failure - just like the Tory Government's efforts in the early 1990s to buck the currency market under the exchange-rate mechanism. The Government first tried to underpin the housing market in April when it swapped £50 billion worth of government bonds for mortgage-backed securities. The result? The banks said thanks very much but carried on as they were doing before - tightening lending criteria and raising mortgage rates. The Bank of England's figures for July show just how seriously mortgage lending has collapsed - and demonstrate just how much the Government would have to spend to re-create the boom. In July 2007, lenders advanced a total of £17.2billion to homebuyers. In July 2008 they advanced only £4.3billion. If the Government was going to step in and make up the weight of money that has been lost from the property market it would have to double income tax or close the National Health Service. In any case, who really wants a return to the days of mass council-owned housing? When property prices were rising rapidly the Government did much to encourage the sale of council housing stock - the number of council-owned homes has fallen from 6.1 million in 1997 to 2.5 million today. It did so for the same reason that the Tories sold council homes in the 1980s and 1990s - home ownership encourages self-reliance and diminishes the number of social ghettos. To force taxpayers to rebuild a stock of council homes now in a falling market is not just perverse; it would also rank alongside Gordon Brown's sale of gold reserves at the bottom of the gold market in 1999 as one of the most crass cases of public investment ever. There are few problems so bad that a government cannot make them ten times worse by intervening. The housing market is no exception. Much as it will cause pain to those who bought too late into the dream of home ownership, the only sensible policy is to stand back and let the market find its own level. http://www.timesonline.co.uk/tol/comment/c...icle4656239.ece Quote Link to comment Share on other sites More sharing options...
lepa1972 Posted September 2, 2008 Share Posted September 2, 2008 Look's like the press are having a field day with McStalin's "bail out" of the housing market! This article in the comment section by Ross Clark could have been written by one of us. Sentiment is definately on our side now and McStalin is finished now the Times (property porn newspaper of the year until recently) is printing stuff like this! Indeed. I read that on the way into work this morning and thought "Bingo". To be fair to the Times, however, I think they are a fairly broad church. They will happily print property ramping stuff from Anne Ashworth once a week in the Homes and Gardens section or whatever it calls itself, while printing more reasoned arguments in the main paper. They have had a number of leaders, and one-off articles, calling for a substantial correction in house prices for a least a good many months now, if not years. Quote Link to comment Share on other sites More sharing options...
Moo Posted September 2, 2008 Share Posted September 2, 2008 Murdoch's Times Tells it How it is! Important word, that. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted September 2, 2008 Share Posted September 2, 2008 Looks like the press have got fed up with govt spin now. Brown is finished. Quote Link to comment Share on other sites More sharing options...
Bubble&Squeak Posted September 2, 2008 Share Posted September 2, 2008 http://www.timesonline.co.uk/tol/comment/c...icle4656239.ece I think HPC.co.uk should buy a nice frame and a copy of the times and send this article, framed, to Kirsty Alsopp Quote Link to comment Share on other sites More sharing options...
buzzardo Posted September 2, 2008 Share Posted September 2, 2008 Comments up to 63 now, and I could only find a couple who were daft enough to think this blatant government bribe is a good idea. The other 61 were outright condemnation of a stupid idea, from a stupid man. Call an election now, tw@tfeatures Brown - the game is up and you're done for. Will Cameron be any better? Who knows, but I'd rather have my two year old George run the country than this bunch of w@nkers. At least he's got some charm and innocence left! B Quote Link to comment Share on other sites More sharing options...
Slumpmonkey Returns Posted September 2, 2008 Author Share Posted September 2, 2008 I think HPC.co.uk should buy a nice frame and a copy of the times and send this article, framed, to Kirsty Alsopp Krusty can't handle The Times (too many big words)! Send her a nice hat to eat instead. Quote Link to comment Share on other sites More sharing options...
dinsdale Posted September 2, 2008 Share Posted September 2, 2008 Looks like the press have got fed up with govt spin now.Brown is finished. Yes, time now to go in for the kill. Not enough for Zanu to be beaten, they must be atomised. The end of the Labour Party at every conceivable level of power. All they have brought into our everyday lives is stress, anxiety, hassle and expense. Nothing but a bunch of emotionally stunted control freaks, vandals, bullys and nanny statists. Quote Link to comment Share on other sites More sharing options...
the end is a bit nigher Posted September 2, 2008 Share Posted September 2, 2008 There's no denying that Broon's announcements seem to have worked out nicely for HPC Quote Link to comment Share on other sites More sharing options...
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