Tuesday, October 12, 2010

Is the Express Finally Coming On Board?

GENERATION LOCKED OUT OF HOMEBUYING

Nothing new in this piece, but amazing to see it featured on The Express website. Is the last bastion of 'ever-rising house prices are a good thing' finally beginning to see the light? Of course, the article doesn't actually go on to suggest the bleedingly obvious point that prices need to come down, just stabilise...

Posted by rantnrave @ 11:59 AM (1353 views)
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7 thoughts on “Is the Express Finally Coming On Board?

  • sibley's b'stard child says:

    “The report called on banks and building societies to relax their lending regulations and said the Government should allow local authorities to act as guarantors of 100 per cent mortgages for key sector workers”.

    There you go; that’s the slant of the article right there.

    “Not only does this bar people from the…potential wealth creation that comes from owning a home…”

    Make your minds up; surely if you’re appealing for an end to boom-and-bust then you wouldn’t be advocating the illusory wealth creation of rampant HPI.

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  • mark wadsworth says:

    Good old Express. They use this as an excuse to call for MORE lending to sucker more people into overpaying, rather than calling for prices to fall (as SBC points out).

    More to the point, they truly do not have a clue what they are talking about. They (in all seriousness) blame the land price bubble on “Labour’s hikes in Stamp Duty”.

    Stamp Duty always used to be one per cent, and the exempt amount drifted up from £60,000 to £125,000 while Labour were in charge, and although they introduced 3% stamp duty for sales over £250,000 (which is a bit spiteful), this is hardly first time buyer territory, and frankly the 0% or 1% that nearly all FTBs would have been paying is neither here nor there.

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  • Sibley, you are spot on. Before even reading the article I knew that somewhere in it there would be a call to relax lending standards and increase in government subsidies.

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  • Who cares what Daily Express ‘journalists’ think?

    It was an important title in the 1930s – but it’s been downhill all the way ever since.

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  • If it wasn’t for 25 year mortgages, property wouldn’t be so leveraged.

    If you take away a mortgage, would the price still be 200K ? – I think not.

    It would be more like 40-50K. This is the problem, I say, lets get rid of mortgages, cash only price and then see what happens to how much a house is worth.

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  • Adam Smith Fan says:

    @5 debtfree said…

    If it wasn’t for 25 year mortgages, property wouldn’t be so leveraged. If you take away a mortgage, would the price still be 200K ? – I think not. It would be more like 40-50K. This is the problem, I say, lets get rid of mortgages, cash only price and then see what happens to how much a house is worth.

    Land prices can drop to zero but house prices can’t do that for long. The minimum sustainable price of a house is the cost of building a comparable house plus the land cost. Sure, you could buy an existing house for less in theory but that can’t go on for ever. Unfortunately the cost of building a house is high enough that most people will still require a mortgage, even with zero land costs.

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  • tenyearstogetmymoneyback says:

    The fundamental thing that the Express and co have forgotten is that before a mortgage can be given out someone has to deposit
    some money. Admittedly with Fractional Reserve banking you might be able to lend the same money several times, but if
    there isn’t any there in the first place, or even worse thge poeple who have lent money want it back, there aren’t going to
    be many mortgages.

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