Allotments 4 All

I feel sad for the kids,stupid money fo a tiny box..............

Quote from: Ellen K on September 14, 2011, 21:38:40
Sure, people should be able to afford a decent home nobody is arguing any different - but that doesn't mean they need to buy it.

It is this British obsession with owning a house that has driven up prices in the first place.

And the Buy-To-Let boom has distorted it even further.

Edited to add: my original comment replied to UW's post about how house prices must come down several fold so that everyone could afford to buy.  I'm not denying the right to buy, nor that house prices shouldn't fall, just that one should drive the other.

The cost of renting is coupled to the cost of buying - buy-to-let exists because people will pay more in rent than they would mortgage repayments. 

Why do you suppose landlords rent property - because they're kind hearted?  No, it's because there's money to be made from investing in property and letting it out - and that's money people can't afford to pay.

Like Betula said, it's supply and demand.  Change the planning system so that anyone can build themselves a house for £20k on any bit of land and there's no market in building starter homes for £200k.

If people are paying more rent than they'd be paying a mortgage, then why aren't they paying a mortgage?

Deposit

Quote from: Ellen K on September 14, 2011, 22:31:33
If people are paying more rent than they'd be paying a mortgage, then why aren't they paying a mortgage?

Quote from: betula on September 14, 2011, 22:36:04
Deposit

If you are looking at buy to let, you have 50% + deposit so the rent you charge to cover the remaining mortgage is far less than a 90% + mortgage a first time buyer will have to pay. In a lot of areas the cost of even a bedsit is greater than a lot of people can afford to buy. Basically if you haven't got on the bandwagon yet or don't have a well paid job you are stuffed.

Why would I like to own my own home? Because then I can do what I want with it, decor, proper insulation, improvements......

Oh and around here you can't get a building plot for 200k so forget self build.

According to article in Telegraph  there's enough brownfield land available for building 3 million homes, plots owned by buildeers with planning permission for homes nearly 300,000, homes left empty for more then 6 months 300,000 (info sources looked reputable).
This suggests there is already plenty of capacity for new houses without building indiscriminately on greenfields. The reform will take away any brownfield priority, I believe.

But the logic doesn't work.  Prices must come down because it's so important to buy.  Yet what has driven prices up is the importance of house ownership.

And BuyToLet is based on house values rising.  So that the rent plus the increase in value of the asset gives a guaranteed return, better than the risk of the stock market.

The rental market is highly fragmented.  So you get houses of multiple occupancy (students) and executive-type temporary rentals.

And then there are what used to be called DHSS.  In reality, this works as a business because the state funds it.  Landlords charge as much as the benefits system will pay.

If you are not in one of these cats then you are struggling.  But the days when you could buy a bit of land for peanuts and build a house for 20K aren't coming back, if they ever existed.  And you would still need the peanuts and the 20K to do it.

Is renting so bad though??

A relative lives in a large house in a good area,all repairs someone elses problem.She would neve be able to afford to buy a propety like that............so she has the lifestyle.

I think in this country people are made to feel somehow second class if they rent.

Most people rent in France,so I have read anyway.

According to the link below, the average UK house price is £228,095 and average prices fell 2.9% over the year ending April 2011.

So, if you bought an average house a year ago it would have cost you £6,614 in lost capital.

A good mortgage rate at the moment would be 3% (if you had a 40% deposit), with a fee of say £1,000, so another £5106.

Your deposit could have earned 2% after tax so another £1824

Stamp duty at 1% would be £2281

Conveyancing £500

Survey/Val £500

That comes to £16,825 over the first year.

A buy to let landlord might expect 5% from an easy to manage property, which would be £11,405 a year plus the time it takes, plus maintenance, plus tenancy voids.

Just saying it's not always best to buy, even if you have the deposit.

http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/houses.stm