Property crash, just maybe it really is different this time

[JoeDavola]

And this block that was evacuated in April 2019 has been lying empty for four years and counting...still hasn't been repaired the court case still ongoing - 91 apartments fucked:

https://www.bbc.co.uk/news/uk-northern-ireland-49772639

Edited May 26, 2023 by JoeDavola

[wherebee]

7 hours ago, spunko said:

I do but I oppose unearned wealth so if I were PM I'd deal with that particular bugbear. In the example I gave, inheritance tax doesn't make any difference - they just plan around it, as most wealthy people do, and rarely pay it. Seems to be a tax for the little people.

Unearned wealth is something I cannot fucking stand personally, but I think I'm pretty much alone in that viewpoint.

Complaining about unearned wealth is like complaining that not all people are born perfectly equal in looks.  Your parents give you stuff - sometimes genes, sometimes money.  Both help with life.

Plus, as you say, any inheritance tax will be sidestepped by the rich.  Count on it.

I'd rather have more consumption taxes at the top end.  Want a private jet?  Sure.  50,000 quid per landing.

 

[JoeDavola]

@Bobthebuilder I can see you reading at the moment - can I ask do you know if apartment blocks in England as dodgy as the NI ones seem to have been the last 20 years? Seems they've made an especially huge fuck up of them in NI.

Edited May 26, 2023 by JoeDavola

[Chewing Grass]

19 minutes ago, JoeDavola said:

And this block that was evacuated in April 2019 has been lying empty for four years and counting...still hasn't been repaired the court case still ongoing - 91 apartments fucked:

https://www.bbc.co.uk/news/uk-northern-ireland-49772639

Superbly uninformative piece from the BBC News there, flats closed, secret structural issue, shops OK, meeting next week.

Rest was irrelevant padding.

[One percent]

7 hours ago, spygirl said:

15% of a ~3 LTE mortgage will be struggle - and it was for people in the 90s.

15% of a 10x LTE is a no do.

MIRAS was at play, sothe cost just wasnt as much as they claim.

 

 

Miras ended a bit before the 15 percent interest rates. It’s ending is what drove the mad gaiz just before the 1990 crash. 

[JoeDavola]

5 minutes ago, Chewing Grass said:

Superbly uninformative piece from the BBC News there, flats closed, secret structural issue, shops OK, meeting next week.

Rest was irrelevant padding.

https://www.belfastlive.co.uk/news/belfast-news/victoria-square-apartment-block-images-16144250

"Photos have also emerged of the first signs of the damage - when steel reinforcement broke through the wall of one apartment two and a half months ago. Last week residents in the complex were told to leave their homes immediately for safety reasons."

Edited May 26, 2023 by JoeDavola

[Bobthebuilder]

5 minutes ago, JoeDavola said:

@Bobthebuilder I can see you reading at the moment - can I ask do you know if apartment blocks in England as dodgy as the NI ones seem to have been the last 20 years? Seems they've made an especially huge fuck up of them in NI.

Hi Joe,

Yes its not just flats but new builds in general, not all builders are bad but I reckon its down to the quality of the trades they are using, incorrect spec of materials and just bad workmanship.

I wouldn't buy a flat or house that's been built in the last 25 years, unless it was built by a smaller top quality company, and there's not many of those about.

If I was going to buy a house today, I would go for one of the post war council houses, strong as fuck and usually a big garden.

[Bobthebuilder]

5 minutes ago, JoeDavola said:

https://www.belfastlive.co.uk/news/belfast-news/victoria-square-apartment-block-images-16144250

"Photos have also emerged of the first signs of the damage - when steel reinforcement broke through the wall of one apartment two and a half months ago. Last week residents in the complex were told to leave their homes immediately for safety reasons."

That building is going to fall down.

[JoeDavola]

3 minutes ago, Bobthebuilder said:

If I was going to buy a house today, I would go for one of the post war council houses, strong as fuck and usually a big garden.

Yep the council houses in NI are some of the best housing stock we have really. They seem to age the best.

[wherebee]

9 minutes ago, Bobthebuilder said:

That building is going to fall down.

chinese steel?

[Bobthebuilder]

6 minutes ago, JoeDavola said:

Yep the council houses in NI are some of the best housing stock we have really. They seem to age the best.

Post war they built a few council houses in nice villages in Dorset, its those that I keep an eye out for. As you can imagine they usually sell pretty quickly.

[Bobthebuilder]

1 minute ago, wherebee said:

chinese steel?

And a incorrect concrete mix I expect, seen that myself when an extension has been done and the building inspector has failed it.

[JoeDavola]

2 minutes ago, Bobthebuilder said:

Post war they built a few council houses in nice villages in Dorset, its those that I keep an eye out for. As you can imagine they usually sell pretty quickly.

In NI there's generally a cap in prices on them as there is the spectre of the troubles looming over most council estates - most of which are very polarized to one side of the community or the other. Shame as they're great houses.

Edited May 26, 2023 by JoeDavola

[One percent]

2 minutes ago, JoeDavola said:

In NI there's generally a cap in prices on them as there is the spectre of the troubles looming over most council estates - most of which are very polarized to one side of the community or the other. Shame as they're great houses.

A few more boat loads will sort that out.  

[Bobthebuilder]

3 minutes ago, JoeDavola said:

In NI there's generally a cap in prices on them as there is the spectre of the troubles looming over most council estates - most of which are very polarized to one side of the community or the other. Shame as they're great houses.

Never thought of that, crikey the old troubles still run deep.

I wouldn't worry about me buying an ex council house in England, as I grow weed, smoke, drink, play the drums and punk rock guitar. I AM the neighbour from hell

 

 

[JoeDavola]

2 minutes ago, Bobthebuilder said:

Never thought of that, crikey the old troubles still run deep.

I wouldn't worry about me buying an ex council house in England, as I grow weed, smoke, drink, play the drums and punk rock guitar. I AM the neighbour from hell

Sounds like the ideal neighbour to me!

[Rare Bear]

20 hours ago, spunko said:

This is accurate based on what I'm seeing. Round here all the landed gentry types buy their 20 something children a flat in Zone 2, which they live in for a few years, then flog it when the children start to have their own children. At that point they move back to the area they grew up in and mummy and daddy buy them a larger house nearby using the equity. 

One of my loaded neighbours sold their home for a few million so that they could buy their 3 kids houses just recently.

Often mummy has never worked from what I can tell, she just married into wealth, and the cycle repeats and the unearned wealth gets transferred down to each generation. 

I'd be more inclined to call it retained wealth rather than unearned wealth.

[Rare Bear]

8 hours ago, spygirl said:

15% of a ~3 LTE mortgage will be struggle - and it was for people in the 90s.

15% of a 10x LTE is a no do.

MIRAS was at play, sothe cost just wasnt as much as they claim.

 

 

I forget how much tax relief was actually allowed but if we assume that basic rate tax was 20% and that tax relief was allowed on all of the mortgage interest the 15% headline mortgage rate would have been 12% in reality. Can't remember the exact figures but the tax relief was being phased out around then.

MIRAS was just the name for the scheme whereby the tax relief was calculated by the lender and the payment reduced accordingly. What has been taken away is the tax relief.

Long before the name MIRAS was coined there was what was termed an option mortgage. Same thing, different name.

[Rare Bear]

8 hours ago, JoeDavola said:

I think the core problem here is the ever shrinking ability to buy 'essentials' i.e. shelter, food, heating, transport, relative to average salaries.

If the rich want to hand their kids money to do rich people stuff with then fine, many people don't need fancy holidays or holiday homes or really expensive cars to be happy...the problem is the basic life you can live as someone who starts with nothing and gets no state help just continues to get worse.

Of course if the state didn't interfere the person who started with nothing would probably do ok. It's not so much lack of state help as the existence of state interference.

[JoeDavola]

2 minutes ago, Rare Bear said:

Of course if the state didn't interfere the person who started with nothing would probably do ok. It's not so much lack of state help as the existence of state interference.

I'm not actually sure that's true at this point. I think a shrinking pool of folk would still be holding all the assets.

I don't actually know what the answer is, I don't think anyone does.

[Wight Flight]

10 minutes ago, Rare Bear said:

I forget how much tax relief was actually allowed but if we assume that basic rate tax was 20% and that tax relief was allowed on all of the mortgage interest the 15% headline mortgage rate would have been 12% in reality. Can't remember the exact figures but the tax relief was being phased out around then.

MIRAS was just the name for the scheme whereby the tax relief was calculated by the lender and the payment reduced accordingly. What has been taken away is the tax relief.

Long before the name MIRAS was coined there was what was termed an option mortgage. Same thing, different name.

Was capped at the interest on the first £30k. Double for joint mortgagees.

[Rare Bear]

1 minute ago, Wight Flight said:

Was capped at the interest on the first £30k. Double for joint mortgagees.

I couldn't remember what the cap was but I do remember the multiple reliefs for multiple buyers. The announcement of the forthcoming end of that led to the late 80s panic fueled price surge.

[Petatep]

40 minutes ago, Bobthebuilder said:

Post war they built a few council houses in nice villages in Dorset, its those that I keep an eye out for. As you can imagine they usually sell pretty quickly.

Same around here in the Yorkie Dales. A few houses in every village and very well built. Most were bought under Thatcher but luckily for us the Southern incomers aren't too keen on them so when they come up for sale us locals get a look in. The Southerners are welcome to the damp ridden period stone built cottages they favour.

[Rare Bear]

1 hour ago, One percent said:

Miras ended a bit before the 15 percent interest rates. It’s ending is what drove the mad gaiz just before the 1990 crash. 

It was the ending of multiple reliefs that caused the mad price surge. Or rather the announcement of it well before it happened. 

A sort of precedent for the Cyclops announcing the sell off of gold.

[Guest]

8 hours ago, spygirl said:

I thinkthe core problem is leverage and weak £.

Rising IR will strenghne the pound and get rid of a lot of the imported infaltion.

The leverage sitations is more strange.

Itseverywhere,. much more than the 90s crash.

Credit cards,. PCP, mortgge BTL, 2nd home.

The people who have borroweed nleveraged are a pretty small percentage.

But they are doign all the borrowing o nthe bhealf of the rest of the population.

Leverage is a fucking killer.

 

 

Yes, it seems that the pain of higher interest rates is going to be felt by a fairly small number of households. Something like 4-5 million highly leveraged owner occupier households + 1-2 million leveraged BTLers. The other 30 million households are not carrying very much debt.