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New housing for foreign investment - not the British!
http://www.dailymail.co.uk/news/article-2657470/The-REAL-reason-children-afford-buy-house-How-Chinas-middle-classes-snapping-British-homes-Liverpool-Croydon-theyre-built.html
Now this is NOT on, why are we building more property just for foreign investment.
Think these companies should be heavily taxed for doing so.
With prices continuing to rise it is totally unacceptable.
Last week, as countless young Britons gazed longingly into estate agents’ windows displaying homes they can never hope to afford, I attended a glitzy property jamboree 6,000 miles away that made a mockery of their plight.
Side by side, on stalls in a vast exhibition hall overlooking Hong Kong harbour, English estate agents vied like barrow-boys to sell flats and houses to cash-rich Chinese speculators who were using our booming housing market like some alternative stock exchange.
They didn’t have to work very hard. As one of the agents, Alice Macdonald of Knight Knox International, remarked jubilantly after sealing another quick deal: ‘These people are buying British property as if they were shopping in Tesco!’
As several buyers told me, they have no intention of travelling to Britain to see the ‘commodities’ they are snapping up like squares on a Monopoly board, much less living in them.
The agents believed many of them would buy. After all, almost a third of the 133 flats in The Edridge have been sold in the Middle and Far East two years before it is due to open. Zoe Jiang of developers Sloane International says the company hopes to sell out the entire building without needing to offer it to British buyers.
Now this is NOT on, why are we building more property just for foreign investment.
Think these companies should be heavily taxed for doing so.
With prices continuing to rise it is totally unacceptable.
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Comments
Unfortunately money talks and the people that matter, listen.
Whilst I generally hold "right wing" opinions I do not with regards to housing.
With many people in this country struggling to get on the property ladder, new homes are being built to "cater for demand" it is not right that property developers can see fit to sell what little is being created at property expos.
But you must remember that the Tories get most of their funding from bankers and property developers - often their school mates and Oxbridge chums - they come first not ordinary Brits wanting a home. Just remember who they are working for.
We are constantly being told that we aren't building enough houses. That's true. However, if foreign investments helps drive, and pay for, new developments then surely that is a good thing. If you want somewhere to rent then do you really care where your landlord lives? If you don't want foreign investment then you have to ask yourself where the money is going to come from to build over 100,000 homes a year.
Brits would buy them instead at more affordable prices - owner occupation is almost always best.
Developers are making a bomb - house prices cost 3 times what they were 15 years ago. The cost of building houses hasn't tripled!
In the end it's whether you want to live in a country that puts ordinary people first or spivs and speculators. We have the latter.
But if that is changing...
More people having to rent (at huge rents), fewer people buying, large number of foreign owners.
Then the political will to maintain this whole thing might not be there anymore.
Or at least it will be easier to begin a process of change.
So maybe these foreign buyers will likely regret putting money into a "sure thing". As will buy-to-let types in general.
The consequence of the 1980s' policy of creating a "property owning democracy" is the astronomical prices attached to property.
It would be interesting to see what the effect would be if every citizen over the age of 25 owned a home. It could be tested by a government giving the Right to Buy to all tenants with a 90% discount, be they private or social. Then we'd see how desirable such a policy really is.
Of course it's impossible for everyone to own their own home (dispite it being an almost universal aspiration) and the giant gulf being created between those who own and rent is perhaps irreparable unless house prices are allowed to fall by about 50%. That won't happen because each government knows that it would be political suicide, however, there will inevitably be an adjustment forced by necessity eventually.
Why would I want to rent a property and line someone else's pockets?
In some cases renting is not cheaper than buying and at least with buying you have something to show for it.
I think the issue is about timing with buying houses - and in a crazy frenzied market as we have now renting might make more sense in the short term.
As for lining someone else's pockets - whether you rent or buy the bankers win. Cos if you pay £250k for a house on a 25 year mortgage at 5% (not an unrealistic lifetime rate) - you actually pay back potentially £435k (of which £185k is a nice fat profit for your mortgage lender). So while rent can be argued as being money down the drain - so in one sense is paying your lender £185k in interest.:D
No wonder banks love high house prices.
Many people want to rent and have no interest in buying, even if they could afford it. Renting gives you the flexibility to move around the country (and the world) to work without being tied down with a mortgage and the responsibilities of home ownership.
What about those who want to buy and can't? There are many of those too.
If you can afford it.
Indeed there are. I was one for years while I saved up for a deposit.
However, you don't help these people by restricting the number of rented property available as you just increase the competition for places for sale and push up rents making it harder to buy.
The way you make property more affordable is by a massive building programme and by getting banks lending. However, neither of those is simple as who wants a few thousand new houses in their back yard and banks are still recovering from years of irresponsible lending.
I disagree; there are enough properties out there, just not enough affordable ones.
People who buy to rent are creating their own market for themselves because it restricts supply for first time buyers and pushes prices up as speculation continues unabated, as referred to in the article post by OP.
If there were punitive CGT for landlords or laws to protect tenants, you would drive people out of the rental game forcing house prices to drop, as the speculators would withdraw from the market, easy peasy.
Totally agree with that, also annoyed with the BBC for encouraging the practice with the raft of TV programmes they have (e.g Homes under the Hammer), etc) that make it look easy to become a BTL'er meaning more and more are getting in on the game.
And exactly what this 'boom' is built on.
That's the real reason for high house prices. Banks love rising assets and guaranteed money, and housing is as close to it as you can get. They know they can lend ever increasing amounts to pay for them because if the client can't afford it, they get their money plus some, through selling it and the rise in value since the loan was granted.
The public love a slice of 'free money' (the few) and governments love the extra money flowing in to the economy. It's an illusion at the expense of the young and can't go on forever.
(if it's a problem)
The houses I think I heard are worth 26 TRILLION in total!
And Cameron and Clegg say there is no housing bubble outside of London?!
Problem is that they dress this sort of thing up as 'investment in the UK', when in actuality, it's just 'speculation on the UK housing market'. It may make a minority of individuals rich, such as estate agents, property marketers and construction companies, but unfortunately the 99% of the rest of the country do not benefit from it at all.
Its why we need political parties to grow a pair, face down the press and their owners who cry red this and red that whenever someone wants to tackle this and basically grab the bull by the horns generally on this and put it right. That means repeating what was done after WW2, build loads of new towns again, replace the council homes sold by Thatcher, REVERSE THATCHER after all this time and if people don't like it tough.
I think it would get a lot of support but maybe not straight away because those who would benefit probably won't trust anyone to do it. If a political party was really serious about it though, they could make it crystal clear policy and make it a key priority/guarantee and be prepared to lose elections over it until the are believed and are elected to do it and then they should get on with it like what the Atlee Government did from 1945 onwards!
Which would just mean that every foreign national, even if they had lived here for years, would have to rent. That would just push up the demand for rented properties, especially in London.
I work with a German guy who has lived and worked in the UK for over 20 years. He cam here as a student and liked it so much that he has stopped. Why shouldn't he be allowed to buy a house?
The thing is if you take London for example. most of the new developments are luxury at around a minimum £1 million per flat upwards. Earls Court for example will be demolished along with two housing estates to be replaced with luxury homes. So not only will these flats be bought by overseas investors they will sit empty as they buy them to get the money off the books, so hardly anyone renting them and two estates which are a mix of council. housing association provising affordable homes will disappear. If you walk past the last lot of luxury blocks they built a few years back
you will find about 80% are sitting empty most of the year.
Nothing wrong with investors building if its affordable but there is a big problem with the type of developments that are being built.
As if there are not enough Luxury flats in London already.
Exactly and small businesses and existing affordable housing are being demolished to make way for these developments, its ridiculous.