It's time to give up the dream of home ownership

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falkor
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It's time to give up the dream of home ownership

Post by falkor » Sat Dec 12, 2009 8:55 am

People should get used to idea of long-term renting, housing spokesman argues

By Andrew Grice, Political Editor
Image Owen Armstrong doesn't intend to buy a house due to the huge deposit payments involved
11 December 2009
The era in which all Britons aspire to own their own home may be coming to an end, according to the Housing minister, John Healey. In a controversial speech, he suggested that Britain may be moving towards a European model, with renting on a roughly equal footing with buying. He said home ownership had fallen from 71 per cent of households in 2003 to 68 per cent today, noting that this trend began in 2005, well before the recession. "I'm not sure that's such a bad thing," he said.

Mr Healey, a close ally of Gordon Brown, challenged the assumption behind housing policy under both the Tories and Labour since Margaret Thatcher introduced legislation to allow council tenants to buy their homes 30 years ago this month. It led to two million homes being sold to tenants. "You don't need to be a grocer's daughter to know it is not a good idea to have all your eggs in one basket," Mr Healey told the Fabian Society. "Yet not even a drop in the housing market can convince people not to use their home as a store of wealth." He said almost a third of people rely on their home to top up pensions. "The property piggybank is unsustainable and unfair," he added.

The number of first-time buyers getting parental assistance has doubled in just three years to four out of every five.

"Increasingly, those without the property-funded 'Bank of Mum and Dad' are finding it hard to buy homes of their own," Mr Healey said. The gap has widened in the recession, during which the average age of first-time buyers getting parental assistance has stayed the same but the average age of a first-time buyer without parental help has risen from 33 to 37. "As housing wealth is passed from parents to children, inequality is compounded over the generations," he said.

Mr Healey stressed that a similar status between forms of housing tenure did not mean hostility to home ownership, and emphasised a need to find new ways to support those who wanted to become homeowners.

A new model with greater flexibility is needed, he argued, allowing people to change from buying to renting without moving home. "Not all or nothing, but a flexible system which suits the different stages in people's lives," he said. "In the future, I'd like to see it be just as easy to sell equity in your home back to the council, housing association or co-operative, allowing people flexible tenure in the same property that adapts to their circumstances. People may choose to release equity whenever it suits them and build it back up when they can and if they want."

The pre-Budget report, announced on Wednesday, included commitments to consult on how to increase the supply of housing for private rent. Mr Healey said decisions "about new institutions through tax changes and incentives" were likely to be made in time for the Budget next March.

The Government has recently started to allow more building by councils, while housing associations rent 2.2 million homes. Mr Healey wants to expand the number of homes built for private renting by encouraging smaller housebuilders, and seeks a greater role for co-operatives, mutual societies and other third sector providers.

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mj12cz
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Re: It's time to give up the dream of home ownership

Post by mj12cz » Sat Dec 12, 2009 10:41 am

I can see this is going to happen.

I'm lucky, I have a House in the uk which I own with a mortgage and about 50% equity in it, but then we have property in Czech republic which the family own out right.

I will retire in Czech so I'm not bothered if I pay off the mortgare on the UK property or not!

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falkor
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Re: It's time to give up the dream of home ownership

Post by falkor » Thu Dec 17, 2009 9:58 am

I do feel sorry for the younger generation though

it seems as if the deposit demanded by banks nowadays is so huge - you would need two people in full time high paying jobs to get a mortgage e.g. two Drs getting a house together

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Re: It's time to give up the dream of home ownership

Post by mj12cz » Thu Dec 17, 2009 4:50 pm

I agree, I'm thankful bot my kids already have properties however not in the UK. We have split the main farm house in Czech into two flats and they have been given to Misha and Daniel.

I don not think they will ever be able to own a property in the UK.

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Re: It's time to give up the dream of home ownership

Post by falkor » Sun Mar 14, 2010 10:39 pm

if you earn £15000 then you could get a mortgage of £45000

the bank will lend you 3 x your salary

Prison Officers are now starting on £15000 a year

so they could buy a house for £45000

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mj12cz
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Re: It's time to give up the dream of home ownership

Post by mj12cz » Mon Mar 15, 2010 7:53 am

falkor wrote:if you earn £15000 then you could get a mortgage of £45000

the bank will lend you 3 x your salary

Prison Officers are now starting on £15000 a year

so they could buy a house for £45000

Its scary, I can see things going like some parts of Europe where you long term rent.

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Re: It's time to give up the dream of home ownership

Post by dave3974 » Sun Oct 26, 2014 5:05 pm

property ownership is deeply embedded in our culture---------so sad that things are going wrong

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