Fixing the current Economic crisis in the UK

23 Nov 2010

OK - a theory.
The UK is overpopulated and there is a shortage of housing. The Construction (and allied) industry has the potential to bring the country out of recession because of the number of people directly and indirectly involved in those industries.
The allegation is that property prices are too high but the reality is that the construction industry is being surpressed by ridiculous lending constraints forcing prices down and devastating the construction industry.
A solution?
What if lending institutions were forced to lend competitively and the government constrained "greed" by utilising CGT to better effect thus enabling people who could afford it to buy their own homes as opposed to have to wait for an inheritance or bank of Mum & Dad loan to pay a 30% deposit and totally de-risk the lender. Surely all business is risky but lenders at the moment seem to be completely de-risking by only lending to A1 candidates AND devaluing what they are buying to make them pay ever larger deposits.
I say - Let the construction industry bring the country out of recession by forcing lenders to lend competitively. The current knee jerk reaction and over zealous FSA limitations are doing no one any good. The UK is uniquely placed to come out of the world wide recession led by the construction idustry and supported by pro active lenders.
Your thoughts?

23 Nov 2010

Imply common sense. There is no restriction on how much rent you are allowed to pay yet people already paying £800+ rent a month are told they can not afford a £700 a month mortgage. There were once schemes where you could rent for a year prove you paid the rent and get a mortgage that way, believe Halifax did one. These seem to have vanished now. Banks need to start actually evaluating peoples ability to pay instead of saying in a monotone voice "You can borrow three times what you earn and one times your partners salary"

24 Nov 2010

not sure.......but what I do know is it was irresponible lending that got the banks in the mess in the first place.
What about Government building more council homes for reasonable cost rent. That would force the other private landlords to bring their rents down as well. It would stimulate building in the same way. Yes would cost us money.....but would get it back and more in rent in the long run !!!!
The only thing I would stop is the right to buy scheme. To many people used that as a cheap way to get a house. If you rent off the council....It is the same as a private landlord.

24 Nov 2010

Quote by deancannock
not sure.......but what I do know is it was irresponible lending that got the banks in the mess in the first place.
What about Government building more council homes for reasonable cost rent. That would force the other private landlords to bring their rents down as well. It would stimulate building in the same way. Yes would cost us money.....but would get it back and more in rent in the long run !!!!
The only thing I would stop is the right to buy scheme. To many people used that as a cheap way to get a house. If you rent off the council....It is the same as a private landlord.

Problem is with having the government build more homes is ... they dont sad

All built by Housing associations now.
As for the right to buy I agree 100% it should be scrapped. I could write a book on how to become rich the easy way by doing not a lot. The right to buy scheme would be one chapter in the book. If you are able to as well hold out for a corner house and like so many people round by us sell your newly acquired cheap garden off to a builder or have a house built there yourself and roll in the ££££££'s.
Property has become a huge part of our lives over recent years. There are at one end of the scale people who cant get on the ladder :( and at the other end single children who's parents split up and both bought property who are inheriting anything from 200k to a million? dunno

It goes without saying now that if your parents bought a property and you are one day to inherit it will be a significantly larger sum now than in any point in history.

24 Nov 2010

Quote by deancannock
not sure.......but what I do know is it was irresponible lending that got the banks in the mess in the first place.

I tend to agree with dean here.
The Irish, Portuguese and impending Spanish problems extend from an over willingness to loan against real estate leaving massive housing estates which are empty and have (never will be) lived in.
Maybe a quick think out of the box... as we are all in one "happy slappy" Eurozone, why not send people to these countries to fill up their vacant stock?

24 Nov 2010

Quote by tweeky
not sure.......but what I do know is it was irresponible lending that got the banks in the mess in the first place.
What about Government building more council homes for reasonable cost rent. That would force the other private landlords to bring their rents down as well. It would stimulate building in the same way. Yes would cost us money.....but would get it back and more in rent in the long run !!!!
The only thing I would stop is the right to buy scheme. To many people used that as a cheap way to get a house. If you rent off the council....It is the same as a private landlord.

Problem is with having the government build more homes is ... they dont sad

All built by Housing associations now.
As for the right to buy I agree 100% it should be scrapped. I could write a book on how to become rich the easy way by doing not a lot. The right to buy scheme would be one chapter in the book. If you are able to as well hold out for a corner house and like so many people round by us sell your newly acquired cheap garden off to a builder or have a house built there yourself and roll in the ££££££'s.
Property has become a huge part of our lives over recent years. There are at one end of the scale people who cant get on the ladder :( and at the other end single children who's parents split up and both bought property who are inheriting anything from 200k to a million? dunno

It goes without saying now that if your parents bought a property and you are one day to inherit it will be a significantly larger sum now than in any point in history.
just to highlight the red point Tweeky.....this is correct, but it is because the councils are not allowed to borrow money for council housing. This is exactly what I am saying....LET the councils borrow money....they can build houseing stock for reasonable rent. As I say over the years they will pay back the loan, and have extra revenue then coming in. For me everyone is a winner.

25 Nov 2010

Quote by deancannock
just to highlight the red point Tweeky.....this is correct, but it is because the councils are not allowed to borrow money for council housing. This is exactly what I am saying....LET the councils borrow money....they can build houseing stock for reasonable rent. As I say over the years they will pay back the loan, and have extra revenue then coming in. For me everyone is a winner.

Why remove aspiration from peoples psyche? It is aspiration and planning for a better life that motivates societies all over the world. Why suppress that by condemning people to only rent from the council?
I have been researching my own theory and discovered that the reason for the lack of lending is simply a lack of funds to lend ! So banks are only lending their limited funds to the best cases and requiring higher deposits to make the available funds go further AND get more arrangements fees from those people.
The French banks seem to have it about right and they have had no financial crisis at all - they just treat every case individually and require a full status application and if you fit the bill they will lend you 100% - or 90% or 80% whatever your profile supports.

25 Nov 2010

I've read that France has France' is "7z4fg5pE8GbDA5zU Euro in debt, which is worth about 77 percent of the country's gross domestic product, according to the state statistics agency". Along with the fact that a third of the population is employed by the state puts France on a slow boil to somewhere nasty, The fact that there is less individual debt, partly due to far less mortgages and far stricter lending codes, means that though the initial "crunch" of the credit crunch isn't so devastating in the short term it in no way means its not there.
Add this together with France and Germany possibly getting a bit worried about the Euro wobbling as it is at the moment Germany not helping with any loans to help flagging failing Eurozone countries and France not big enough to do it on it's own they are both, possibly, going to protect their own economies and Euro status rather than risk helping out with the other struggling states. Damn good job Britain, just at present time,didn't join the Euro a bit back.

25 Nov 2010

Quote by flower411
But some people simply aspire to have stable predictable lives !
To force your own aspirations on others is unfair and may well lead them in to situations that they are unable to cope with.
I purchased an ex local authority house about seven years ago and among my neighbours were people who had been living in the 1950`s houses since they were built. Some had taken advantage of the right to buy and had found it to be the worst move they ever made ...others had remained tenants and were happy as ya like !!

Bang on the money Flower :thumbup:
I bought a house in 1990 had a good job paying good money partner(ex) earning ,well money. Mortgage rate at 9% cushty by 1993 Mortgage at % the construction industry shit out closing the place I worked Ex lost job in 2 months we went from being £400 in debt on overdraft to £4000 in debt and climbing. House was in 25+ neg equity shit was hitting the fan all over the shop neither parents able to help so handed the keys back to the building society leaving me tens of thousands in debt bloody near suicidal but still got another job paying a 1/3 of what I was on tried coping with the debt, not helped because I couldn't get time from work to go see people and was also not in a fit mental state to help myself debt just increased. Took over a year to get some order in my life such as a place to live not the car get rid of the ex (a good thing) and sort shit out. It is now 2010 17 years later and i still owe after paying, and still paying, out the best part of all i've had for over half my working life. Am I bitter? Well i bloody well was. I'm more philosophical about it now but it kicked the freaking aspiration out of me. I like nothing more than the idea of stable work stable finance, however fucking low it fucking is, and roof over my head that aint going to be taken away at a moments notice.
Not everyone has to be aspirational, if they were then there would be so many more disillusioned people out there. There is something to be aid for the status quo for many. I certainly don't want to live on the adrenaline rush that comes with debt ever again.

25 Nov 2010

i'm sorry to inform you all that unless the creation of credit (money) is in the hands of a government of the people, by the people, for the people, while it is in the hands of private banks (the private bank of england company limited), there is no other solution to the contrived deliberate debt crisis that is intended to us all of our wealth and impoverish us all into serfdom. those of us who survive that is.
i ask again, if the existing government of the u.k. can instruct the bank of england to print money, then who the fuck do we owe it to ?

25 Nov 2010

Quote by Lost

But some people simply aspire to have stable predictable lives !
To force your own aspirations on others is unfair and may well lead them in to situations that they are unable to cope with.
I purchased an ex local authority house about seven years ago and among my neighbours were people who had been living in the 1950`s houses since they were built. Some had taken advantage of the right to buy and had found it to be the worst move they ever made ...others had remained tenants and were happy as ya like !!

Bang on the money Flower :thumbup:
I bought a house in 1990 had a good job paying good money partner(ex) earning ,well money. Mortgage rate at 9% cushty by 1993 Mortgage at % the construction industry shit out closing the place I worked Ex lost job in 2 months we went from being £400 in debt on overdraft to £4000 in debt and climbing. House was in 25+ neg equity shit was hitting the fan all over the shop neither parents able to help so handed the keys back to the building society leaving me tens of thousands in debt bloody near suicidal but still got another job paying a 1/3 of what I was on tried coping with the debt, not helped because I couldn't get time from work to go see people and was also not in a fit mental state to help myself debt just increased. Took over a year to get some order in my life such as a place to live not the car get rid of the ex (a good thing) and sort shit out. It is now 2010 17 years later and i still owe after paying, and still paying, out the best part of all i've had for over half my working life. Am I bitter? Well i bloody well was. I'm more philosophical about it now but it kicked the freaking aspiration out of me. I like nothing more than the idea of stable work stable finance, however fucking low it fucking is, and roof over my head that aint going to be taken away at a moments notice.
Not everyone has to be aspirational, if they were then there would be so many more disillusioned people out there. There is something to be aid for the status quo for many. I certainly don't want to live on the adrenaline rush that comes with debt ever again.
Lost, once you handed back the keys to any property you owned what was to stop you going bankrupt? Probably would have been an easier way out of the situation and by now you would be in a far better position.
Just a thought smile

25 Nov 2010

Quote by flower411
But some people simply aspire to have stable predictable lives !
To force your own aspirations on others is unfair and may well lead them in to situations that they are unable to cope with.
I purchased an ex local authority house about seven years ago and among my neighbours were people who had been living in the 1950`s houses since they were built. Some had taken advantage of the right to buy and had found it to be the worst move they ever made ...others had remained tenants and were happy as ya like !!

No problem at all that some people are non aspirational - everyone is different. I am not forcing my beliefs on anyone, simply stating a fact that it is aspiriration, which manifests itself into competitiveness which makes the world go round.
However the comments you made in your last paragraph - without qualification - are somewhat suspect. Current variable rates on long standing mortgages are around 2.5% meaning that the interest payable on a £100,000 mortgage is around £200 / month. I rent out around 6 properties worth that sort of money for between 500 & 595 a month and I suspect that council rates are not much less cos four of my six are DHSS supported without an issue. So who has the better deal- the owner, or the tenant? I am planning to fix my rates and take a massive cut in rent but I feel am still far better off having the asset than having nothing at all. But i respect the people totally who want to pay rent. No problem with that view point at all.
There is a huge shortage of housing and I have put my rents up every six months easily and without a problem and have still being able to afford to replace roofs, boilers and other high ticket maintenance projects that I would otherwise have been unable to do in so called boom times.
Notwithstanding this, I still believe that the UK construction industry generally can bring this country out of recession if there was some way of freeing up capital and forcing the lenders to lend on merit as opposed to some ridiculous "invented" condition dreamt up by the FSA. The sad fact is that there wiill be a whole generation of people who will not be able to afford to buy a home of their own and this will continue until this generation of achievers die and pass on their property or the Govt and FSA comes to its senses.

26 Nov 2010

Quote: Too Hot....."No problem at all that some people are non aspirational"
what a totally condesending comment. So just because someone does not want to own some bricks and mortar they are non aspirational people !!!!! People who choose to rent maybe can aspire to different values to you. You say you take advantage and increase your rents year on year !! Yea....well maybe as already stated if we built more affordable rented, council accommadation, ...private landlords would have to think again about their rent and would not be able to increase their income by more and more each year !!

26 Nov 2010

Quote by tweeky
Lost, once you handed back the keys to any property you owned what was to stop you going bankrupt? Probably would have been an easier way out of the situation and by now you would be in a far better position.
Just a thought

at the time it was about £250 to declare bankruptcy which I didn't have and couldn't get and was too proud to ask anyone for. If i'd been unemployed I think the state would of payed almost half of it but i wasn't so it was the whole amount. add this too my stupid sense of morality. By the time I was in a position to consider it i'd been paying bits off here and there and was advised by a an IFA that I'd probably, because i'd been managing and no matter that I was living in a rat infested caravan near Launceston helping build the A303 working an average 9 day week (72 hour week, that bankruptcy would be denied.
Needless to say when it happened to a mate of mine whose wife ran up debts of over 20k on catalogues and 10k on cards in the early noughties I talked with him into bankruptcy and two years later he was debt free working and things were and are on the up for him.
In being bitter at the time I can honestly say that I've never been so content as i have been over the last 15 years. Thats more to do with J and kids and maybe a sense of purpose. Just a shame they've had the burden of some hard times due to stuff that went on previous to knowing/having them.
My advice for many in real shit is too lok at bankruptcy though. I'ts an amazing thing to see one day a guy walking around with too much on his plate then the next after bankruptcy the sheer sense of relief in the same face with the knowledge that the worry is over.

26 Nov 2010

Quote by deancannock
Quote: Too Hot....."No problem at all that some people are non aspirational"
what a totally condescension comment. So just because someone does not want to own some bricks and mortar they are non aspirational people !!!!! People who choose to rent maybe can aspire to different values to you. You say you take advantage and increase your rents year on year !! Yea....well maybe as already stated if we built more affordable rented, council accommodation, ...private landlords would have to think again about their rent and would not be able to increase their income by more and more each year !!

Though I'm not on Too-Hots wavelength a lot of the time and we're on different sides of the political fence on a lot of issues, which is healthy, I don't think there is any condescension in the context of what he said. I also believe that his points about constructing our way out of recession are quite valid and hold merit. Britain has always either built its way out of trouble or gone to war then built its way out of trouble. either or.
The fact that I would say too Hot was profiteering from his ability to increase rents year on year and he would call it good old business practice within a capitalist state is another argument which is for other threads. His point holds water Britain can build its way out of trouble but at some point there has to be a fundamental change in the way Britain relies on construction, rather than production, to find lasting more stable economic solutions.

27 Nov 2010

Quote by deancannock
Quote: Too Hot....."No problem at all that some people are non aspirational"
what a totally condesending comment. So just because someone does not want to own some bricks and mortar they are non aspirational people !!!!! People who choose to rent maybe can aspire to different values to you. You say you take advantage and increase your rents year on year !! Yea....well maybe as already stated if we built more affordable rented, council accommadation, ...private landlords would have to think again about their rent and would not be able to increase their income by more and more each year !!

Hi Dean, don't know if you have noticed but there are masses of tweny and thirtysomethings all over western europe now who originated in Eastern Europe. They are the children of the generation that endured true socialism from 1945-1986 and their parents have encouraged and motivated them to work hard and achieve more. They "allegedly" stole the jobs from the indiginous work force in the UK and W. Europe because they were prepared to work harder for less money and accept that progressing in life meant starting at the bottom and fighting their way up.
This particular web site is a reflection of everything that is wrong with complacent Britain and your posting above encapsulates it perfectly. You sense and injustice, but rather than fight to raise yourself above it you would rather the State bring everyone else down to your level.
There is a true middle class of former Eastern Europeans in this country now and they have followed in the same footsteps as the Asians before them. They have worked hard, invested their money wisely and built their businesses and their lives whilst so many around them complained about everything and particularly how unlucky they were whilst the immigrants had such a good deal. Many of those immigrants are now high net worth individuals with big property potfolios and they have achieved this by working hard - an Asian Client of mine started working in his Uncles shop in 1991 and worked 90 hours a week saving like crazy and started buying houses in 1993 and currently has a portfolio of 106 UK buy to let properties which earn him £300,000 a year at the moment through rent/mortgage differentials.
It is not wrong to be aspirational, it is good. It is not wrong to aspire to own property to try to sort your own future pension arrangements out - because the government certainly ain't helping.
I think you are going through a bad time Dean having been made redundant and you want to blame someone, or something. This is understandable but you can get yourself out of the situation by rising above it and not hoping or trying to bring others down because they have aspirations for wealth and success and/or property ownership.
My original comments on the thread were about the Construction Industry and all associated trades having the ability to get the country out of recession. France is proving on an on going basis that with imaginative tax propositions such as Loi Scellier (Capital Allowances for individuals investing in new build, managed schemes) and a willing yet conservative banking system that construction can achieve a utopia:
1) Put pension planning in the hands of the individual
2) Keep the property market buoyant
3) Maintaining economic progress through construction
There is a fear in the country of greed through property speculation but this can easily be controlled by CGT and is really a non issue which in effect could be a significant revenue earner.

27 Nov 2010

Quote by Too Hot
There is a fear in the country of greed through property speculation but this can easily be controlled by CGT and is really a non issue which in effect could be a significant revenue earner.

I could not agree more with this sentiment. Until the underlying belief changes to the French model that a house is home not an investment, the fear of greed will continue to suppress the marketplace.

27 Nov 2010

Quote by gulsonroad30664
i'm sorry to inform you all that unless the creation of credit (money) is in the hands of a government of the people, by the people, for the people, while it is in the hands of private banks (the private bank of england company limited), there is no other solution to the contrived deliberate debt crisis that is intended to us all of our wealth and impoverish us all into serfdom. those of us who survive that is.
i ask again, if the existing government of the u.k. can instruct the bank of england to print money, then who the fuck do we owe it to ?

There is no actual money printed guls; how many times do so many people have to tell you this?

27 Nov 2010

Quote by GnV
i'm sorry to inform you all that unless the creation of credit (money) is in the hands of a government of the people, by the people, for the people, while it is in the hands of private banks (the private bank of england company limited), there is no other solution to the contrived deliberate debt crisis that is intended to us all of our wealth and impoverish us all into serfdom. those of us who survive that is.
i ask again, if the existing government of the u.k. can instruct the bank of england to print money, then who the fuck do we owe it to ?

There is no actual money printed guls; how many times do so many people have to tell you this?
I think Gulson's point is that the Govt is magicking up imaginary money, not that they are physically printing pieces of paper with none-photo-copyable inks? confused

These pieces of paper may not actually physically exist out here in the real world, but they seemingly have a little electronic existence every bit as buyable and spendable as the real thing, and I think you'll find that these magicked-out-of-thin-air imaginary pounds have to be paid back out of your wages? ((( Not yours specifically, obviously, cos you're in France and work in Euros, but you take my point? )))
N x x x ;)

28 Nov 2010

Quote by Too Hot
Quote: Too Hot....."No problem at all that some people are non aspirational"
what a totally condesending comment. So just because someone does not want to own some bricks and mortar they are non aspirational people !!!!! People who choose to rent maybe can aspire to different values to you. You say you take advantage and increase your rents year on year !! Yea....well maybe as already stated if we built more affordable rented, council accommadation, ...private landlords would have to think again about their rent and would not be able to increase their income by more and more each year !!

Hi Dean, don't know if you have noticed but there are masses of tweny and thirtysomethings all over western europe now who originated in Eastern Europe. They are the children of the generation that endured true socialism from 1945-1986 and their parents have encouraged and motivated them to work hard and achieve more. They "allegedly" stole the jobs from the indiginous work force in the UK and W. Europe because they were prepared to work harder for less money and accept that progressing in life meant starting at the bottom and fighting their way up.
This particular web site is a reflection of everything that is wrong with complacent Britain and your posting above encapsulates it perfectly. You sense and injustice, but rather than fight to raise yourself above it you would rather the State bring everyone else down to your level.
There is a true middle class of former Eastern Europeans in this country now and they have followed in the same footsteps as the Asians before them. They have worked hard, invested their money wisely and built their businesses and their lives whilst so many around them complained about everything and particularly how unlucky they were whilst the immigrants had such a good deal. Many of those immigrants are now high net worth individuals with big property potfolios and they have achieved this by working hard - an Asian Client of mine started working in his Uncles shop in 1991 and worked 90 hours a week saving like crazy and started buying houses in 1993 and currently has a portfolio of 106 UK buy to let properties which earn him £300,000 a year at the moment through rent/mortgage differentials.
It is not wrong to be aspirational, it is good. It is not wrong to aspire to own property to try to sort your own future pension arrangements out - because the government certainly ain't helping.
I think you are going through a bad time Dean having been made redundant and you want to blame someone, or something. This is understandable but you can get yourself out of the situation by rising above it and not hoping or trying to bring others down because they have aspirations for wealth and success and/or property ownership.
My original comments on the thread were about the Construction Industry and all associated trades having the ability to get the country out of recession. France is proving on an on going basis that with imaginative tax propositions such as Loi Scellier (Capital Allowances for individuals investing in new build, managed schemes) and a willing yet conservative banking system that construction can achieve a utopia:
1) Put pension planning in the hands of the individual
2) Keep the property market buoyant
3) Maintaining economic progress through construction
There is a fear in the country of greed through property speculation but this can easily be controlled by CGT and is really a non issue which in effect could be a significant revenue earner.
ffs...how patronising can you get !! Actually to the point of being offensive !! You know nothing of me and my life. I have worked since the age of 18 leaving college, I have twice run my own company, and right now for the first time ( as stated by the company involved, as a direct result of geovernment policy) I have been made redundant. I have now started up my own company again, for the moment. I do own my own property. However I do not call people who do not wish to own there own houses non-aspirational. You obviousily think to ne aspirational you must have money and materialisitic things. Some of us aspire higher than that. Happiness and contentment has no price on its head.