Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How I won the housing market without trying

theguardian.com

Post reply on HN
Print view View original

71–80 of 116 posts

Re: How I won the housing market without trying

#71

Post by pjc50 »

barrkel wrote: post #69
pjc50 wrote: post #56

Earlier quoted context omitted.

Depends on whether you measure earning potential in pounds or houses. Someone earning £50k in an area of £250k houses is being paid 0.2 houses per annum. If they can get £40k in an area of £100k houses their spending power has gone up not down. If only it weren't so necessary to be physically present for the work.

I tend to measure things in disposable income: how much money I have left over after paying the big bills. And this is a fairly absolute measure, rather than relative to living costs, as I spend much of my disposable income on stuff that costs similar amounts no matter where I live. 50k is a mediocre salary, mind.

50k is a 90th percentile salary for the UK as a whole and competitive for non-London non-senior management software dev jobs.

Re: How I won the housing market without trying

#72

Post by nl »

stana wrote: post #22

Thanks to banking deregulation housing has become an investment commodity. In major cities in Australia at the moment half the purchases are for investment rather than owner-occupier. Government incentives like first-home buyer grants (if you can't save for a deposit) have only lifted the prices and helped vendors. Another one is negative-gearing introduced a couple of decades ago allowing tax deduction for investmen…

I think blaming banking deregulation for making housing an investment is a pretty difficult case to make.

Negative gearing, and the flight to safety by overseas investor do have significant impact though.

I suspect many people who think that governments should act to try to cut prices miss the fact how hugely unpopular this would be with the majority of the population.

Many (most?) people have the majority of their savings tied up in a family house and rely on rising prices as retirement savings. That's worked well for the past 60 years or so, and there is no real structural reason why it needs to stop (in Australia anyway).

Re: How I won the housing market without trying

#73

Post by ltp »

yummyfajitas wrote: post #54
pjc50 wrote: post #51

Earlier quoted context omitted.

He mentioned a list of items, such as Foreign Investment Review Board (who should be in charge of making sure foreign investors only buy new properties) which is apparently a rule that's not being enforced. Lots of the western world is seeing housing bid upwards by capital flight from China.

It's not a banking regulation.

No, but a bank (either local or foreign) has a duty of care to ensure that a loan will not be used to finance an investment that potentially violates local or foreign laws placing said loan at higher risk of default.

Re: How I won the housing market without trying

#74

Post by porker »

barrkel wrote: post #69
pjc50 wrote: post #56

Earlier quoted context omitted.

Depends on whether you measure earning potential in pounds or houses. Someone earning £50k in an area of £250k houses is being paid 0.2 houses per annum. If they can get £40k in an area of £100k houses their spending power has gone up not down. If only it weren't so necessary to be physically present for the work.

I tend to measure things in disposable income: how much money I have left over after paying the big bills. And this is a fairly absolute measure, rather than relative to living costs, as I spend much of my disposable income on stuff that costs similar amounts no matter where I live. 50k is a mediocre salary, mind.

Mediocre salary???? Either you live in the square mile bubble, or you're not British.

£50k is what a senior software developer outside London gets.

Re: How I won the housing market without trying

#75

Post by collyw »

Omniusaspirer wrote: post #52
stana wrote: post #22

Thanks to banking deregulation housing has become an investment commodity. In major cities in Australia at the moment half the purchases are for investment rather than owner-occupier. Government incentives like first-home buyer grants (if you can't save for a deposit) have only lifted the prices and helped vendors. Another one is negative-gearing introduced a couple of decades ago allowing tax deduction for investmen…

It's basically inevitable though that in demand property will rise in price, especially with regulation constraining building height/form factor. Home cost in urban areas is much more about location than it's about any real cost to building the residence. Lots of people buy large houses for very little a few miles out of town where land is abundant and demand is more reasonable. I guess I'm just having trouble really…

>I guess I'm just having trouble really feeling sorry for anyone who decides that living within a select few square miles is worth paying an obscene percentage of their income towards that pursuit.

There have been studies showing a negative correlation between long commute times and happiness.

I don't have a family, so I am happy to pay for a relatively small apartment in the city centre. If I lived in the suburbs I would get a lot more house for my money, but then I would have to spend and extra couple of hours every day commuting.

Re: How I won the housing market without trying

#76

Post by collyw »

easytiger wrote: post #34
yummyfajitas wrote: post #29

Earlier quoted context omitted.

Why would housing not be an investment commodity if banks were more strongly regulated? What specific regulation do you propose that would prevent housing investments?

Communal ownership of all property comrade!

Far too radical an idea for here.

Re: How I won the housing market without trying

#77

Post by nl »

yummyfajitas wrote: post #57
jussij wrote: post #49

Earlier quoted context omitted.

In Australia we have negative gearing . In layman's terms it means you can offset property expenses against your real income. So if you have a big income with a corresponding big tax burden, you can reduce you extra income to purchase a property and by using the expenses of that investment, reduce you net income and hence reduce you net tax burden. So rather than paying the tax man, you end up paying the bank, which…

Negative gearing is not a banking regulation, it's a tax subsidy.

I suspect the parent was replying to the second part of your question: What specific regulation do you propose that would prevent housing investments?.

The parent's response is (presumably): "remove negative gearing".

Re: How I won the housing market without trying

#78

Post by collyw »

deepvibrations wrote: post #43
awjr wrote: post #23

Earlier quoted context omitted.

My mother just recently bought a studio flat in Wales for 31k. Prices are dropping around the country. London prices are forcing people away from living in London. Businesses are moving away. (If you are a young developer, I'd suggest moving to Bristol.)

I second that! Best city in the UK in my opinion- It has an amazing selection of bars, clubs and independent shops, a buzzing music scene and of course a great tech scene with plenty of meetups etc. Compared to London I would say it's much more friendly, you can cycle from one side to the other in under an hour, escape to the countryside or the coast in under an hour and you never feel trapped in a towering concrete…

Almost anywhere in the country is more friendly than London

Re: How I won the housing market without trying

#80

Post by Ntrails »

nl wrote: post #72
stana wrote: post #22

Thanks to banking deregulation housing has become an investment commodity. In major cities in Australia at the moment half the purchases are for investment rather than owner-occupier. Government incentives like first-home buyer grants (if you can't save for a deposit) have only lifted the prices and helped vendors. Another one is negative-gearing introduced a couple of decades ago allowing tax deduction for investmen…

I think blaming banking deregulation for making housing an investment is a pretty difficult case to make. Negative gearing, and the flight to safety by overseas investor do have significant impact though. I suspect many people who think that governments should act to try to cut prices miss the fact how hugely unpopular this would be with the majority of the population. Many (most?) people have the majority of their s…

As long as those same people don't then complain that retirement forces them to leverage against their house to pay for it. But all of them do, because they feel it's their right to retain ownership to pass on through inheritance which of course only worsens the problems of property access.
Post reply on HN