Friday, March 30, 2007

Leaseholders Stabbed in The Back

RTB Leaseholders are the product of single most successful policy of the Thatcher years; Right to Buy (RTB). This created 4 million new homeowners who are natural Tory voters; 10,000 of those live in Islington, figure around 20,000 voters on an average of two voters per household.

This Government has savagely attacked RTB and in response to pressure from extreme left elements within their own party slashed the RTB discount to a paltry £16K (down from a full 65% in the Tory years). The result?

An obvious collapse in the number of RTB property sales leading to the first fall in home ownership in 68 years. See

http://www.dailymail.co.uk/pages/live/articles/news/news.html?in_article_id=444799&in_page_id=1770

This Government’s pathetic effects to replace RTB with incomprehensible and ill thought out “Social Homebuy” options have been an expensive waste of time and money. See

http://www.insidehousing.co.uk/news/article/?id=1448830


Are you listening Tory Big Wigs !!!

Back the extension of the £10,000 recharge cap to cover the 8500 HfI leaseholders (and not just the 1500 PFI street property leaseholders - who are already capped thanks to this Tory legislation)

This will be good for the Tory mayoral campaign and good for the leaseholders cause. They are organised and they are angry , they can make a difference

17 comments:

Ed said...

£10,000! The recharge cap should be a lot less than that to encourage councils to spend leaseholders' money efficiently. My freeholder (Lambeth Council) recently spent £4,000 per flat on new windows. The windows are lovely but cheaper ones would have sufficed.

The RTB should be extended to most subsidised housing, and the discount should be increased. I see no reason why a one off "gift" to long-term council tenants is not A Good Thing.

electro-kevin said...

As you know, N, I am not at all sure that the apparent UK fixation with property ownership is a good thing. The sell-off of council housing was a wiley bit of gerrymandering by Thatch which was to provide a secure Tory bedrock and to quell the UK workers' predilection for strike action.

It's turned into a national obsession now and has certainly produced a population willing to work long hours and put up with crap public services.

Why are the French so chic and so smug ? (Why are their railways sooo sexy ?) Possibly because so many of them are able to rent cheaply and live life instead ?


(I'll leave it to someone else to discuss demographics)

Ed said...

The reason that we are fixated on home ownership is that we all want to be homeowners!

What is the disadvantage of owning your own home (apart from the upfront cost)?

electro-kevin said...

The disadvantages of wanting to own your home are many:

- maintenance costs
- difficulty in moving
- insurances
- it can be taken off you if you default
- the government steals nearly half of it when you die...

People want to own a home because:

- they don't like the idea of paying someone else
- they feel they are missing out on investment.
- they can make their own mark on a home they own ...

All these (pro and con)are merely among other reasons of course.

I agree that the way our country is set up you need to get on the property ladder, though right now I would urge people starting out to consider that we are most likely at top-end (seek expert opinion).

Let's remember that this system of home ownership has forced mothers to go back to work contributing to marital pressures (divorce) and the farming out of children to 'professional' care(delinquency - upsurge in use of Ritalin).

Let's also remember that home ownership has caused people to take out record levels of debt on a notional and unrealised value of their property, which we must remember can rise and fall. This has caused a trade imballance where people have spent money they don't have on imports based on equity that is, for the most part, illusory.

WORST of all - positive equity (so called) has anaesthatised vast swathes of the population with 'feel good' whilst the country is, in reality, being turned third world - look around you. I posit that this Government has got away with murder (quite literally)on the back of the housing 'boom'.

Without the property 'boom' people would have been on the streets by now, campaigning exactly as they should have been.

Ed said...

EK

Agree with some of that. The upsurge in house prices is a result of our defunct planning system, which is not a reason to keep renting!

It's expensive to get onto the ladder but once on as long as you're sensible you will own your own home in 25 years. Then it's basically irrelevant how much it is "worth". And then you can live there rent free in retirement.

electro-kevin said...

Nothing to do with planning, Ed.

How could you possibly 'plan' for the levels of immigration we have endured as well as high rates of divorce ? I thought green belt land was meant to be sacred, alas it isn't. What we have is panic by government in the face of population levels it simply can't control.

I do not disagree with the idea of property ownership per se, but I do shudder at the disparity between what average workers can afford and what they have to pay - this is starting to encroach on the 25 year mortgage you speak of meaning that future generations will be paying banks interest a lot longer to reach the point where they can live rent free. Alas this is not clear profit anyway as parents are more inclined to remortgage in order to finance offspring who can't cope because of this 'boom'. They are also more likely to use equity release schemes to get through old age as living is never 'free' - especially with paltry pensions (compared to France) and especially in view of stealth taxes.

Because of wrecked pensions and the fact that people are dedicating all their financial resources into buying their home actually it WILL matter what its worth when you are forced in dotage to draw on it to put food on the table.

And in the meantime Britain is being turned into a very bland and unpleasant land - in some places culturally fragmented and dangerous too.

Ed said...

That's my point. Government's can't plan effectively so they shouldn't try.

Predict and provide? No thanks, I'll let the market sort it out.

Only it can't because no-one is allowed to develop anything without a huge legal process.

electro-kevin said...

But government's fundamental duty IS to control borders.

Newmania said...

Fascinataing exchange between you two but one fcat is missing which is that orrdinary people are aquiring caapital . This is the the great socila mobilising force and they all know it . That is why they will do anything to get in.

You make some really radical points thought kevin some of which have literally never occurred to me . YOu are wrong to think hat property money isnt real though. It can easily be if you choose as I well know.

mutleythedog said...

Ownership obsession also contributes to work force immobility ...

Ed said...

Only if the transaction costs are high.

EK I wasn't talking about the borders being a free market, I meant that land use should be less interfered with.

electro-kevin said...

I see everything as interlinked, Ed - The Butterfly Effect/synchronicity ?

Newmania - if you liquidise an asset without relinquishing your ownership (ie remortgage) you are taking a gamble on the market sustaining the value of that asset. In material terms you have done nothing tangible and you have taken a purely speculative 'punt' like any other form of gambling. This - if done to excess as I think it presently is - adds to inflation and must surely raise the spectre of negative equity once more.

What I am saying here is that we have an economy which is largely thriving on the 'never-never'.
What say there were a property slump tomorrow ? Unlikely I admit. What would a war with Iran do ?

I've no issue with people remortgaging to invest (this seems a worthy gamble) but remortgaging to go on holidays, buy cars ???

We need CU here !

The Hitch said...

This is theft plain and simple.
I am curently negotiating with one of my mothers leaseholders , why should somebody be able to demand that I sell them a £400,000 flat for £20,000? they new the terms of the lease when they bought it.
OK the lease runs out in 75 years but that is still a valuable asset worth far more than 20 k
Its communism , another reason i didnt vote john major

The Hitch said...

ps
Electro kev that was a great post

electro-kevin said...

Thanks Hitch. I've long been of the opinion that housing is Nu Lab's version of 'industry' - the real version of which they've been killing off with red tape - of course other versions of Nu Lab 'industries' are the sex 'industry', the speed camera 'industry' and now the gambling 'industry'(though GB may have put paid to the last one).

Roger Thornhill said...

mutleythedog said...

Ownership obsession also contributes to work force immobility ...

Only indirectly. Stamp Duty does - a tax on mobility - as does the postcode lottery caused by the paucity of good state schools and healthcare as a result of the State monopoly. In the SE, people drive hours each day around the dreaded M25 and I suspect partly due to the cost of moving and the risk to their kids education and safety.

There is one group far less mobile than the private houseowner - the Council Tenant. How on earth can people move any great distance when a Council Tenant? You cannot blow this off by saying it is because of a lack of State housebuilding, for if it were indeed simple to move due to supply, the State would have to constantly build and manage vast amounts of housing to follow the ebb and flow of employment. It is not only incapable, but it would be a monumental waste of resources.

Rented housing is best provided by either the private rentier market (much loathed by Sociofascists) or better still by trusts such as Peabody Estates, who are also secretly loathed by Sociofascists as they do a far better job than "der caan-ci'w'"

Ron Knee's Rants and Raves said...

"RTB Leaseholders are the product of single most successful policy of the Thatcher years; Right to Buy (RTB). This created 4 million new homeowners who are natural Tory voters;"

Wrong and wrong again; Thatch invented the RTB as a way to get millions of previously happy tenants into the web of having to struggle to pay a mortgage with the fear of losing their homes should they fail to keep up repayments. THEN the bitchbag slowly withdrew all social financial help should these people have trouble with their employment, therefore creating a situation whereby all these people are at the mercy of their employers should they feel "the need" to reduce wages. Even today, people are suffering at the hands of this "biatch". My brother in law has just recently been called in to a meeting where they were told that they must either accept a cut in money or they would employ eastern european labour. In the past he would have told his employer where to go. BUT now he has got on the "houseladder" he has few options; either comply with his employers wishes or become jobless, thus losing the roof over his head which he has strived to make into a little palace.

I must admit that Thatch had her head screwed on leaderwise, but it was purely for her government's gains and NOT for the good of the people.

Now will you be so good as to shoot off over to my blog and say what a lovely picture I took this morning? and then YOU can tell me to eff off. It's your party, you can do what you want to.

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