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    (Original post by benjiiiiiiiii)
    Priced Out are well meaning, but are completely clueless about the economics of affordability issues.

    It's not selling prices that are the most important factor. It's discretionary incomes that really determine whether thing are affordable or not.

    Even is prices were the most important issue, a 100% LVT would bring selling prices down by two thirds.

    Has Priced Out even considered or done the maths on this? No they haven't.
    Yes they have.

    The solution you mention would mean the crashing of banks as people purposefully default on their mortgages as the home is worth so much less.

    Zero percent inflation is the only method that works without messing things up.

    It doesn't make a huge initial impact but it does over a decade or more.


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    (Original post by paul514)
    Yes they have.

    The solution you mention would mean the crashing of banks as people purposefully default on their mortgages as the home is worth so much less.

    Zero percent inflation is the only method that works without messing things up.

    It doesn't make a huge initial impact but it does over a decade or more.


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    Why would people purposely default just because they are in negative equity? They didn't in the 90s, it would make no sense.

    The only people who would be really troubled by negative equity are those who due to a loss of income cannot keep up the mortgage repayments.

    However, given those people are almost overwhelmingly likely to be working households, their tax liabilities under a shift to LVT would be reduced by around £11K a year, mitigating much loss of income due to a change of employment. It also also means those in negative equity would be back in the black in less than seven years and able to pay off the balance in half the time.

    http://kaalvtn.blogspot.co.uk/2013/0...capital.html#3

    Nevertheless, even though negative equity is more of a problem psychologically than financially, there are steps we can take.

    Like extending compulsory payment insurance from 20% to 50% equity.

    Or we can simply write off negative equity off. Which would probably be the best idea in the long run.

    "Even allowing house prices to fall by fifty per cent and writing off all the unsecured amounts would only "cost" 0.5 x 0.5 = 0.25 x £1,200 billion = £300 billion. The reduction in the cost of the subsidy would be £80,0000 x 24 million = £1,920 billion, which is an overall saving to future purchasers of £1,620 billion."

    http://markwadsworth.blogspot.co.uk/...ty-square.html

    For sure the banks wouldn't like this revenue stream taken away from them, even if they were compensated by £300bn. So what? By making profits by mostly lending on land values (80% of bank lending is immovable property), they are economic parasites. The quicker we brush them off, the better for our economy, and those who will buy property in the future at less than half what it costs now.
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    (Original post by Studentus-anonymous)
    This.

    The four biggest issues though is the physical lack of housing, NIMBYism with all the groups and laws it brings, foreign/absentee owners who buy up the property as wealth assets while jacking up the property prices to extortionate levels, which renders large swathes of our cities and 'nice' rural locations off limits to everyone else & the governments total lack of interest or action on the matter.

    Everyone else has to give up home ownership, and throw themselves at the mercy of the predatory rental market, where it's a landlords world right now (more than usual).
    We don't have a physical lack of housing.

    http://capx.co/there-is-no-uk-housin...never-was-one/
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    (Original post by benjiiiiiiiii)
    Why would people purposely default just because they are in negative equity? They didn't in the 90s, it would make no sense.

    The only people who would be really troubled by negative equity are those who due to a loss of income cannot keep up the mortgage repayments.

    However, given those people are almost overwhelmingly likely to be working households, their tax liabilities under a shift to LVT would be reduced by around £11K a year, mitigating much loss of income due to a change of employment. It also also means those in negative equity would be back in the black in less than seven years and able to pay off the balance in half the time.

    http://kaalvtn.blogspot.co.uk/2013/0...capital.html#3

    Nevertheless, even though negative equity is more of a problem psychologically than financially, there are steps we can take.

    Like extending compulsory payment insurance from 20% to 50% equity.

    Or we can simply write off negative equity off. Which would probably be the best idea in the long run.

    "Even allowing house prices to fall by fifty per cent and writing off all the unsecured amounts would only "cost" 0.5 x 0.5 = 0.25 x £1,200 billion = £300 billion. The reduction in the cost of the subsidy would be £80,0000 x 24 million = £1,920 billion, which is an overall saving to future purchasers of £1,620 billion."

    http://markwadsworth.blogspot.co.uk/...ty-square.html

    For sure the banks wouldn't like this revenue stream taken away from them, even if they were compensated by £300bn. So what? By making profits by mostly lending on land values (80% of bank lending is immovable property), they are economic parasites. The quicker we brush them off, the better for our economy, and those who will buy property in the future at less than half what it costs now.
    If the price of a house drops in half they won't carry on paying the mortgage with such a huge negative equity


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    (Original post by benjiiiiiiiii)
    We don't have a physical lack of housing.

    http://capx.co/there-is-no-uk-housin...never-was-one/
    That article is one of the stupidest things I have read in a while


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    (Original post by paul514)
    If the price of a house drops in half they won't carry on paying the mortgage with such a huge negative equity


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    If they didn't, they'd either be homeless, paying more for the same type of property in the private rented sector, become council tenants.

    Any of which they could do now in order to avoid paying such a large mortgage. But they don't do they?

    As I said, in the 90s, millions were in negative equity. The ones handing the keys back in couldn't keep up the payments because of lower income/job loss.

    That doesn't need to happen either, as there are plenty of options, like mortgage write offs, as per the link in previous post.
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    (Original post by paul514)
    That article is one of the stupidest things I have read in a while


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    I'm not entirely surprised by that revelation. Perhaps you should write the man an e-mail pointing out just how stupid he is. I'm sure he'll take your advise very seriously
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    (Original post by Rover73)
    DEAR PRIME MINISTER,YOU MUST KNOW HOW EASY IT WOULD ACTUALLY BE TO SOLVE THE HOUSING CRISIS, SO WHY DONT YOU?

    "Solving the land question means the solving of all social questions… Possession of land by people who do not use it is immoral - just like the possession of slaves."- Leo Tolstoy

    If you are serious about helping the people, Introduce a Land Value Tax.

    Firstly;"Stop to consider how the so-called owners of the land got hold of it. They simply seized it by force, afterwards hiring lawyers to provide them with title-deeds. In the case of the enclosure of the common lands, which was going on from about 1600 to 1850, the land-grabbers did not even have the excuse of being foreign conquerors; they were quite frankly taking the heritage of their own countrymen, upon no sort of pretext except that they had the power to do so." – George Orwell.

    "Except for the few surviving commons, the high roads, the lands of the National Trust, a certain number of parks, and the sea shore below high-tide mark, every square inch of England is `owned' by a few thousand families. These people are just about as useful as so many tapeworms. It is desirable that people should own their own dwelling houses, and it is probably desirable that a farmer should own as much land as he can actually farm." – George Orwell.

    Who are the biggest benefactors of this artificial land shortage?

    a) Primarily Large Landowners. The ludicrously small figure of 0.65% of the UK population own 68.3% of the land, many are aristocratic families dating back many hundreds of years. Despite propaganda stating that the British aristocracy is poverty stricken and exists no more, they have managed to hang on to their lucrative acres very well, and in many cases expand their empires. The root of this situation came about from the Norman conquest. The Normans gave land to people who were favorable to them. In short, many of these families were traitors to their own kind conspiring with invaders. The Saxons had a very different approach to land, its ownership and usage. However, the Feudal system imposed by the Normans meant 100% of taxes came from the land, and not from any income tax. The land owners, mainly Lords, moved taxes away from land to increase their wealth, moving taxation onto individuals. Later, the enclosures of common lands and the Highland croft clearances completed the land rout with these people greedily stealing land. The situation has never been rectified. The UK still has this landowning aristocratic legacy, which still, despite propaganda stating otherwise, has a large effect and influence on the British population. Large landowners are part of the British establishment and do everything in their power to keep the status quo. The late Enoch Powel described the British establishment as “the power that need not speak its name”.
    A very astute description.Most of these landowners produce little making their vast profits by taking rent. When the media reports that times are hard for farmers, they omit the word “tenant”.
    It should be “tenant farmers”.
    When times are bad the landowner always gets his rent, or takes the farm back, paying no taxes on it when idle, and leaves it until times are better. To justify their monopolies in land ownership, large landowners state they are only custodians of the land and only they can maintain the land properly. “Maintaining the land properly” is rather open and vague, if they ever do such a thing of course.

    Their excuse to grab land intially, in the English enclosures and Highland Clearances, was to improve and mainatin land. If these people are only custodians and looking after the land for our benefit, then why aren’t the public allowed on uncultivated land? These custodians fence off all their lands and only allow access to the population when forced to by law. Their claims clearly do not hold water.

    The British prime minister in 1909 stated about British landowners hoarding land and their so-called maintenance and productivity of land:

    "Millions of acres ... more stripped and sterile than they were, and providing a living for fewer people than they did 1000 years ago - acres which abroad would either be clad in profitable trees or be brought ... to a higher state of cultivation."- Lloyd George

    The UK has never had a revolution, which tend to strip away the vested interests of the entrenched landowning rich. No political party has had the stomach to face up to large landowners, who are a legacy of our totally unjust past. Landed families infiltrate the top brass of the military. In the 1960s and 1970s, there were two planned military coups against the reforming Wilson government as many in the British establishment thought, amongst other things, he would nationalise land. However, there was full employment, a sound economy and the population were not discontent, only aspects of the British Establishment were. After all, in 1945 Atlee promised land reform, but ran out of time, so Wilson, a major part of the Atlee government, should carry out the promise when the Labour party returned to power, which he mysteriously never did.
    Tony Blair ejected from the House of Lords 66 hereditary peers, who between them owned the equivalent of 4.5 average sized English counties. The Royal family controls approximate the size of one average sized English county. The Duke of Argyle owns vast tracts of Scotland. Historically landowners have been a problem; the Irish famine was a direct result of large landowners. The problem is still with us and in many respects even greater. With large landowners being omnipresent in the Palace of Westminster, land reform would always be difficult if near impossible. Tony Blair ejecting hereditary peers is the first step in land reform, as one barrier has been partially dismantled.

    What creates this artificial land shortage?

    The 1947 Town and Country Planning act, introduced by a “Labour” government, who promised land nationalisation during the 1945 general election, herds the population into small isolated highly dense pockets of land in urban areas. Amazingly the Labour government allowed the Council for the Protection of Rural England (CPRE) to be involved in drafting the act. CPRE was formed by large landowners. They influenced the act to suit themselves. The naïve Labour administration at the time accepted their input. Over 90% of the population now live in urbanised areas, the second highest percentage in Europe, leaving the countryside virtually empty, because of this draconian act. This crams near 55 million of the population into around 7% of the land, which is only 4.2 million acres out of a UK total of 60 million acres. 60 million people own just 6% of the land.

    The pitiful lack of land for new housing is not helped by the 30 million acres that have ‘disappeared’. [The land Registry still does not know who owns up to 50% of the UK]- Peter Snow (referring to the Land Registry & Planning)

    The act prevents us from building on the countryside, even though much of it is being paid to remain idle by taxpayers money. A countryside that has lost its population at an alarming rate over the past 30 years. The population of the UK are forced into tight urban pockets paying extortionate prices for land, and subsequently houses. Their taxes are used to reinforce this bizarre situation by paying to:Keep land unused to maintain an artificial land shortage inflating house prices.House large sections of the population unnecessarily in public funded housing. Overwhelmingly control where the population lives. This adds insult to injury. A contemptuous slap in the face.The Town & Country Planning act is in effect an act to control the population, rather than ensure adequate agricultural land is available, protect areas of natural beauty or promote first class habitation. The latter it certainly does not do.


    INTRODUCE A LAND VALUE TAX AS FIRST PROPOSED BY WINSTON CHURCHILL, AND LLOYD GEORGE IN HIS PEOPLES BUDGET OF 1909

    Worth also noting that Churchill was an advocate of LVT. Of course the Tories always omit that from any of their references to Churchill.

    'Roads are made, streets are made, services are improved, electric light turns night into day, water is brought from reservoirs a hundred miles off in the mountains -- and all the while the landlord sits still. Every one of those improvements is effected by the labor and cost of other people and the taxpayers. To not one of those improvements does the land monopolist, as a land monopolist, contribute, and yet by every one of them the value of his land is enhanced. He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived.

    "http://www.landvaluetax.org/current-affairs-comment/winston-churchill-said-it-all-better-then-we-can.html

    SINCERELY DAVID *****


    Please copy and paste and send to the PM if you agree:

    [email protected]
    Nice quotes . I've read a great many books by Orwell and Tolstoy and I've absolutely enjoyed them, especially 1984 by the former and Anna Karenina by the latter.
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    (Original post by benjiiiiiiiii)
    If they didn't, they'd either be homeless, paying more for the same type of property in the private rented sector, become council tenants.

    Any of which they could do now in order to avoid paying such a large mortgage. But they don't do they?

    As I said, in the 90s, millions were in negative equity. The ones handing the keys back in couldn't keep up the payments because of lower income/job loss.

    That doesn't need to happen either, as there are plenty of options, like mortgage write offs, as per the link in previous post.
    If they didn't they could move out and rent for a cheaper price than their mortgage after all everything is now half price.

    Negative equity in the early 90's was extremely minor compared to what you are talking to


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    (Original post by benjiiiiiiiii)
    I'm not entirely surprised by that revelation. Perhaps you should write the man an e-mail pointing out just how stupid he is. I'm sure he'll take your advise very seriously
    I wouldn't bother it was a joke of an article criticising official estimated figures with another set of official estimated figures.....

    Then goes on to say all that matters is if someone has a roof regardless of cost and ownership.

    It was full retard


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    (Original post by paul514)
    If they didn't they could move out and rent for a cheaper price than their mortgage after all everything is now half price.

    Negative equity in the early 90's was extremely minor compared to what you are talking to


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    You can phase in LVT to be as gentle as you wish. I used to think that would be the only approach, say 20 years. We've had it drummed into us house prices must rise, and negative equity is worse than the plague. This is all brainwashing and doesn't stand up to a rigorous cost/benefit analysis.

    Under LVT rents wouldn't go down. In fact they'd go up. Not nearly as fast as the discretionary incomes of renters freed from paying onerous income and sales taxes, but up they would go. Good, as it increases aggregate rental values so we could get on with scrapping as many other damaging taxes as possible.

    In Denmark, after introducing a partial LVT , because the economy did so well, house prices actually went up.

    Unless we only introduced a 100% LVT at £200bn, without cutting any other taxes, would I expect an overnight plummet. Used to replace other taxes (revenue neutral) it would take 2-3 parliaments for them to drop by over 50%.

    90s negative equity was not "minor", not that it matters. It was enough to illustrate the point. Only those who couldn't keep up the repayments got into difficulties and handed in the keys.
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    (Original post by paul514)
    I wouldn't bother it was a joke of an article criticising official estimated figures with another set of official estimated figures.....

    Then goes on to say all that matters is if someone has a roof regardless of cost and ownership.

    It was full retard


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    No, he was simply pointing out that the excepted orthodoxy is based on faulty statistics ie that housing supply has not kept up with household formation. It has in fact outstripped it.

    I agree his analysis that therefore everything is therefore ok, is somewhat trite. Funnily enough, he probably knows it, but won't delve any deeper. That would not only make him unpopular, by he'd be shunned by his colleagues and fellow Tories. Instead he is one the very best examples of being in denial I've ever seen.

    Here one he did earlier on the very subject of the OP. Enjoy.

    http://www.conservativehome.com/thec...-own-land.html
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    (Original post by benjiiiiiiiii)
    You can phase in LVT to be as gentle as you wish. I used to think that would be the only approach, say 20 years. We've had it drummed into us house prices must rise, and negative equity is worse than the plague. This is all brainwashing and doesn't stand up to a rigorous cost/benefit analysis.

    Under LVT rents wouldn't go down. In fact they'd go up. Not nearly as fast as the discretionary incomes of renters freed from paying onerous income and sales taxes, but up they would go. Good, as it increases aggregate rental values so we could get on with scrapping as many other damaging taxes as possible.

    In Denmark, after introducing a partial LVT , because the economy did so well, house prices actually went up.

    Unless we only introduced a 100% LVT at £200bn, without cutting any other taxes, would I expect an overnight plummet. Used to replace other taxes (revenue neutral) it would take 2-3 parliaments for them to drop by over 50%.

    90s negative equity was not "minor", not that it matters. It was enough to illustrate the point. Only those who couldn't keep up the repayments got into difficulties and handed in the keys.
    It was minor I lived through it the main problem was mortgage rates.

    If we are talking about zero % inflation over three parliaments that makes a house 50% more affordable assuming a rough 3% a year raise in wages per year


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    (Original post by benjiiiiiiiii)
    No, he was simply pointing out that the excepted orthodoxy is based on faulty statistics ie that housing supply has not kept up with household formation. It has in fact outstripped it.

    I agree his analysis that therefore everything is therefore ok, is somewhat trite. Funnily enough, he probably knows it, but won't delve any deeper. That would not only make him unpopular, by he'd be shunned by his colleagues and fellow Tories. Instead he is one the very best examples of being in denial I've ever seen.

    Here one he did earlier on the very subject of the OP. Enjoy.

    http://www.conservativehome.com/thec...-own-land.html
    Yea but he did it using another set of stats which are also estimates.

    Regardless it is a persons right to own their own home for someone on an average income.

    When my parents brought their home in the 70's it was accepted logic that only a third of your income should be spent on household bills and he mortgage combined.

    That is much lower than today's share and today's share is largely based on two incomes rather than largely being based on one income back then.

    It's a disgrace to go from that situation to today's and it is terrible for the economy.

    Think how much more stuff people would buy with that spare money, how much tax would be raised from that and how much easier life would be.

    All fixed by one policy


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    (Original post by paul514)
    Yea but he did it using another set of stats which are also estimates.

    Regardless it is a persons right to own their own home for someone on an average income.

    When my parents brought their home in the 70's it was accepted logic that only a third of your income should be spent on household bills and he mortgage combined.

    That is much lower than today's share and today's share is largely based on two incomes rather than largely being based on one income back then.

    It's a disgrace to go from that situation to today's and it is terrible for the economy.

    Think how much more stuff people would buy with that spare money, how much tax would be raised from that and how much easier life would be.

    All fixed by one policy


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    The reason an ever greater share of GDP and wages goes on housing (location really) was first described by David Ricarrdo in his Law of Rent.

    https://en.wikipedia.org/wiki/Law_of_rent

    High land values are a good thing, as they are derived from the efficient exploitation of agglomeration effects on one hand, and a preference for locational amenity of spending on alternative goods and services.

    It only goes bad when these values are capitalised into rents/selling prices and not shared equally.


    http://markwadsworth.blogspot.co.uk/...-planning.html
 
 
 
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