More Home-Owner-Ist propaganda

They slip in their subliminal messages everywhere, for example, in today's Telegraph:

A total of 134,142 people went bankrupt or took out an Individual Voluntary Arrangement (IVA) or Debt Relief Order during the year, according to the Insolvency Service... The figure dwarfed the previous record of 107,288 personal insolvencies set in 2006, with insolvency practitioners estimating this level had already been passed by October last year...

Chris Nutting, director of personal insolvency at KPMG, the accountancy firm, said: “Our research shows that over 223 people a day are choosing to petition for their own bankruptcy. The figures show that there are still many people experiencing serious financial difficulties, despite record low interest rates. While Britain is technically out of recession, the harsh reality is that many people are still living beyond their means. Lessons from history show that personal insolvencies will continue to rise after the recession finally ends and for some time to come."

Ho hum.

1. Ignoring a few people who maxed out on store cards and credit cards (and there will always be a few, tough shit, one man's Premier League club is another woman's wardrobe full of designer shoes), the main reason why people are struggling is because they are lumbered with huge mortgages, and/or because they have lost their jobs (in most cases, through no fault of their own).

2. Now, by and large, the people with the biggest mortgages are those who bought in the last few years when prices were ridiculously high, so they probably bought a much smaller property than they would have done if they'd bought more than fifteen years ago (when housing was, let's be honest, reasonably cheap).

3. Ergo, in material terms, these recent purchasers are not in any way "living the high life", they have been forced to accept a lower standard of living by the incumbents, the Home-Owner-Ists, who by and large have smaller or no mortgages. So the established Home-Owner-Ists can sit their smugly on their paper capital gains and boast about how little debt they have, as opposed to the arrivistes.

4. In their own minds, of course, the recent purchasers saddled with colossal debts are 'responsible borrowers' who wanted to 'invest in bricks and mortar to secure their own future', i.e. suckers who bought into the Home-Owner-Ist dream and who are now being derided as 'reckless borrowers' by the more established Home-Owner-Ists.

5. As to 'record low interest rates', as we well know, you only qualify for these if you have a loan-to-value of only 60% or 75%. The effective rate for the extra borrowings to take you up to 90% loan-to-value or more is above fifteen per cent. This gives the established Home-Owner-Ists all the more reason to be smug.

Disclaimer: "homeowner" is not synonymous with "Hone-Owner-Ist". There's nothing wrong with owning - or wanting to own - your own home, that's our culture.

I use "Home-Owner-Ism" to refer to people who insist that "prices can only go up" (and if they are not going up then the government should do something about it); people who demand that banks treat mortgage borrowers in arrears with kid gloves; the NIMBYs; a lot of buy-to-letters; people who insist that Council Tax should go down and Business Rates are unfair because they 'do not relate to ability to pay'; people who wail on about the hallowed green belt (without actually understanding what it is); people who think that they have earned their paper capital gains on housing; people who think that increasing house prices means increasing wealth; and who think that selling off the council houses was a good idea.