Monday 10 July 2017

Fun Online Polls: A house price crash; Charlie Gard

The results to last week's Fun Online Poll were as follows:

How would you feel if house prices fell by a third?

Pleased for the many "priced out" who can now afford to buy their own home - 88%
Angry that my "wealth" has been diminished - 12%


A good turnout with 97 votes, thanks to the other 8 people who retweeted and the 2 who posted on FB.

I was with the majority on this. Top comment:

The Cowboy Online: Another vote for 'Pleased'; it wouldn't be great for me personally, I would be stuck with negative equity, but I wouldn't lose my home and it would mean others would be able to get one.

Negative equity is a bugger for those owner-occupiers stuck with it, but if the house price fall were expected to be permanent or long term, it only seems fair to write down mortgages to the new lower selling prices. It was the banks who pushed up house prices and mortgage to silly levels and they ought to take the losses on the chin. BTL landlords can whistle for it though, they're supposed to be in it for the long term, and if they can't sell, so what?

The Homeys always use "the danger of nequity" as an argument against anything that would push house prices down. What it boils down to is bank propaganda: we'd rather keep creating mortgages of £200,000 each than have to write down some of our mortgage book and only be able to create mortgages of £150,000. Future buyers are being sacrificed, ostensibly in order to protect some recent purchasers, but actually to protect the banks.
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This whole Charlie Gard story is none of my business and as politicians like to say, "I can't comment on individual cases", but isn't that the whole point? This sort of thing is not the job of government-appointed arbitrators; and if politicians aren't prepared to face up to the individual consequences of laws they impose, isn't that copping out? That said, the NHS has to operate some sort of cost-benefit analysis, and if the NHS decides not to fund his further treatment, I've no problems with that.

So that's this week's Online Poll (no Fun, this week).

"If it were up to you, would you allow Charlie Gard's parents to take him to the USA for treatment?"

Vote here or use the widget in the sidebar.

5 comments:

knirirr said...

...it only seems fair to write down mortgages to the new lower selling prices. It was the banks who pushed up house prices and mortgage to silly levels and they ought to take the losses on the chin.

Do you think that particularly likely? I'd expect banks to screw anyone over who found themselves in that position (which would include me).

Mark Wadsworth said...

K, I doubt they'd do it voluntarily. That's why we have governments who can tell them to do it.

knirirr said...

Indeed, though I'm not convinced that a government would do that either. If I may ask, do you know of any particular reason that they might?

L fairfax said...

"Negative equity is a bugger for those owner-occupiers stuck with it, but if the house price fall were expected to be permanent or long term, it only seems fair to write down mortgages to the new lower selling prices."
You might think that would banks more responsible but sadly in the US where you can abandon your home if you are in negative equity and leave the bank with the problem the banks are not more responsible.
Saying that I like it a lot.

DBC Reed said...

That's the virtue of the Sentinel Tax form of LVT (which I invented by copying out John Stuart Mill's idea for LVT and giving it a silly name).Nobody's house goes down in value, they are frozen in time and edge down to a reasonable level when people realise that buying houses is no longer guaranteed to show a ridiculous profit (on the land value). Science fiction Economics? Mill thought it up in 1871 before George stole the idea and ,I am beginning to think, fucked it up.
(George was no gentleman with the greater man over the question of the Chinese in California over which George came all over UKIP: Mill thought they'd integrate, no problem.)
With any luck, the Sentinel Tax would be followed by an outbreak of inactivity.