The UK Politics and EU Referendum thread - merged

[TightEnd]

Hold the champagne, renters: Philip Hammond just made the housing crisis worse, again

https://www.newstatesman.com/2017/11/hold-champagne-renters-philip-hammond-just-made-housing-crisis-worse-again

[TightEnd]

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[TightEnd]

The Budget summed up by Janan Ganesh https://www.ft.com/content/7c8e3ef0-cdfa-11e7-b781-794ce08b24dc

[TightEnd]

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[TightEnd]

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[TightEnd]

How Brexit looms over the Irish border: 'It's the Berlin Wall approaching us'

an excellent read of an intractable problem

https://www.theguardian.com/uk-news/2017/nov/22/how-brexit-looms-over-the-irish-border-its-the-berlin-wall-approaching-us?CMP=twt_gu

[Jon MW]

the OBR doesn't agree with the policy

OBR assumes that the stamp duty cut will simply up house prices 1:1 “Thus the main gainers from the policy are people who already own property”

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I guessed the 0.3% estimate meant this. So if a first time buyer saves a £1000 or £2000 on stamp duty the house price will just go up £1000 or £2000(?)

Obviously we haven't got the same access to information as they have but does this really seem likely? are sellers with £250,000 homes really going to decide this means they should set an asking price of £252,500? (for example)

Some commentators have said it'll push the house prices up and others have said it's too trivial to make a difference - I'm pretty sure they can't both be right but I'd be inclined towards the latter.

[AndrewT]

Surely it just means that if two FTBs want a property, they both have an extra few grand to throw at it so will raise the price by bidding each other higher.

[Jon MW]

Surely it just means that if two FTBs want a property, they both have an extra few grand to throw at it so will raise the price by bidding each other higher.

I think that might be what they mean, but the maximum saving is £5000 (and for the majority it will only be half or less of that) - I can't see much room for bidding.

The OBR document said about prices being pushed up because of better LTV available because you can use the saved stamp duty money. But the saved money is so small that might mean you can only need 89% LTV instead of 90% LTV (for example). All the words it says make sense - I'm just confused about how much it really makes sense in the 'real world'.

EDIT: and the extra few grand would raise the house price by what the OBR suggested (0.3%) - but that still comes back to how likely this is to actually happen; I just can't see house prices having that kind of price elasticity.

[vegaslover]

It will just push prices up, although saving 2 grand in the scheme of it doesn't boost ftb's anyway.

At the moment, in the South at least, there is a 'price ceiling' of £250000 on certain properties as stamp goes up at that rate. Now this is just a psychological ceiling as the stamp on say 5-10k more is not much. Having that ceiling raised will just raise house prices in and around the £250k bracket

[doubleup]

Isn't the point that stamp duty is dead money?  A ftb needs say a 10% deposit plus stamp duty, now they only need a 10% deposit which will only be slightly increased if house prices increase.  (Obv slightly increased mortgage payments as well.)

[MintTrav]

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  HM Treasury
 ✔  @hmtreasury 

“We have already invested almost £700m in Brexit preparations and today I am setting aside over the next 2 years a further £3bn” #Budget2017

12:39 PM - Nov 22, 2017

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[TightEnd]

The real price of Brexit is hidden in the Budget small print

https://www.newstatesman.com/politics/economy/2017/11/real-price-brexit-hidden-budget-small-print

[TightEnd]

The mother of all downgrades – the OBR has handed the Chancellor the biggest downgrade to productivity forecasts since its creation in 2010

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[TightEnd]

Weaker productivity outlook reflected in lower pay growth. Annual pay down £1,000. Earnings not forecast to return to 2008 peak until 2025 - an unprecedented 17-year downturn

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