Sad: Rightmove shows increasing number of B&Bs, Bunkhouses etc up for sale

[JoshW]

Up until the 1960s most people expected to live with their parents until they could afford their own place (or qualify for council housing).

Into their 30s? My nan and grandad lived with their parents when they got married at 19, and after first child, but they got a council house in early 20s, and my other side was well off so not sure what age people expected to move out? Of course, on average they also expected to inherit a decade earlier...

Only takes a quick look to see that houses are now 'double' the price they were in the 60s compared to the average wage at the time.

Lack of social housing is an absolute travesty and contributes towards this.

Owning a house is an absolute pipe dream as a single person nowadays for most people my age.

Given "fiscal creep"  (a certain amount money not worth the same as it used to be) the inheritance/gift laws/amounts that were originally intended to redistribute wealth locked up in super rich landed-estates, now apply to inheritance of many ordinary people's estates. Average house price in London is now ?514K and inheritance tax threshold at ?325K. The idea that your house can simply pass to your kids may not work out that way.

Good. Inheritance tax should be higher, and loopholes of trusts should be closed asap (I'd imagine most of the super rich landed estates manage to avoid any inheritance by using these).

If the only thing inherited was the house in London the inheritance tax charge would be ?75,600. ?75k for an average house in London sounds alright to me. And this is if the only thing inherited is the house, other things inherited could easily offset this amount (not to mention any life assurance and pension sums where the lifetime allowance is just over a cool million before being taxed at all - and that's in a registered trust, lots moving to non-registered where it falls outside of the lifetime allowance and is for all intents and purposes not taxable).

 

[sinker]

Either that, or property prices are so high right now, it's a good time to sell up. There's bound to be a crash soon, so buy back again in a couple of years for half the price 

You're  right. Add to that the fact that there are a LOT of people from Cheshire / L'pool / M'cr who could afford to buy a B&B in Betws y Coed, for example, due to the stunning location, and use it as a second home / holiday home / commute 3 days a week / holiday home for friends and extended family. That type of thing.

No wonder that a person, third generation, born and bred in Betws or similar can't even afford a terraced house in their home town.

I'm Welsh and extremely proud of it but I know our faults as a country and greed is one of them; we have brought this upon ourselves by being greedy....inherit a house from you parents or grandparents, don't need it, sell it to the highest bidder. Usually from away or as a second home. Raise the bar. Prices spiral up out of control. We cannot see beyond the end of our noses; national trait.

We also love to run each other down as well. If there was a nuclear war and there was only three Welshmen left alive you would still find two of them in a corner talking about the other one 

 

[Stuart France]

A little history goes a long way toward understanding.  In my lifetime, UK interest rates peaked at 17% in 1979 at the transition from Old Labour to Mrs Thatcher as the incoming government extinguished the 1970s inflation rate they inherited -- which was 18% having peaked at 24% in 1975 and averaging 18% from 1973-80.

Interest rates then settled around 10% for the following decade but with wild swings up to 4% either way until the ERM Sterling Crisis of 1992.  During this period inflation was at first tamed at 5% (give or take 2%) but rose to almost 10% by 1990.  Having given up on pegging the Pound to the assumed eventual Euro, interest rates were allowed to fall to 6% (give or take 2%) until the Banking Crash of 2008 when they fell to 0.5% and have since effectively fallen to zero.  During the decade to 2019 annual CPI inflation averaged 3%.

As to house prices, in broad terms, a house now costing ?250,000 would have cost ?100,000 in today's money (taking account of inflation) in 1975. Salaries, of course, in real terms have not gone up by 2.5 times in the same period.  So what is going on?

The answer is Parkinson's Law, as applied to money.  The original law states that "Work Expands to Fill the Time Available for its Completion".  The money version of this Law is therefore "House Prices Rise to Match the Capacity to Borrow".  In other words there is an inverse relationship between house price inflation and interest rates where average earnings in real terms remain level.

Successive governments have become more and more addicted to high levels of borrowing so as to fund otherwise unaffordable measures to create an impression of increases in living standards so as to improve their re-election prospects.  The debt is now so large that it cannot be repaid on the timescale of whole working lives or generations.

Enter New Monetary Theory (the magic money tree) where it is conveniently claimed that successive governments can print unlimited new money in their own currency with absolutely no consequences.

Those more mathematically literate than governments will realise that as interest rates head for zero then the cost of borrowing money also becomes zero.  Therefore the value of money ultimately becomes zero because it can be created in infinite amounts at no cost and with no consequences.  Except there will be consequences eventually.

The value of fiat money is represented by assets (stocks and shares, businesses, housing stock, savings, infrastructure etc) and the future capacity to create new assets (via work and the economy).

When the time bell is called, bonds will crash first, and then the stock market, and no amount of money printing at zero interest rates will stop it because the market by then will have understood that the new money is as worthless as the old.

So yes, buy a house if you can and inherit one if you can't.  Even if the next financial crisis is a deflationary one as things unwind, the value of your house cannot drop to nothing, unlike your money.

 

[PeteHall]

Given "fiscal creep"  (a certain amount money not worth the same as it used to be) the inheritance/gift laws/amounts that were originally intended to redistribute wealth locked up in super rich landed-estates, now apply to inheritance of many ordinary people's estates. Average house price in London is now ?514K and inheritance tax threshold at ?325K. The idea that your house can simply pass to your kids may not work out that way.

Good. Inheritance tax should be higher, and loopholes of trusts should be closed asap (I'd imagine most of the super rich landed estates manage to avoid any inheritance by using these).

If the only thing inherited was the house in London the inheritance tax charge would be ?75,600. ?75k for an average house in London sounds alright to me. And this is if the only thing inherited is the house, other things inherited could easily offset this amount (not to mention any life assurance and pension sums where the lifetime allowance is just over a cool million before being taxed at all - and that's in a registered trust, lots moving to non-registered where it falls outside of the lifetime allowance and is for all intents and purposes not taxable).

The tax free allowance for inheritance is ?325k per person, so in a typical family scenario of a married couple leaving a home to their kids, the threshold is ?650k. This applies even if one party has died many years before the other. There is some caveat here to do with a main residence passing to direct descendants, but for most people who's main wealth is in their home and they leave it to their kids, the tax break applies, regardless of whether the kids keep of sell the house.

In the meantime, the super-rich will always have the ways and means to avoid or evade any form of taxation.

 

[Stuart France]

I thought the way the rich folk passed on their really valuable property was to give it away to the next generation when they are heading for 70 years of age.  If they live another 7 years (in some nice rented property somewhere) then the inheritance tax on the property disposal is zero.

 

[ttxela2]

Up until the 1960s most people expected to live with their parents until they could afford their own place (or qualify for council housing).

Prior to buying my first house (for which I got the deposit by working days with a surveying crew on the construction of the Spalding bypass and nights in various tunnels under London) I put my name down on the list for council housing with my then girlfriend I was 19 at the time. She had a younger sister who also wanted to set up home with her boyfriend and declared her intention to get pregnant in order to jump the queue for council accomodation. This she did and was duly awarded a flat in Haverhill (a dubious prize by any measure) within a few months.

Many years later when I was in my mid 30's and with that girlfriend long gone, my parents had a message left on their answerphone from the council for said girlfriend and myself (we lived with them at the time of applying) we had come to the top of the list and qualified, not for a house or flat to rent but for a shared ownership scheme on a new development.

I didn't take them up on it.......

 

[Fjell]

It?s actually now a million for a couple where the family home is being left to children. 2 x ?500k. Along with triple-lock pensions, it forms the heart of the Tory pensioner package.

So yes, best to downsize to grannyflat by about 75. If anyone wants one in Kirkby Lonsdale, let me know. The market is dead, possibly along with some prospective buyers. I?m hoping for more cheer when they have all had their second jabs.

Other top tips:

1. If you die under 75, pension pots are inherited tax free. Over 75 inheritor pays income tax, but you don?t have to take it all at once, you can treat it as a pension (taking a single lump sum will get hammered for income tax). This latter point is not obvious to many. You could keep it until you retire yourself, pension funds that last for ever through families. You too could be the Duke of Westminster.
2. EIS investments and trees pay no tax. Ditto, Duke of Westminster. And Dyson, who seems to own half the farmland in England these days.
3. A QNUPS pension abroad pays no tax on death in the UK. You can have one when resident in the UK. This is well into the world of hard core legal tax avoidance, and useful for people who exceed the lifetime pot limits (doctors etc). Pros only.

 

[ttxela2]

I've told both my daughters when I die they can equally share responsibility for my remaining debt's. It's not all bad though, one can have my camping stove and the other will get my moped 

 

[Paul Marvin]

When we started out our expectations were the same as everybody's a two up two down mid terrace and if you were very lucky an end terrace , this coupled with high interest rates kept your feet firmly on the ground . However the expectations from a first time buyer these days is much different and coupled with ridiculously low interest rates has caused the problem nowadays . Money is just to cheap to borrow ! hence the house inflation prices .

 

[sinker]

When we started out our expectations were the same as everybody's a two up two down mid terrace and if you were very lucky an end terrace , this coupled with high interest rates kept your feet firmly on the ground . However the expectations from a first time buyer these days is much different and coupled with ridiculously low interest rates has caused the problem nowadays . Money is just to cheap to borrow ! hence the house inflation prices .

We had a small house to sell in Bethesda last year; it had been rented out for a few years and empty for two so it was tarted up and put on the market for ?70k. That's right, a two-up / two-down terrace for ?70k. Bargain of the century right?

What a hassle! A load of spoilt kids in their early twenties coming to look at it with mum and dad in tow.
All driving Audi's and Range Rovers.
It soon becomes obvious that mum and dad are stumping up most of the cash.
The kids are turning their noses up at it; too small, too narrow, we've got two cars and there's only room for one, don't like the kitchen, don't like the bathroom, there's no "outdoor living space" (garden) no "entertaining space" (WTF...??), no en-suite master bedroom, no "guest" bedroom. One even complained that it had no outdoor tap!!
FFS it's a Victorian quarryman's terrace house. It didn't have electricity until 1950 and it didn't have an indoor bog until 1976!!

"I don't like it dad, there's NO WAY that I could live here!"

Spoilt ba$tard$ don't know they're born!!

12 months of these to$$ers turning their noses up at it and it eventually went for ?67k. Gave it away.

 

[Fulk]

Did it go to a tosser (for aweek-end 'retreat') or to someone who's actually going to make a life there?

 

[tomferry]

That is a bargain ! Couldn?t buy a front lawn here for that ! A private job I am working on their entrance is between 2 neighbours lawns the land layout is stupid everyone owns random Patches not even really near their house , anyway the lady I working for wants to buy one it?s probaly 6-4m square they turned 47k down !!

 

[pwhole]

My parents live on the outskirts of Rotherham in what is rapidly becoming the most desirable area in town - it's on the edge of open fields, and planning permission is being given to build new housing. Unfortunately it's all being given to tuppenny millionaires building toytown mansions. I suspect the land may be part of one of the large estates that have traditionally owned most of this area (possibly the Sitwells). A friend of my parents owned a field down the road, presumably a last inherited remnant from a farm that was once in her family, and she recently sold it to a building developer for ?6 million, to build (I think) 36 houses on, but they won't be 'affordable'.

My parents' house is a bungalow with a big and lovely garden (all done by them, it was clay, rubble and weeds when they bought it) and it's put on ?100K in the last ten years, based on what the neighbours have sold theirs for, and without lovely gardens.

 

[sinker]

Did it go to a tosser (for aweek-end 'retreat') or to someone who's actually going to make a life there?

Newly qualified teacher who had just landed her first job in the local primary.
She'll be off again in a couple of years I suppose, climbing the ladder on her way to being a head teacher (or 'school manager' as they will probably soon be called....) by the age of 30. That's the dynamic career path in teaching these days; but I think it went to the best person in the end 

I think Covid 19 must have got to me over the last year or so....I never used to be so cynical or miserable....

 

[pwhole]

I've always been cynical but never miserable. Nothing to do with Covid, though that has made me slightly more miserable, but that's only as it's ruined my life and career for a year so far - and I've realised the world's population is far more retarded than I'd hoped it was at this stage of the game. Oh well. Staying cheerful is very important, no matter what happens. I emptied my parents' garage into a skip the other day, but they said they'll save the loft clearance for us to sort out 'When they're both gone'. Ulp. When I asked what was up there my mum said 'It's all in cardboard boxes'. Ulp..

 

[Cantclimbtom]

That is a bargain ! Couldn?t buy a front lawn here for that ! A private job I am working on their entrance is between 2 neighbours lawns the land layout is stupid everyone owns random Patches not even really near their house , anyway the lady I working for wants to buy one it?s probaly 6-4m square they turned 47k down !!

maybe you could get a business mortgage and buy a bunkhouse in Betws? Job and home all in one, small lottery win for the deposit would help matters greatly

 

[Paul Marvin]

When we started out our expectations were the same as everybody's a two up two down mid terrace and if you were very lucky an end terrace , this coupled with high interest rates kept your feet firmly on the ground . However the expectations from a first time buyer these days is much different and coupled with ridiculously low interest rates has caused the problem nowadays . Money is just to cheap to borrow ! hence the house inflation prices .

We had a small house to sell in Bethesda last year; it had been rented out for a few years and empty for two so it was tarted up and put on the market for ?70k. That's right, a two-up / two-down terrace for ?70k. Bargain of the century right?

What a hassle! A load of spoilt kids in their early twenties coming to look at it with mum and dad in tow.
All driving Audi's and Range Rovers.
It soon becomes obvious that mum and dad are stumping up most of the cash.
The kids are turning their noses up at it; too small, too narrow, we've got two cars and there's only room for one, don't like the kitchen, don't like the bathroom, there's no "outdoor living space" (garden) no "entertaining space" (WTF...??), no en-suite master bedroom, no "guest" bedroom. One even complained that it had no outdoor tap!!
FFS it's a Victorian quarryman's terrace house. It didn't have electricity until 1950 and it didn't have an indoor bog until 1976!!

"I don't like it dad, there's NO WAY that I could live here!"

Spoilt ba$tard$ don't know they're born!!

12 months of these to$$ers turning their noses up at it and it eventually went for ?67k. Gave it away.

I have a friend like that cant afford a house BUT has a Audi Q 3 on tick of course chopped in a 17 plate for a brand new one because ..... " there was a squeak somewhere inside  " has all the gizmos and gadgets very best of cave and dive equipment cant use the Audi to go caving in case it gets dirty and goes and hires a car for the weekend they hemorrhage money . Best of all the Q3 does 4.2 miles per day for his mrs to go to work and back , she has a better car than the pharmacist. Never heard of a thermos flask that I recommended to him when he told me the ridiculous amount he spends on coffee per week , over ?100 just on bloomin coffee !!! 

 

[AR]

At least Sinker's place went to someone who's going to put back into the local community, rather than use it as a second home because booking a holiday cottage/B&B/hotel for a weekend is so difficult and you're entitled to your little luxuries. I recall years ago being darkly amused by a Grauniad piece where Polly Toynbee was tying herself in knots trying to make out it wasn't really wrong that her and all her rich friends had their little place in the Cotswolds and it wasn't hurting anyone and they were really giving back something to the villages. Yes, I'm sure all the people displaced to grotty estates round Gloucester  because they haven't the slightest chance of finding a house somewhere near the villages they grew up in are consoled by that.

Alternatively, it could have been bought by townies who move to the countryside and then spend all their time whinging because the reality of rural life doesn't fit in with their idealised vision.

I've made a point of not looking up how much my parents' house is worth even though as a 4-bed semi in a national park it could well fetch a packet right now, because I don't regard it as "my" asset but their home, and having seen the money from my wife's grandmother's house go on care home fees after she developed dementia, I'm aware that inheritance isn't guaranteed...

 

[droid]

I come from Hathersage.

At a school reunion, the only people that still lived in the Hope Valley and surrounds were those that inherited houses/were gifted them by parents/relatives.

That was no more than 10% of those present.

2up2down on Ranmoor Lane thick end of ?350k....

 

[Fulk]

I agree that house-price inflation is a disaster, and  equally so is the business of rich townees moving into the countryside to buy up property there. However . . . it takes two to make a sale ? a buyer and a seller. Could it be that some part of the reason for the ludicrous prices that houses in ?desirable areas? can fetch is greed on the part of (local) sellers?