Old Conservatives don't understand

[motorbiking]

A real property is not a hypothetical property.

With your example property. When did the council acquire the property and how much have they spent maintaining it over the last 10 years?

You seem to have ignored the not very small print of the calculator.

 

[JonathanM]

Interesting graph here showing that land prices (green) for major house builders have flatlined for 20 years. I'd always thought the high price of houses these days had been caused by the price of building land. I know when you look for a single plot, the prices are outrageous. But it seems much of the increase in prices is pure profit. So, it could make sense for councils to get into the building game. Surely better than buying shopping malls? Can the land price figure be true? Not sure on the methodology.

Builders are making thumping profits by over-charging for new homes – new findings | Brunel University London

www.brunel.ac.uk

 

[JohnD]

So I can build a house rent it out at below market rates and then sell it to the renter after say 5 years giving him a 96k discount under right to buy having generated enough capital and income to build 2 more even allowing for the cost increases between project A and project B.

Just to check, if it's such a great idea, how many times have you done that?

Why are you so reluctant to agree that private tenants should have the same right to buy rented homes below their value?

 

[motorbiking]

Last I checked I was not a council or a public body.

 

[IT Minion]

According to a link denso provided. They do. No doubt the cost goes up because of all the useless employees that have to have meetings about the cost and check the 30 year nonsense plan.

No, you plum, that's 46k over 30 years. Not each year.

An average of 1.5k a year. Which is more sensible, they aren't building a new extension for each house every single year.

Maintenance of the existing tenanted stock (subject to Right to Buy sales and inflation) is modelled at a total of £1,250million over the 30 years using the latest HIP figures equating to c£46,750 per unit

link: https://democracy.bristol.gov.uk/documents/s68685/Appendix A4 Business Plan Commentary.pdf

How much do you pay to maintain your house? I'm getting serious "It's one banana, Michael. What could it cost, $10?" vibes here

 

[fillyboy]

How much do you pay to maintain your house? I'm getting serious

20 years ago Birmingham Council were paying people 90 grand a year to change the bulbs in street lights,

 

[motorbiking]

No, you plum, that's 46k over 30 years. Not each year.

An average of 1.5k a year. Which is more sensible, they aren't building a new extension for each house every single year.

link: https://democracy.bristol.gov.uk/documents/s68685/Appendix A4 Business Plan Commentary.pdf

How much do you pay to maintain your house? I'm getting serious "It's one banana, Michael. What could it cost, $10?" vibes here

thanks for the spot, in any case nobody is getting 70% discount.

Social housing sales and demolitions 2021-22: Right to Buy sales

www.gov.uk

 

[carmanmemoranda]

20 years ago Birmingham Council were paying people 90 grand a year to change the bulbs in street lights,

That's relevant to rtb how exactly?

Any proof of the statement either?

 

[Notch7]

Interesting graph here showing that land prices (green) for major house builders have flatlined for 20 years. I'd always thought the high price of houses these days had been caused by the price of building land. I know when you look for a single plot, the prices are outrageous. But it seems much of the increase in prices is pure profit. So, it could make sense for councils to get into the building game. Surely better than buying shopping malls? Can the land price figure be true? Not sure on the methodology.

View attachment 333731

Builders are making thumping profits by over-charging for new homes – new findings | Brunel University London

www.brunel.ac.uk

house builders make a lot of their profit margin on the increase in house price rises

everybody would love to be in a market where the sale price of you products increases while you are building it

no wonder housebuilders have an interest in controlling the market

 

[JohnD]

no wonder housebuilders have an interest in controlling the market

And bankrolling the Conservative Party.

 

[motorbiking]

house builders make a lot of their profit margin on the increase in house price rises

everybody would love to be in a market where the sale price of you products increases while you are building it

no wonder housebuilders have an interest in controlling the market

That of course, isn't true. The profit is in the cost vs sale price.. Any minor increase in value from start of project to finish of project is a rounding error. Not to mention that in the last 18 months prices have flattened or fallen a little.

The vast majority of businesses that manufacture goods are in the business "where the sale price of you products increases while you are building it". Exceptions are high techs, where the value falls due to innovation.

 

[denso13]

You seem to have ignored the not very small print of the calculator.

Is the maximum available discount 70% or not? It's a yes or no question.

 

[denso13]

Happy to summarise. According to industry data a new build costing around £139k including all costs has a value of around £320k when finished.

So I can build a house rent it out at below market rates and then sell it to the renter after say 5 years giving him a 96k discount under right to buy having generated enough capital and income to build 2 more even allowing for the cost increases between project A and project B.

As a council I am also in control of the planing process and exempt from many of the taxes corporations pay.

And forego 30 yrs rental income. You don't know how this works do you?

 

[motorbiking]

Is the maximum available discount 70% or not? It's a yes or no question.

Subject to deductions and caps - which you want to ignore.

And forego 30 yrs rental income. You don't know how this works do you?

Nobody foregoes 30 years rent. Per unit it would be less than 10% of asset owned life. (24 weeks out of 260)

You understand the model is Build it, rent it, sell it, repeat X2.

Here are the numbers over a 15 year period starting with 1 single new build sold after 5 years vs rented for the full term.

The Local Council is better off by £57k with my model. Plus they create 3-4 more council houses vs 1. They also avoid maintenance which might increase from about year 5 on.

All this moaning about how right to buy reduces housing stock - is nonsense.

 

[JohnD]

All this moaning about how right to buy reduces housing stock - is nonsense.

However, people like me, who say it reduces social housing stock, penalises the needy, increases public costs, dispossesses taxpayers to benefit a lucky minority, and feeds the private rental trade, are correct.

Strange that despite the beliefs you claim to hold about about the benefits of owners being forced to sell assets below their value, you dont want the same to be imposed onto private landlords.