Who does the property boom benefit?

As I see it the only people to benefit from the hike in property prices are

banks and other lenders
estate agents
surveyors
the government with it's stamp duty
councils with increased income from Council Tax

Poor old Joe Public gets fleeced left right and centre. The only ones who can benefit as I see it are folks who move up North where property prices are on the whole cheaper than down South.

Am I just too cynical?

Our house has tripled in value over the last 6 years - largely due, IMO, to people buying similar houses as investments to rent out and pushing the price up. It has also contributed to the lack of community feeling on our road. When we first moved in there were families, we all chatted, looked out for each other - now I couldn't tell you who this month's neighbours are.

On the other hand I guess for those who were lucky to get on the property ladder before the prices started heading skywards - its been a good investment and will have made them a little more financially secure.

My council tax hasn't increased due to the price of the property so I can't whinge about that one. I agree with you about the Estate Agents though. They must be rubbing their little paws together at all that commission!

Originally posted by beckb
On the other hand I guess for those who were lucky to get on the property ladder before the prices started heading skywards - its been a good investment and will have made them a little more financially secure.



But it only makes you financially secure if you sell it and release the capital but you still have to have somewhere to live, so while it's tied up in bricks and mortar you are no better off are you?

the main beneficiary must be lenders I think.
Council tax bands were based on property values in the early 90's, a change in value now has no effect on it.

There's nothing new in house price rises. When we first moved to Crookes in 1980 there were families living there whose children couldn't afford to buy in the area. They ended up moving to the newer suburbs as the prices were substantially lower.

As to who benefits, well if people see their houses as family homes which will be passed on to the next generation there will be no change and no beneficiaries as it will be just a pile of bricks and mortar like a miniature Chatsworth. If it's as an investment to be down-sized upon retirement then no change again as that's what happens now.

If massive house prices are preventing people getting on the ladder in their preferred areas then perhaps they should consider buying in less desirable areas. The beneficiaries there will be the local economy, local businesses and local schools.

I agree with Max on every point there. The property market is a living breathing fluid thing that ebbs and flows through time. The only thing that you can guarantee is that values will go up over time.

Don't knock it, our modern society is totally underpinned by one single thing - property rights. Confer them to ordinary people and you get distributed wealth. Deny them, and you get Zimbabwe.


Council Tax rates were based on 1992 figures. There is talk about reappraising them again, so don't get too excited.

Originally posted by Mo
The only ones who can benefit as I see it are folks who move up North where property prices are on the whole cheaper than down South.



That would still be the case whether there was a boom or not. Houses in the south have always been, and probably always will be worth proportionally more than in the north.

Too true, and of course suffer the swings far more too.

Originally posted by t020
That would still be the case whether there was a boom or not. Houses in the south have always been, and probably always will be worth proportionally more than in the north.

True, but things are starting to change. Business in London is starting to move up North to Manchester, Leeds and Sheffield etc. It makes sense to open offices up North because office rent is too much in London. This is meaning more professionals with money are moving up North and students studying up here are staying rather than moving down to London. The professionals can afford to pay more for property and quite a few are buying up the inner city living flats at what seems like a snip to them at £150K. This will eventually have a knock on effect, because as these young professional start getting married and having kids, they will want to move to the suburbs and effectively 'upgrade' to a house. So house prices will go up compared to flats, which is what it's like in London. If a flat is £150K then a house upgrade would be £200-250. So it'll end up pushing the prices of houses up. The north has a lot of catching up to do with the South and we are just at the beginning now. More and more business and job opportunities are coming to the North.

Houses in Sheffield suburbs are already more than flats in the centre though. I do agree that the north/south divide may narrow as more businesses move up north, but I still think that a situation where average prices up north are equal to those down south is a long way off.

Does this mean that salaries are going to be going up in Sheffield to keep up with cost of living (including house/rent) prices???

Originally posted by t020
Houses in Sheffield suburbs are already more than flats in the centre though. I do agree that the north/south divide may narrow as more businesses move up north, but I still think that a situation where average prices up north are equal to those down south is a long way off.

Houses in your area maybe, but you can still buy a 3 bed terrace for 100-120 K in my area (Norton Lees/Meersbrook), and in other areas, 80k etc. So flats are more expensive currently.

I agree it will take time, but the North still has a lot of catching up. I am one of those who left London to come here so I could buy property!

Originally posted by evildrneil
Does this mean that salaries are going to be going up in Sheffield to keep up with cost of living (including house/rent) prices???

That I don't know, I could earn more doing what I do down south, but relatively speaking I would not be better off. For a start I wouldn't be able to afford to buy so I'd have to rent and everything is more expensive in general in London. I'd rather earn what I do and have a better standard of living here.
Salaries are going up in some jobs, I know that my company have adjusted theirs over the years to compete more with the South and encourage people up here.

Originally posted by Foxxx
Houses in your area maybe, but you can still buy a 3 bed terrace for 100-120 K in my area (Norton Lees/Meersbrook), and in other areas, 80k etc. So flats are more expensive currently.



No I'd still disagree. You're looking at the most expensive flats (i.e. the so called luxury apartments) rather than the average city centre flat. If you're going to look at the "luxury apartments" then to make it a fair comparison you must compare prices with houses in the most expensive suburbs, in which case houses would win. If you're going to look at the average flat price in the city centre versus the average house price accross all suburbs then I still think the house would win.

Originally posted by Foxxx
Houses in your area maybe, but you can still buy a 3 bed terrace for 100-120 K in my area (Norton Lees/Meersbrook), and in other areas, 80k etc. So flats are more expensive currently.

I agree it will take time, but the North still has a lot of catching up. I am one of those who left London to come here so I could buy property!

A good example of prices down here being more expensive ... ... our property here, is worth around £190,000ish. 3 bed semi, drive, 110" garden. And this as an OK area - not the worst not the best.
However. a nice , peaceful area, no kids, no layabouts etc etc. I suppose "Dore" fits the bill or "Ranmoor", perhaps for a 3 bed semi is £260,000+.

Alex

Originally posted by t020
No I'd still disagree. You're looking at the most expensive flats (i.e. the so called luxury apartments) rather than the average city centre flat. If you're going to look at the "luxury apartments" then to make it a fair comparison you must compare prices with houses in the most expensive suburbs, in which case houses would win. If you're going to look at the average flat price in the city centre versus the average house price accross all suburbs then I still think the house would win.

Well I had a look and even the cheapest city centre flats which are only 1 bedroom are starting at 83.5K.

http://www.vebra.com/home/solex/results.asp?list=0&fid=11086&ord=undefined&bid=0&dbt=1&p=1&asv=undefined&cur=GBP&thu=undefined&vto=undefined&nba=undefined&vtourlist=0

sorry for long link, don't know how to do a short link!

This is still expensive compared to 2/3 bed houses in some areas in Sheffield but of course cheaper than in others. The knock on effect is already happening. My area which is a nice residential, up and coming area is booming. 5 years ago you could buy a 3 bed house for 35K. 2 years ago when I bought it was 70K and now they've gone up past the flats at around 100-120K.

moving jobs up north for companies means a saving in the wage bill as well, you don't think they pay the same as a london wage do you?

Originally posted by t020
No I'd still disagree. You're looking at the most expensive flats (i.e. the so called luxury apartments) rather than the average city centre flat. If you're going to look at the "luxury apartments" then to make it a fair comparison you must compare prices with houses in the most expensive suburbs, in which case houses would win. If you're going to look at the average flat price in the city centre versus the average house price accross all suburbs then I still think the house would win.


:rolleyes: Don't know why people compare city living with a house in the suburbs. City living is a different way of living all together, and in many cases in much less space. Comparatively, if you look at say a £/sq.m value, the 'luxury' flats would probably be more expensive than a house in a nice part of the city.

If you are paying £250k for a nr. top floor CC apartment with a single parking space, or say £280k for a 3/4 bed house in the suburbs, with parking for 3 cars and a garage, comparatively if you work the space out between the two, you will be paying more in the city centre flat. The only way to work out the comparison is with location and size, as opposed to whos got the biggest balls (or the largest price tag for each market segment)

Its very hard to compare, where do you draw the line with a luxury flat? in leeds a luxury flat can fetch £1m - however a house in the equally nice Roundhay park area (5/6 bed) will be around £850,000 two different living scenarios.

We are just getting flooded with too many flats now, I just don't know what the council want from this city its nice to have derelict building / sites rebuilt on, as it attracts new people to the area, but just how many more flats! Still, where theres a demand, there will always be a developer to fill the gap.

As you say, there is still a HUGE demand, and there is a huge shortage of housing in Sheffield, so there is no reason why it won't continue and mature like any other market.

The thing to remember is that it's apples and oranges. People like different things, and there are plenty of people who enjoy living in apartments.

Take a look around the forum at the people that actually live in them. I've not heard a single person saying anything other than that they love it (cue Mr Craig :))

It's not for everyone, but neither is every area of town. There are plenty of moans about different areas, from those who live there, but funnily enough, none from those who live in the seemingly maligned city centre apartments.

I remember when I got my first mobile 12 years ago, people used to take the micky at work. They now buy them for their 8 year old. :roll:

Just think of those who live in apartments as 'early adopters' :thumbsup: Everyone else will catch up sometime. ;)

Yeah and what will probably happen, as has happened in lots of cities, is that inner city flats won't be trendy anymore and houses will become the new trend. It goes in cycles, people move into the flats because that's the cool thing, city living etc etc, then they'll realise they can buy a house less than 10 mins from the city centre where they can have kids and family life etc and flats won't sell as they won't be popular so they'll get sold off to housing associations and 'scumbags' for want of a better word will move in and the flats will become run down and no go areas. Its happened before.

You're missing the big difference though Foxxx.

The new apartments in Sheffield belong to people who have a vested interest in their ongoing success.

Virtually everything that went before was Local Authority.

There are plenty of flats in Ranmoor, Fulwood, Broomhill, etc, etc, that have been there since the 60's and longer. They are still very very nice places to live.

I remember a time when anyone in our social class could not afford to buy a house, that was only for the rich, anyone else had to rent, be it private or council.

It is only now, that there is virtually full employment and wages have gone through the roof, that people can buy what is after all the basic human requirement, a house to live in.

I still have to live in a council house to rent, after working hard all my life, three score years and ten, plus the rest, must have been born in the wrong bed at the wrong time!!!:loopy: :loopy: :loopy:

Originally posted by halevan

I still have to live in a council house to rent, after working hard all my life, three score years and ten, plus the rest, must have been born in the wrong bed at the wrong time

The difference is though, halevan, people's attitude to credit. My parents-in-law are in exactly the same situation as you - mid 70's, council house - because they were always brought up to think that if you can't pay cash for it, you don't have it! Their attitude has changed over the past few years when they've seen what we've got by way of HP etc and they've thought 'yes we can do that'. But of course with a major purchase such as a house, it was too late to do it.

Attitudes have now changed and people are more prepared to borrow money to better themselves, living off future earnings rather than current.

Utter nightmare.

The Tory's opened up home ownership to the masses.

The Tony's closed it

Where is the steelhouse exactly? Is it that place on top of causeway betting shop? According to this article they're turning that into luxury appartments, but they did that quickly! The scaffolding wasn't on for that long was it or have I been dreaming??

http://www.thisissheffield.net/ViewArticle2.aspx?SectionID=58&ArticleID=850286ctly?

Sorry this one:

http://www.thisissheffield.net/ViewArticle2.aspx?SectionID=58&ArticleID=850286

A friend of mine used to own that building, and sold it at auction with planning consent for the loft flats. £500k was the gift wrapped price tag.