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Nov. 14th, 2010
Ok, so the government says that by paying less housing benefit this will cause rents to drop.
This is obviously arguable - but let's take their word for it for a moment.
This drops the return on property - because you'll be getting less back for your investment.
Which means that the property is worth less.
Which will cause the market to drop.
Now, I'm fine with that*, but it seems like an unlikely thing for a majority Conservative government to want...
*It makes it easier for first-time buyers to buy. And when people are buying there's less pressure on the rental market, which pushes prices down - we've got the opposite problem at the moment. Of course, there's the question of how much a falling market will cause people to avoid buying as well. Complex stuff, economics.
This is obviously arguable - but let's take their word for it for a moment.
This drops the return on property - because you'll be getting less back for your investment.
Which means that the property is worth less.
Which will cause the market to drop.
Now, I'm fine with that*, but it seems like an unlikely thing for a majority Conservative government to want...
*It makes it easier for first-time buyers to buy. And when people are buying there's less pressure on the rental market, which pushes prices down - we've got the opposite problem at the moment. Of course, there's the question of how much a falling market will cause people to avoid buying as well. Complex stuff, economics.
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