Re: WCML debacle(s) and future electrification projects.

In message
<58f3e331-640e-44d7-a249-c49dee39c4ff@xxxxxxxxxxxxxxxxxxxxxxxxxxxx>
i.g.batten@xxxxxxxxxxxxx wrote:

On Jan 9, 7:41 pm, Graeme Wall <R...@xxxxxxxxxxxxxxxxxxxx> wrote:

By subtracting the travel costs you've saved.

OK, but add in the cost of extra meals and drinks out because it's too
much hassle cooking for one.

It's no more hassle to c*** for one than it is to cook for N: it just isn't
any less hassle, either. And if someone is single, they have that issue
wherever they are, of course.

Not in the scenario I suggested where the family is still at home somewhere
else in the country.


Nope the goal posts are still where they were with someone unable to sell
their current property in order to move closer to work.

Anyone can sell a property. The issue is how much they ask for it.
Suppose I put my house (bought fifteen years ago) on the market for
precisely the value of the outstanding finance. It would clearly
sell: who'd resist a three bedroom semi which can be rented out for
say £600/month when it's for sale at £45K, which is a 16% return on
capital, say 12% after expenses? Finance wouldn't be an issue, as
there are plenty of landlords who would have that as walking about
money.

Now put yourself in the position of someone who bought 2 years ago with a
110% mortgage, still think you can sell easily? People like you and I who
have lived in the same house for 15+ years are very much the minority. The
average time between moves used to be around 4 years.


Suppose I put it on the market at what I paid for it (£90K?) What I
paid+RPI (can't be bothered to look it up, probably about £130K?) Now
it's getting more marginal. But if I simply convert my mortgage
payments to notional rent and write off the deposit I fronted up
fifteen years ago as sunk capital, I can move for the balance of the
finance, yes?

See above


Suppose I decided that my choice was between working with my family in
city X or sitting on an unsaleable property in city Y (a friend of my
daughter now lives in China, where her family moved after the Rover
closure). Would it be irrational to write off the finance against
savings and sell it for a grand? Depends on the job, doesn't it?

I know whereof I speak. I `couldn't sell' my house in 1994, so I sold
it to a property broker for £36K cash. I'd paid £26K, the estate
agent `valued' it at £42, someone banged on the door and offered me
75% no questions asked, complete the following week.

That was 1994, this is 2009. I know whereof I speak, as a landlord there's
no way I'm going to front up say 100k for a property when I can sit on my
hands and buy it in a couple of months for 80k. And that's round here where
rents are going up. If, as you say, Birmingham rents are going down, there's
absolutely no incentive at all to buy property for rent/development.


The mistake is when people confuse ``somewhere to live'' with ``an
investment'', and treat houses as objects that have a specified
value. A house is worth precisely what someone will pay for it today,
not a penny more. No one expects cars to do anything other than
depreciate to zero.

Cars are not a limited resource, there has been an overcapacity in the
Western world for decades. In this country houses are in short supply and
that is a situation that isn't going to be improved any time soon even when
we come out of the current recession. In the long term the value of property
is going to go up.


Houses can and will be sold if the price is right.

Go on thinking that. My wife is a debt adviser for the CAB, she's in court
two days a week dealing with people who can't pay their mortgages. Virtually
no mortgage company is now going for posession as they just end up with a
stock of houses they can't sell. And these are hard-nosed businessmen who
merely want to cover their loans, not necessarily make a great profit on the
sale.



1500 quid a head?  Plenty.  Seen the price of renting villas in
Tuscany lately?  Priced up ski-ing for four in Colorado?  Seen the
price of cruises?

How many people do that as a family in the current economic climate?

Depends on what their finances look like, doesn't it? If you're the
couple down the road who are both GPs, in what way have their finances
changed, other than their mortgage just got cheaper? If you're the
couple over the road who both teach? The school ski-ing trip to
Colorado from the local comp is over-subscribed.

Unemployment hasn't yet bitten the middle classes:

Say that in the City.

it probably will,
but people aren't good at scrying the future. Now if people have
been funding their lives month by month by borrowing money against the
notional increase in value of their houses, they're completely and
absolutely fucked. If they've taken mortgages on which have medium-
term rate increases built in, they're fucked. But how real is that
problem? We're going to find out, I suspect, but I think we'll find
(see the incorrect social assumptions that lead to the hysteria over
heterosexual AIDS) that the problem is that a small number of people
have very big problems, not that there is a widespread issue.

In my wife's experience it is a rapidly growing problem.

I agree with you about the AIDS scenario.


Many, many years ago, over on uk.misc, someone started the ``of
course, we all are homeless if we can't afford our mortgages'' and
``we're all only three paychecks from homelessness'' thing. They were
shouted down by more than a few people saying that although that may
be true on average, mortgages are a non-issue for anyone over 55-ish,
a small issue for anyone who didn't keep on trading up to the limit of
the mortgage they could `afford', a non-issue (in general) for people
whose parents had died with property, etc, etc. The set of people
whose income is fed entirely into their outgoings is not small,
obviously, and I'm not saying their problems aren't real problems: but
it's a mistake to assume that's 100% of the population.


It's also a mistake to think it is a minority of the population who are
affected.

--
Graeme Wall
This address is not read, substitute trains for rail.
Transport Miscellany at <http://www.greywall.demon.co.uk/rail/index.html>
.

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