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| Thousands of Britons Will Lose Their Homes |
| Two million say meeting housing costs is a constant struggle |
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Peter Hinchliffe (Hinchy)  |
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Published 2008-06-21 03:09 (KST) |
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A charity that helps the homeless, predicts that 53,000 Britons will lose their home this year.
A deepening financial crisis in the United Kingdom means that many are struggling to meet the monthly repayments on money borrowed to buy houses.
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FROM THE SECTION |
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| Soaring fuel and food costs are stretching family budgets to the breaking point.
The financial turmoil began in the United States when millions of dollars were loaned to people who had no hope of repaying. Britain is now threatened by a similar tsunami of debt.
Shelter, a charity set up in 1966 to campaign for decent housing for all, says that 6 million families are suffering stress or depression due to today's sky-high housing costs.
People desperate to keep a roof over their heads are spending less on food, selling possessions, borrowing from friends and family and depriving their children of treats, says Shelter.
Two million say meeting housing costs is a constant struggle, with 400,000 falling behind with rent or mortgage payments.
Shelter is calling on Gordon Brown's Labor government to carry out its promise to build 3 million new homes by 2020.
The charity also calls for mortgage lenders to use repossession only as a last resort, and provide more active and earlier help and support to homeowners.
The Edinburgh-based bank HBOS, owner of the U.K.'s biggest mortgage lender, Halifax, said yesterday it expected house prices to fall 9 percent this year and house sales to plunge by 45 percent, and warned that this could lead to an increase in customers falling behind with their home loan payments.
Wall Street bank Lehman Brothers is prepared for a 28 percent drop in British house prices. Morgan Stanley suggests that prices could fall by a fifth over two years.
A 28 percent decline would leave more than 2 million people with negative equity in their homes.
The Council of Mortgage Lenders reports a 19 percent drop in lending to U.K. homebuyers this year.
The chilly blast of the credit crunch crisis is having a devastating effect on Britain's big house-building firms. Barratt, which has built scores of thousands of homes in the U.K. and owns land to accommodate 130,500 new houses, has seen the value of its shares fall by 90 percent in just over a year.
Fifteen months ago the firm was valued at 4.7 billion pounds ($9.4 billion). This month the value fell to 280 million pounds.
Builders are shelving plans for new homes. The government wants them to meet a target of 240,000 new homes a year. Last year 170,000 homes were built. This year less than 100,000 are likely to be completed.
The number of houses being built yearly has slipped to the lowest level since 1945. The collapse of the building industry is expected to result in the loss of 100,000 jobs this year.
Estate agents who handle the sale of houses are caught up in the maelstrom. Around 150 branches are closing down every week.
Other businesses connected to the housing market, such as removal firms and do-it-yourself suppliers, are also feeling the pinch.
House prices in England have accelerated at a frightening pace in recent years. Prices vary widely in various parts of the country. The average price in west London is currently 565,866 pounds. My home area in Yorkshire ranks 82nd in a price league table of 120 towns and cities, with an average price of 158,803.
I bought my present house in 1972. Now, even with prices on the downturn, it is worth at least 35 times more than I paid for it.
This is only the second home I have owned. Estate agents were not involved in either purchase. I bought my first house from a journalistic colleague. After owning it for five years, I wanted to sell it to move back to my home county.
On a Saturday morning, I was interviewed and offered a job on the newspaper nearest the village where I grew up. On the Sunday I traveled back to Northumberland, where I was then working. On the Monday morning my wife, while pegging out clothes on a washing line, told our next-door neighbor that we would be leaving. Half an hour later, she mentioned this in the village shop. At 10:30 a.m. a man knocked on our door saying, "I understand your house is for sale. My son wants to live here."
And his son bought the house!
Hundreds of thousands of British people, in search of sunshine and a more equable climate, have bought houses on Spain's Mediterranean coast in recent years. The Spanish property boom has burst.
Yesterday the Madrid stock market index closed down 2.7 percent. The fall was triggered by fears of a property crash.
During the past week, the shares of one building firm have fallen 62 percent.
Last year more than 800,000 homes were built in Spain, a large proportion of them for people from other countries eager to live there. That is more houses than were built in France, Germany and Italy combined and has led to a glut of unsold property.
More than 70 percent of British people own their homes, a greater proportion than anywhere else in Europe.
The saying "an Englishman's home is his castle" is as old as the concepts of English common law. It can be traced back to the 16th century and is based on the idea that men and women are the bosses in their own homes, and no one can tell them what to do there.
In the present climate, many homeowners will have to become tenants.
For far too many English people the ambition to own their "castle" will crumble into the dust.
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©2008 OhmyNews
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 Comments Note: Kindly refrain from personal attacks and profanity. |
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1. cash poor(12)
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bob , 2008-06-22 11:49
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