Quote:
Originally Posted by tweetiepooh
I remember what my dad tells me that Labour only care about themselves and will do and say whatever it takes to remain in power. And if you disagree they'll call a strike and no-one can work but it's not their fault.
There is a difference between what you can sell a house for and what it costs. Look at your insurance, rebuild value is usually well below sale value. So while it seems that they are giving away a £120k house, all they are really giving is £50k (made up figures). If the recipient sells in those early years the tax is £37k so £13k short, plus reduction in benefits and costs on the property. This assumes no price rises in housing. Current values are 10% (England) so in 3 years the house could be worth in excess of £150k -> £47k tax.
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The land the property is built on isn't free, which explains the difference. As a general rule houses come with the freehold for the land, flats the leasehold unless a group come together to purchase the freehold for the entire complex.
Both of these have value, both make up the difference between rebuild cost and sale cost, and either would be included in the sale, hence what is given away is open market sale cost.
Either way it's incredibly stupid and will ram the housing benefit bill up the backside as it further depletes social housing by shifting more stock to the private rental sector. It happened with right to buy, it would happen with this.
If you gave me a council house for free the first thing I'd do is remortgage it and use the proceeds to buy a smaller buy-to-let property, or use the equity as deposit on a private purchase home and rent the ex-council property on the private market.