www.telegraph.co.uk/news/politics/libera...uses-says-Nick-Clegg.
Grandparents to use pensions to help young buy houses, says Nick Clegg
Middle-class parents and grandparents will be able to use money from their pension funds to give grown-up children a deposit to get on the housing ladder, the Liberal Democrats have promised.
Nick Clegg, the Deputy Prime Minister, revealed details of the “pensions for property” scheme at the Lib Dem conference in Brighton.
The scheme will be targeted at parents who have built up a pension fund worth around £40,000 and are nearing retirement.
Lib Dem officials estimated that around 250,000 households have pension assets of around that value.
They include many public sector workers including teachers and nurses.
Wealthier parents with more valuable pensions will be able to use the scheme, but ministers said they are likely to have other financial assets that they can use to help their children.
Pension schemes typically allow members to take around a quarter of the value of the fund in a lump sum when they retire.
Some people use the money for home improvements, holidays or cars. Ministers said the scheme would allow them to forego such things and help their children instead.
Under the new scheme, parents would sign an agreement with their child’s mortgage lender promising that the lump sum will go towards the cost of the child’s home.
So a parent with a £40,000 pension pot would be able to promise £10,000 as a deposit on a child’s first home.
Mr Clegg announced the scheme on the BBC’s Andrew Marr show.
“We have thousands of young people who are desperate to get their feet on the first rung of the property ladder but deposits have doubled and the number of young people asking help from family members has doubled,” he said.
“We are going to work out ways in which parents and grandparents who want to help their children and grandchildren buy a property of their own, we are going to allow those parents and grandparents to act as a guarantee if you like so their youngsters...can take out a deposit and buy a home.”
It'd be easy to think that, rather than helping the poor, this is merely a transfer of more wealth to the banking system.
It's quite a brilliant system really. You incentivise everyone to 'get on the housing ladder'. It's pretty much a no-brainer to do so, particularly as prices rocket upwards.
When people sign on the dotted line you've got a gun to their head for thirty years, and they will pay back several times to you what they've borrowed.
If they can't pay it back, you steal their house, and then sell it to someone else, who will almost certainly have to take out another mortgage to buy it. Meanwhile, if the first person can't pay off the 'money' they owe you after you've stolen their house, then they're still beholden to you.
When there's a bubble you rake it in off people taking out mortgages. Then when this is no longer sustainable, the bubble pops, and you repossess tens of thousands of people's houses. Then you tell people that housing is 'cheap' again, and they need to 'get back on the ladder', and the whole charade begins again.
And if you do lose out, you go to the government, they give you billions of dollars, and tell the people who are paying back their mortgages and whose houses you've stolen that they have to pay it back, as otherwise the banking system will collapse.
This is before you go into 'equity release' which is an absolute racket as well.
Now those people who have managed to 'buy' their house, via the huge transfer of wealth from younger to older generations that an inflated housing market entails, should release some of their pension, so that young people can get a mortgage in the middle of a massive depression, because the leader of the 'liberal democrats' thinks this would create a 'fairer' society.
I can see a few holes in this argument.
