The GB housing market is fecked. It has been for – well, for a very long time actually. That’s if it ever worked as intended, of course. You know, people having a home near their work, one which is the right size and shape for its number of occupants. That sort of thing.
I know, I know, does make you laugh, doesn’t it? “Hahaha, don’t be so simple” I can hear you chortle as you read. If only…but this isn’t funny. It isn’t funny at all. In fact, it’s so serious that it will destroy our communities, unless we get a grip.
And, let’s face it, Boy George’s Help to Buy nonsense is more likely to land a number of us in a tent – our very own version of America’s Tent Cities, proliferating mushroom-fashion since the US housing bubble popped five years ago – due to, guess what – people taking out 95% mortgages which they couldn’t afford.
So of course, the Big British Idea is to encourage unwary first-time buyers to launch themselves into a 95% mortgage, cos this time it’ll be different! Woohoo!
What was it Einstein said? “Insanity is doing the same thing over and over again and expecting different results”. Let’s see what happens to George’s marvellous medicine when interest rates go up, and they will.
Granted, you won’t find many Einsteins in our current government and cheap election gimmicks, like this one, are only to be expected from a bunch of bad eggs, who cut their teeth in professions where style is king and substance a tedious inconvenience. From Tory Chairman Grant Shapps alias Michael Green to Call-Me-Dave Cameron whose Public Relations career path provides an interesting read. You really, really couldn’t make this stuff up.
So what’s the cunning plan this time? Who might they have in mind? who could stand to gain from this initiative? Well, banksters and mortgage lenders for a start. Obvious Tory territory. These guys will have a field day working out their shiny new fees. Kerching! And a forest of estate agents’ FOR SALE signs will mushroom like the US tent cities.
And surprise, surprise, the scheme had barely been live for five minutes when a bunch of nasty new tricks started taking maximum advantage of the UK’s criminally unregulated property market. The latest Dispatches on Channel 4 is dripping with the sort of shameless mis-selling we really should have seen the back of by now. Slick-haired guys in polyester suits, calling themselves estate agents, bully gullible first time buyers into a tangled web of financial services, squeezing the financial life-blood out of their hapless home-hunters and netting themselves a nice fat bonus in the process.
Now don’t get me wrong – some of my best friends are estate agents, but the chilling fact is that, in the UK, anyone can set themselves up as an “estate agent” overnight with no qualifications whatsoever. And that’s insane. These people are pretending to guide us expertly through the biggest financial commitment most of us will ever make – or perhaps that most of us should never make?
The regrettable result of this lack of professionalism is quoted more frequently than a new housy-housy series pops up the telly: “Estate agent” is the fifth most mistrusted profession in the country, after car salesmen, journalists, bankers and politicians. But that can’t just be a British phenomenon, surely?
SO – WHAT DOES BORGEN DO?
Well, as you might expect, Borgen does something COMPLETELY different.
In Denmark, it is illegal to practise as an estate agent, unless you have qualified as an estate agent. And the long arm of the law will catch up with you with hefty fines – or worse.
To become an estate agent, you must have theoretical training and also two years practical experience in real estate. There are a number of educational options: The two main programs are:
Academic Education: For those who want to undertake the programme part-time while working with an estate agent. Duration 3 years part-time.
Financial Management: For those who want to take the initial part of the training full time. Duration: 2 years.
Next you need to work in a real estate business while completing courses in three further subjects ‘Revenue and financing of real estate’, ‘Assessment and sale of real estate’ and ‘Real Estate’.
There are also other ways to become an Danish estate agent, for example:
Supplementary education for academics: If you already have a Master’s degree, you can supplement with an education to real estate. Duration: ½ -1 ½ years part-time depending on academic training.
After the training, you can apply for admission to the real estate register of the Enterprise and Construction Authority and for membership of the Association of Danish Estate Agents. Once you are trained as an estate agent, you can further educate yourself as a valuer.
To someone accustomed to the British gung-ho, cowboy-style buying and selling of homes by a motley assortment of snake-oil salesmen, this is like something from another planet.
And for anyone even thinking of mis-selling the odd financial product to the unwary, Borgen regulates the Danish mortgage industry tightly enough to make the average shyster tired by just thinking about any funny business. And then it puts a woman in charge, Ane Arndt Jensen, sending any remaining Testosterone into space – job sorted.
If you are one of those geeks, who actually know their covered bonds from their collaterised debt obligations, do follow the links and gaze in awe at the staggeringly simple mortgage system the Danes operate. Not only is it more transparent than the space between the ears of your typical UK mortgage salesman, but it’s actually set up in the borrower’s favour. Now, there’s a novelty. On the other side of the mortgage, there’s no shortage of investors – or lenders – so these guys are clearly decently rewarded for their investments too.
For the rest of us mere mortals suffice to know that only a small number of specialised banks are authorised to deal in mortgages, and estate agents are essentially out of the loop. This doesn’t let them off the hook though. Danish estate agents still need to undergo rigorous training in financial management, before they’re allowed to set up shop.
Ane Arndt Jensen explains: “This has meant that no significant market shock has been experienced in Denmark. The Danish mortgage system has proved its reliability of supply – also in times of crisis. Financial systems elsewhere in the world have crashed. The Danish mortgage system has proved robust, because the structure involves very little risk. Accordingly, the mortgage system contributes to financial stability. And the low interest rates have helped Danes get through a number of difficult years, mitigating the adverse effects of unemployment and a subdued housing market.”
So, for Danes who want to buy a home, there’s at least a fighting chance of getting a fair deal.
An Englishman’s home might be his cash cow – for now, but a Danish home will always remain a real hygge hule.
I know what gets my vote. What about yours?