On Thursday I spent time talking to employees in a local super market. They were full of commonsense.
Together they were of one voice that too many people are on the dole and needing benefits. They feel strongly that the world is too tough on those who try hard and turn up for work, and not tough enough on those who prefer to stay at home when there are jobs available. They want a welfare reform that works – not to kick the crutches from the cripple, but to pull the duvet from the idle.
The younger ones face a big problem with housing. They want to climb the property ladder. In today’s conditions that is very difficult. House prices did fall as we thought on this site during the recession, but have been rising again more recently. They remain high compared to incomes. Banks under the new regulatory cosh are no longer prepared to lend 90% or 95% of the value, so buyers need substantial deposits. Mortgage rates for new mortgages are many times the 0.5% base rate Labour boast about, making monthly mortgage payments large for the beginner.
I went on from the supermarket to talk to a group of senior managers from a wide range of businesses. They too raised the house price issue. One of them recommended creating the conditions for a further subtsantial house price fall because he was worried about affordability. The others, all home owners, thought this a dreadful idea. They asked what the political parties thought. I said the parties thought there were a lot of home owners out there! Conservatives proposed removing the tax on first time buyer purchasers, and Labour have now done just that, which will help a little.
We are in bind. House prices are too high in many parts of the country for new buyers without rich or generous parents prepared to pay the deposit. The banks are forced to be more prudent, so many go without access to the credit they need. Any ideas?