Construction boom

 

There is a forest of cranes around London. Street after street is partially blocked by construction traffic and by skips to take away the rubbish from old buildings that are being knocked down or substantially altered. The work is now spreading outwards from the capital. The latest index of future  activity, the PMI, hit 62.6 last month, its highest level since 1997. (Anything over 50 means growth in activity).  New housebuilding is leading the charge, followed by private commercial developments to provide the new offices  companies require as they expand.

The annual rate of increase in house prices hit 11.8% last month. For the first time average UK house prices are above the peak level in 2007 before the crash. This is in cash terms – they remain well down when adjusted for general inflation. In London house prices rose by a massive 26% over the last year. The average price of a home in London is well above  any first time buyer’s reach on a normal income, unless they have other money to put in as a deposit. The government and Bank need to look at how to deal with this.

I welcome the general change in  the UK economy as it resumes its growth path. Manufacturing is up as well as construction and general services. The rate of job creation is excellent, and many more people have now found work after the high unemployment of the 2009 recession.

I still think these buoyant figures suggest that the Bank of England should be taking more action to normalise interest rates after such a long period of rates close to zero.

 

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95 Comments

  1. Mark B
    Posted July 3, 2014 at 6:09 am | Permalink

    John Redwood MP said; “The government and Bank need to look at how to deal with this.”

    The government, no ! The Bank, well, it should do what it thinks is best for the wider economy for the whole of the UK which will produce long term, sustainable growth, not boom and bust to suit political aspirations. It was that self same selfishness of the political class that got us into this mess.

    Let the market decide. It will find its ‘natural’ level without the need for government interference.

    FOR PITY SAKE, LEAVE THINGS ALONE !!!!

  2. Margaret Brandreth-J
    Posted July 3, 2014 at 6:17 am | Permalink

    The houses will still have to be sold and that is a better measure of an upturn in the market. Here in the north the losses people are making trying to sell their houses is enormous and these are the lucky ones . There is a glut of houses up for sale and no buyers. So why are we building more?

    • Lifelogic
      Posted July 3, 2014 at 12:00 pm | Permalink

      There is a glut up north because the governments expensive energy by religion, mad employment laws, high taxes and general anti business policies have killed the jobs up there.

      Other than some of Labours artificial state sector “administration” jobs that is that need killing.

      • Bazman
        Posted July 3, 2014 at 5:45 pm | Permalink

        Why has this not touched jobs down south then? By your ‘logic’. Do they have lower taxes, energy costs and land in the south? If the government had not spent large amounts of benefits and subsidies in the north that part of the country would be in ruins as it was in the early 1990’s. It could be argued that many companies are sucking wealth from the north to the south. Large supermarkets see a large part of their profits come from benefits for example as do power companies and other industries that we cannot live without. These profits end up in the south.

        • Lifelogic
          Posted July 4, 2014 at 4:39 pm | Permalink

          It is because the best jobs in the north are often pointless, parasitic governments ones that is the cause of problem far from the solution. London is booming largely due to non-doms and wealth from abroad. The industries, finance, banking, fund management, services etc. are rather less energy dependent.

          • Bazman
            Posted July 4, 2014 at 10:19 pm | Permalink

            You would think that everyone would move north then by this logic. but in reality what is this statement supposed to mean?

    • bigneil
      Posted July 4, 2014 at 1:35 am | Permalink

      For a start a few thousand are needed for the Syrian refugees that the papers are keeping suspiciously quiet about. I hope these people appreciate what is being done for them and not take the same course as one who came here a few years ago where the woman became too “westernised”, husband didn’t like it, she vanished never to be found. He’s now in jail at our expense.

    • margaret
      Posted July 4, 2014 at 4:42 pm | Permalink

      The Losses are enormous.(grammar) .
      The’ International Business News’ seems to be getting quite excited about you leading the EU way out speak. Do we see a come back John?

  3. Timaction
    Posted July 3, 2014 at 6:40 am | Permalink

    House building away from the capital is to provide homes for the annual 520,000 new arrivals under Tory led Coalition.
    There is no infrastructure to support this growth, overcrowding and congestion misery as waiting lists grow for basic services and education. The cake keeps getting smaller.
    This is a national emergency yet the Government sits on its hands and ignores it, hoping that something will come up or Mr Cameron can engineer a row to show how tough he is to loose the argument as always with the EU.

    • Kenneth R Moore
      Posted July 3, 2014 at 10:40 am | Permalink

      Indeed, many carers for example are complaining about ‘austerity’ and ‘cuts’ in services…when in reality the number of newcomers means there are less resources to go around.

    • Lifelogic
      Posted July 3, 2014 at 12:02 pm | Permalink

      Indeed 520,000 PA & most earning far less than the circa 45k needed for the government to break even on them too. So depressing GDP per cap and wages.

      • Dennis
        Posted July 4, 2014 at 2:17 pm | Permalink

        …and how much more carbon emissions are resulting from this activity and from that continuing extra population when the cap in 2030 is a fixed amount so decreasing the per capita amount for each?

  4. alan jutson,
    Posted July 3, 2014 at 6:42 am | Permalink

    Perhaps now is the time to also look at changing the present stamp duty rate to one thats rather more sensible and fair, so that people will be ready to move rather more freely than at present.

    • Lifelogic
      Posted July 3, 2014 at 9:12 pm | Permalink

      Indeed it is a damaging deterrent to people moving.

  5. APL
    Posted July 3, 2014 at 6:43 am | Permalink

    JR: “New housebuilding is leading the charge, ”

    If your government controlled immigration, we wouldn’t need any new houses. This is what is called mal-investment.

    JR: “fllowed by private commercial developments to provide the new offices companies require as they expand.”

    In the depth of (as you put it recently) the great recession – the rest of the working population know it as a depression – you’d think there would be plenty of empty office space, there certainly is in the regions. Hence we see another mis-investment. A result of the Socialist command economy your Party has refused to dismantle.

    And we all are aware the General election is looming, and your branch of the Party wants to stay in power, so instead of removing the fetters from what is left of capitalist initiative in this country, you are simply trying to goose the figures …… again.

  6. Roy Grainger
    Posted July 3, 2014 at 6:50 am | Permalink

    “The average price of a home in London is well above any first time buyer’s reach on a normal income, unless they have other money to put in as a deposit. The government and Bank need to look at how to deal with this”.

    So you advocate state intervention rather than a market-driven solution ? The first thing to do (and Osborne mentioned it) is to slap a high rate of capital gains tax on overseas-resident buyers, higher than the rate paid by UK residents buying/selling second homes. In new developments where I live (central London) new-build flats are bought almost exclusively by overseas-resident buyers, in fact they are specifically marketed there.

  7. Lifelogic
    Posted July 3, 2014 at 7:05 am | Permalink

    Current interest rates should clearly be more like 3% currently but there is an election coming in 2015. Having said that the bank margins are now much higher, we need higher base rates and some real competition (and better but far less regulation) in banking.

    Odds of a Tory Majority about 5/2 so improving but still rather slim, as Cameron slowly make the odd sensible noise on the EU. All that is needed is a new compass/brain for Cameron. In fact he is out that the existing one will do, he needs to follow the white pointer not the red one on all the major issues – so 180 degree from his current position.

    So no green crap expensive energy subsidy, no HS2, lower & simpler taxes, no climate change act, far less (usually misdirected) oversees aid, far less or no EU, far less government, pay for the state sector similar to the private sector, an NHS that actually works and is paid for as used, fewer employment laws, less equality drivel, fewer daft degrees, school that educate rather than indoctrinate ……..

    • Lifelogic
      Posted July 3, 2014 at 7:17 am | Permalink

      Why on earth are tax payers expected to give £5000 to rich people buying expensive plug in hybrids perhaps costing £40,000+? plus the tax breaks on parking, company car taxes and fuel.

      Power station, to car, to charger, to battery, to motor, to car motion, they are little of no better than conventional £5,000 cars on energy use. Worse when car heating is needed in winter and the costs of the battery production are considered.

      • Jerry
        Posted July 3, 2014 at 11:36 am | Permalink

        @Lifelogic: Totally agree. All electric cars do is move were the pollution is created, same thing happened when catalytic converters became mandatory fitments on CI engines, cleaner air in places like the EU, more pollution were the internal precious metals are sourced or refined.

        • Bazman
          Posted July 3, 2014 at 5:57 pm | Permalink

          The carbon trail. Since when have you or lifelogic ever been concerned or believed in this? Oh! since it fits your argument! Certainly will not apply it fitted a wind turbine and the electricity was used to drive the car. No amount of evidence would convince as you believe you own the facts, a double standard take place when energy costs of producing renewable energy equipment are highlighted, but you do not think that the same thing is true for the fossil fuel industry. It’s not about facts though is it when dealing with the likes of you.

          • Jerry
            Posted July 4, 2014 at 8:02 am | Permalink

            Bazman: …and wind farms, electric cars and PV panels don’t have their own high carbon trails?!…

            Oh and so what, carbon trails only matter if one is welded to the idea that man’s release of CO2 is responsible for what are natural phases within nature (when all the data is examined).

          • Edward2
            Posted July 4, 2014 at 8:24 am | Permalink

            The fact you are ignoring Baz, is that compared to fossil fuels renewables are still several times more expensive even if you count the equipment used.
            And remember most of the the price you pay for diesel and petrol is added tax.

          • Bazman
            Posted July 4, 2014 at 3:51 pm | Permalink

            Coal and natural gas power plants take a lot of energy to build too, and on top of that initial energy deficit, it also takes a lot of energy to mine coal or frack for natural gas, and then transport it in trains or pipelines, etc. With renewables, the wind and the sun are free, so after the production and installation, you’re pretty much done for decades.
            Nobody is arguing that fossil fuels are energy-negative on balance, because they aren’t. But I just want to highlight that there’s a double standard take place when a spotlight is put on the energy costs of producing renewable energy equipment but nobody mentions that the same thing is true for the fossil fuel industry.
            The energy pay back for a 2-megawatt wind turbine that lasts over 20 years is… 5-8 months. It’s a virtuous cycle because the more wind and solar we have on the power grid, the cleaner the energy that is used for manufacturing becomes…
            As I said it’s not about facts in the deniers camp such as yourself and you are trying to make all this a natural phase of nature when the evidence is against this in order to do nothing.

          • Jerry
            Posted July 4, 2014 at 8:59 pm | Permalink

            @Bazman: “Coal and natural gas power plants take a lot of energy to build too”

            It’s not just about build costs, it’s about on going maintenance and the returns on the investment, in other words the Kilowatts, Megawatts or Gigawatts (even Terawatts) generated by each method, and perhaps more importantly what back-up is needed to provide a 24/7 supply.

            there’s a double standard take place when a spotlight is put on the energy costs of producing renewable energy equipment but nobody mentions that the same thing is true for the fossil fuel industry

            That is RICH, the renewable lobby never mention their subsidies or the need to have fossil fuel power stations idling ready to make up demand when the renewable supply fails – doing so sometimes unexpectedly. Also, don’t forget that a lot of fossil fuel power stations have needlessly been shut down

            “The energy pay back for a 2-megawatt wind turbine that lasts over 20 years is… 5-8 months. “

            Even if that statement is correct it is only a fact if and when the wind blows, or doesn’t blow to fast.

            Bazman, I seem to recall you told us once that you are a welder by trade, having worked in shipyards if I recall, considering the skills needed to build wind turbines are similar you would not be currently involved in building such renewable’s by any chance, not that I care but it would make sense of some of your comments?

          • APL
            Posted July 5, 2014 at 7:14 am | Permalink

            Bazman: “Coal and natural gas power plants take a lot of energy to build too,”

            Of course they do. But because of the quality, quantity and consistency of the output ( electrical and heat energy ) you can project a point in the investment cycle when you will break even and start making money.

            With wind power, you make a huge investment up front, get very variable power out, there is insane costs and losses involved in conditioning the multiplicity of power sources into something that could be fed into the grid, and then you find that very often, the wind isn’t blowing at the point when your demand is at its maximum.

            A wind farm has to be subsidised, that’s why rich land owners love them. These people like Cameron’s father in Law, already have the land standing idle – putting a government subsidised wind farm on your land is a guaranteed income where there was little or none before.

            That doesn’t mean the tax payer is getting a good deal, we’re not.

            By the way, I’m not against all renewable generation, I think large scale hydroelectric has potential, if the geography and geology is right.

            Windmills, an utter waste of time and our money.

          • Bazman
            Posted July 5, 2014 at 10:37 am | Permalink

            In many cases the numbers add up and massive falling costs of renewable technology are helping this. Do you disagree where this technology is applicable, economical and viable it should be used? Just shouting that it does not work is not true in many cases across the world and here it does and without subsidies. The weather in many parts of the world is consistent and it can be shown by past evidence how long the payback can be and how much consistent wind is required. Subsidies that despite overwhelming facts and evidence to show this fossil fuel companies also receive. But as I have said you are not about factual evidence. This is not your argument. You are pursuing a different agenda that you have already decided is the truth and no amount of evince will convince you otherwise.

          • Jerry
            Posted July 5, 2014 at 8:28 pm | Permalink

            Bazman: “Just shouting that it does not work is not true in many cases across the world and here it does and without subsidies.”

            The only people doing any shouting are those trying to shut down the debate about the inefficacies of renewable’s, people like you Baxman…

          • Bazman
            Posted July 6, 2014 at 9:38 am | Permalink

            Read my post again about shouting Jerry and comment on it’s factual content as you seem to have forgotten to do this.

          • Jerry
            Posted July 6, 2014 at 7:11 pm | Permalink

            @Bazman: Some factual content from you would be nice!… Oh and you still haven’t answered my question, are you involved in building wind turbines?

          • Bazman
            Posted July 7, 2014 at 5:56 am | Permalink

            In many cases across the world the numbers add up for renewables as technology advances and costs fall competing dirctly with fossil fuels and without subsidy, these are the facts. Do you dispute this or in some way want to stop thir advance? I work for a comany that produces equipment for the gas energy sector not renewables.

          • Jerry
            Posted July 7, 2014 at 1:37 pm | Permalink

            Bazman: “In many cases across the world the numbers add up for renewables”

            Care to name a couple of these countries, and what percentage of their power is provided by each type of renewable, together with their availability 24/7?

            Oh and as you have failed to deign that you are involved on the renewables sector should we assume that you are…

        • Bazman
          Posted July 7, 2014 at 5:53 pm | Permalink

          From today to 2030, it is estimated that about $7.7 trillion will be invested in energy production around the world, with about half of that amount going to Asia where power needs are growing quickly. The good news is that renewable energy soon won’t be “alternative” energy, it’ll be the main course; Bloomberg New Energy Finance estimates that over the next 16 years, the world will go from being about 2/3 powered by fossil fuels to over half of the energy coming from zero-emission sources, with renewables making up over 60% of the 5,579GW of new capacity and $5.1 trillion, or about 65% of the $7.7 trillion of new investment. Asia will account for $2.5 trillion of the total, the Americas $816 billion, Europe $967 billion, and the Middle East and Africa $818 billion.
          Worldwide solar power capacity is 53X higher than 9 years ago. Wind power 6.6X higher
          Maybe you should look at the internet and things such as the Swanson effect. All this will not go away because of your ignorance.
          I do not work in renewables I work for a company that makes and supplies gas equipment. Some components such as valves and thermostats may well find their way into the renewable energy sector, but mainly high pressure gas distribution systems. Got That?

          • Jerry
            Posted July 7, 2014 at 8:59 pm | Permalink

            Bazman: “From today to 2030, it is estimated that about $7.7 trillion … “

            Its not a beauty context, judged on the vital statistics of the contestants wallet, it is about the amount if assured electrical energy that such investment will deliver, one could spent $100 trillion on wind or PV schemes but if the wind don’t blow or the sun don’t shine and not a single Kw of power is produced that investment is money that might have well been burnt literally as dollar notes, at least it would have kept one fireplace or furnace glowing – probably an old fashioned power station furnace that has been banned from burning other CO2 producing fuels…

            Nor are power stations based on biomass an option, not if the international politicos wish eradicate world food shortages, even more so if the Green lobby keep objecting to GM technology, and this before anyone mentions how much CO2 such farming would release to produce enough biomass.

          • Bazman
            Posted July 8, 2014 at 5:45 pm | Permalink

            Obviously the hard nosed investors do not think so Jerry as much of this green technology makes economic sense. In many places the sun does shine and the wind does blow at least enough to make the capture of it viable and to say it does not is not in keeping with the facts. Walney island has so many wind turbines off it shore its difficult to count them. Walney is very rarely not windy. Except when I was kite flying as child. The wind is consistent. When the wind blows to power is sold and used. The economics of it may well be another argument and I would be against it if the subsides where not viable. As I’m sure you would not be in the case of fossil fuels as you insist against much evidence that they enjoy many subsides directly and indirectly. You do not own the facts.

          • Jerry
            Posted July 8, 2014 at 6:50 pm | Permalink

            @Bazman: “Obviously the hard nosed investors do not think so

            No, I don;t suppose they do considering how much money is sloshing around by the way of subsidies and research grants – the return is assured and without a single Kw being generated outside the research lab…

          • Bazman
            Posted July 9, 2014 at 6:21 pm | Permalink

            You just don’t get it do you Jerry!? In some areas of the world renewable technology is viable without subsidy? For example on a small scale say you lived in a very sunny part of the world without electricity and you were to poor to have an electricity supply to charge your phone or provide lighting, you would use solar power and much kerosene and money has been saved and made due to the extension of the working day. You deny this is not happening? It also happens on a larger scale if you look at the facts. Fact that you do not own.

      • Kenneth R Moore
        Posted July 3, 2014 at 12:27 pm | Permalink

        Not to mention the environmental cost of all the copper and rare earth metals and plastics used in there construction. Who is going to want one of these in 10 years time when the battery’s need replacing and they are hopelessly out of date ?.

        Why are taxpayers expected to pay for brand new luxury vehicles for people with ME or slight mobility issues. Tired of hearing now about so and so who has a brand new car and yet he’s fit enough to go on holiday .and play a round of golf. And why free car tax – is it too much to ask that owners make some contribution to the social cost of their vehicle ?.
        Why does government seem to keen to turn individuals into charity cases that depend on the benevolence of the state ?..it does harm to the taxpayer and more importantly more harm to the individuals that have charity inflicted upon them.

        Is there a good and bad CO2 depending on whether the car has a ‘disabled’ driver.
        More muddled thinking.
        Soft touch Cameron has been in charge now for 4 years and he’s still allowing this farce to continue.

        • Bazman
          Posted July 4, 2014 at 3:56 pm | Permalink

          The argument is that a disabled person has higher living costs in particular travel and mobility costs through no fault of their own and in a civilised society this should in compensated for whatever their income or their ability to work. All parties agree on this principal.

  8. alan jutson,
    Posted July 3, 2014 at 7:33 am | Permalink

    As interest rates rise (as they will) from their artificially low level, and as the new more sensible mortgage loan ratio’s kick in, you may find that the construction boom will be rather short term as prices once again level out or drop.

    If we ever manage to get control of our borders and immigration policy/numbers, we may also see demand slow a little for not only housing, but also water, schools, hospitals, and sewerage plants, etc..

    You will never get rid of the risk of boom and bust (reminder to Gordon Brown) but what you can do by careful management of the economy, is to try and control the very high peaks, troughs and time cycles with sensible, rather than extreme, fantasy, and panic type policies, of mortgage backed guarantees, high stamp duty rates, and a false bank/mortgage rate levels which have twisted the market from historical reality.

    • Jerry
      Posted July 3, 2014 at 3:26 pm | Permalink

      @alan jutson: “As interest rates rise (as they will) from their artificially low level, and as the new more sensible mortgage loan ratio’s kick in, you may find that the construction boom will be rather short term as prices once again level out or drop.”

      Why, it will just mean more will be rented rather than sold, a cap on montages doesn’t change peoples need to have a place to live, just who owns it.

      • alan jutson,
        Posted July 3, 2014 at 4:29 pm | Permalink

        Jerrry

        ….”>>>>more will be rented……”

        Indeed perhaps that will be the case, and those who cannot afford the new mortgage rates may well add to their numbers.

        Whilst I agree demand will keep prices up to a degree, those who would like to move up may well not be able to do so due to the higher mortgage rates, new affordability criteria, and stamp duty costs.
        Thus we may start to have a dysfunctional market for some time.

        Do you really think the present/new landlords will take up all of the new and repossessed available houses given housing benefit is being looked at and capped..

        • Jerry
          Posted July 4, 2014 at 8:18 am | Permalink

          @alan jutson: “Thus we may start to have a dysfunctional market for some time.”

          Many would say that is what we have had for some time now, that we are actually (finally) entering a period of correction, house builders/landlords will tailor their new build/renovations to what the market can afford.

  9. oldtimer
    Posted July 3, 2014 at 7:43 am | Permalink

    The Bank must have read your blog post for Cunliffe, a Deputy Governor, appeared on BBC Breakfast to say the Bank was concerned about the build up of private debt accumulated to fund house prices above peoples` ability to afford, thereby risking another credit crunch.

  10. acorn
    Posted July 3, 2014 at 7:45 am | Permalink

    I suppose it is natural for the media, with its limited understanding of economics should concentrate on a few broad “metrics” like BoE “bank rate”; “GDP” and “FTSE 100″. Once upon a time the “trade gap” was all the thing.

    Also, it helps to fool the voters by always quoting “rates of change” rather than absolute values. The UK is currently climbing out of its GDP hole, faster than anybody. It doesn’t tell you that most of our competition, got out of the hole two or three years back while we were austeritised to the bottom of the world GDP hole.

    M4 is the main broad measure of the money supply in the UK. The central bank’s preferred measure excludes economically irrelevant financial transactions of which there is uniquely a large amount [Spiv City of London] in the UK economy. (HT Haver Analytics and Econoday)

    “M4 contracted again in May. A 0.1 percent monthly dip was in line with expectations but still the third in a row and left the broad money aggregate 0.9 percent below its year ago level after a 0.6 percent fall last time.

    However, the BoE’s preferred measure that adjusts for distortions caused by other intermediate financial corporations told a rather different story. Hence, the modified money gauge saw positive monthly growth of 0.3 percent after a 0.4 percent increase in April for a yearly increase of 3.6 percent. Even so, the annualised quarterly rise was only 2.7 percent, down from 4.5 percent last time and the second lowest print so far this year.

    Elsewhere in the financial data mortgage approvals fell for a fourth straight month in May and at 61,707 were 1.7 percent short of their level at the start of the quarter. At the same time the cost of borrowing was also higher with the effective average rate on new mortgages creeping up from 3.07 percent to 3.13 percent, its highest mark since August 2013. However, if the housing market is starting to cool – and the evidence here remains very mixed – there are renewed signs of life in the corporate sector with loans to non-financial companies up Stg3.41 billion on the month, their steepest rise since the data were first compiled in 2011. Consumer credit was also a little firmer, expanding Stg 0.74 billion after a Stg 0.65 billion increase last time.

    Now, this next bit, tells you the un-politicised truth:-

    “The ongoing sluggishness of M4 remains one of the major question marks hanging over the durability of the UK economic recovery. Still, if the pick-up in corporate borrowing last month is the start of a new trend, the implications would be that the upswing in activity has gained sufficient traction to be deemed sustainable and, if so, the pace of monetary expansion should follow suit.”

    • acorn
      Posted July 3, 2014 at 5:00 pm | Permalink

      JR; the Tea Party on the top back rows behind the Treasury Bench ( the Daily Mail / Express wing of the party), seem to think Osbo’ and IDS are “slashing” the welfare benefits budget. As always, “empty vessels make the most noise” as my late mother would say.

      Reality is different (unchecked link removed – pl say what you want to say in your own words ed)

      The point I wish to make is that Osbo’, has basically abandoned “austerity” for this parliament. The big worry is, what he will do if he gets re-elected. Three years slash and burn the public sector would be normal for a new Conservative government. It will kill the economy stone dead.

      Have a look at the first of Neil’s charts. You will see that you could project the blue government deficit sector to zero by about 2015. The original plan A. By the second quarter of 2012 Osbo’ gets told the error of his ways by wiser heads. He is now holding his government’s deficit spending a circa 6% of GDP.

      Whether a 6% GDP deficit, will get UK plc to lift off the runway before the election is … er … a good question.

    • Mark
      Posted July 4, 2014 at 10:00 am | Permalink

      “The ongoing sluggishness of M4 ” suggests we ought to aim for an 80mph speed limit.

  11. Lindsay McDougall
    Posted July 3, 2014 at 8:40 am | Permalink

    Between the 2001 and 2011 Censuses, London’s population increased by 1.0 million overall, in spite of ‘white flight’ of 0.6 million. Immigration has continued at between 100,000 and 212,000 in each year since then, no doubt mainly to London.

    The spate of building in London, the high house house prices, and the pressure applied by Messrs Pickles and Boles to rural District Councils to accept more houses, all owe a lot to the knock on effects of excessive immigration.

    Question: What will the level of net immigration be after 2017, when you ought to have full control? I have tried since February to obtain quantification from Eric Pickles, Theresa May and my MP James Arbuthnot. I at long last got a letter from Eric Pickles dated 6th June, addressed to James Arbuthnot and copied to me by James. Mr Pickles cites two ONS web sites but says the projections are ‘politically neutral’ – i.e. they are not explicitly Conservative Party policy.

    Perhaps John Redwood will have better luck. I think that pro-European Tory Wets need to have their feet put to the fire.

    • Hope
      Posted July 3, 2014 at 1:31 pm | Permalink

      Your figures are too low even by ONS standards. The is no real way to count people in and out of the country. After four years one would like to think a competent government might achieve something towards its promise. Secondly, on the figures produced immigration is over 500,000. Of course, the government has NO control over who wishes to leave, but it could exercise restraint and control over the quality and quantity of people wishing to live here. It chooses not to have any sensible control over immigration. The EU determines who can come here. The UK government exercises open borders with a direct threat to our national security as a consequence.

      Cameron’s claim that the EU arrest warrant would prevent terrorism is an absolute nonsense, and he knows it, it also gives away national sovereignty to foreign powers who exercise Napoleonic laws over UK citizens. This is contrary to his claim to prevent ever close union. His actions, once more, show the opposite of what he says to be true.

      Now it is reported Cameron wants to borrow and give away UK taxpayers’ money in overseas aid enshrined in law. How about consideration for the people who live here and pay their tax?

      • Mark
        Posted July 3, 2014 at 3:50 pm | Permalink

        I have a very simple way to count people in and out of the country. Tell the airlines and ferry companies and Eurostar to report the inbound and outbound passenger numbers every month, and add them up. OK, it would miss out on stowaways and small numbers of non-commercial travellers in private craft, and might not capture any significant flow across the Irish land border – but ferries to the UK mainland from Northern Ireland might provide a clue. Holiday makers and short term business trippers would soon wash out of the net numbers as they go/return home.

        I presume the reason this hasn’t been done is because of a desire to maintain obfuscation about migration data. With little more effort, the numbers could be broken down by destination/origin – if not by the breakdowns used by the official statistics. But they would provide control totals to guage the inaccuracies in the numbers that are estimated from the International Passenger Survey.

        • alan jutson,
          Posted July 3, 2014 at 4:35 pm | Permalink

          Mark

          All you need to do is swipe passports when going out and when coming in, it a’int difficult. because everyone should pass through passport control when going both ways.

          You could even make it simpler by walking through a beam as you go through passport control, if swiping a passport is too difficult.

          • Mark
            Posted July 4, 2014 at 2:40 pm | Permalink

            I think I trust the airlines and ferry companies to count their passengers more accurately than UKBA would ever manage.

        • Lifelogic
          Posted July 3, 2014 at 9:14 pm | Permalink

          Indeed they clearly do not want figures to be available.

      • Lindsay McDougall
        Posted July 5, 2014 at 9:28 am | Permalink

        There is a clear difference in the viewpoint of Eurosceptics and pro-European Tory Wets. Eurosceptics insist that after 2017 we will either have voted in a referendum for renegotiated terms that give us full control over our own borders or will have voted OUT. Either way, we will have full control over the numbers of immigrants after 2017.

        Pro-European Tory Wets on the other hand don’t want to take the slightest risk of exiting the EU and are prepared to allow EU control over our level of immigration in perpetuity.

        While I am on the subject, increasingly would be non-EU immigrants who have been rejected by the UK are using the back door method of gaining entry. This is to apply for citizenship in countries like Malta, Italy and Greece and, after acceptance, transfer to the UK as of right. These countries can make money out of this process and don’t have the UK’s interest at heart.

  12. Bert Young
    Posted July 3, 2014 at 9:02 am | Permalink

    Quite agree . Interest rates are out of balance with the growth in the economy and , certainly , there is little correlation between wages and property prices . The Governor has twice given notice of the intentions of the Bank of England to ” take the heat out ” – even though the indicated rise in rates will still be very low . Savers have been given very little cheer from the indications of the High St. Banks – all indicating incentive levels more likely to drive money elsewhere . What does impress me is the outlook and performance of our manufacturers ; the markets are there for them to exploit and they are more than holding their own in price competition ; I hope the Banks develop their business with them .

    • Lifelogic
      Posted July 3, 2014 at 10:23 am | Permalink

      The banks are useless they like to take in deposits paying say 0.1% interest (negative in real terms) totally unsecured and then want to lend out at say 5%-40% well secured, to clients. Clients who are often a far better credit risk than the bank itself. They are not really interested in lending to industry much, more in wealth management (or gambling) with your money and taking a cut if you win or indeed if you lose.

      Cut out the middle men if you can and please get some real competition in banking and lending.

  13. Alan Wheatley
    Posted July 3, 2014 at 9:02 am | Permalink

    Although “The average price of a home in London is well above any first time buyer’s reach on a normal income, unless they have other money to put in as a deposit” is clearly an issue for such people, is it really a problem as seen from a nation-wide perspective? Just what is it that the government and the Bank need to deal with?

    Those who can not afford to buy in London can look to buy where property is cheaper.

    One thing that should definitely NOT be done is to take action that treats the “London Problem” but in so doing makes things worse for the rest of the country.

    And it should be remembered that price inflation can be countered by reducing demand, an option that none of the media commentators give even the merest consideration.

  14. Anonymous
    Posted July 3, 2014 at 9:24 am | Permalink

    One strikingly obvious thing is that overcrowding forced up rents. Increased rents put up the interest among overseas investors for London rental property – this put property out of reach of ordinary people. (Houses at 10x income – more – is NOT normal)

    So the answer is to build, build, build… and keep on building ?

    And then what ?

    You cowards.

    • APL
      Posted July 3, 2014 at 11:48 am | Permalink

      Anonymous: “You cowards.”

      Spot on.

    • Kenneth R Moore
      Posted July 3, 2014 at 12:02 pm | Permalink

      They are all cowards – This country had a golden future before it but it’s all been thrown away – not threw carelessness but through deliberate acts of spite.

      The mess we are in has been carefully engineered. How many of the elite have to wait in line for NHS treatment or a doctors appointment. Or get a place for their child at the local comp. Or get told they are 1,516 in line for social housing.
      Very few. To them mass immigration means better GDP and job figures and cheaper nannies. End of story.

      They are also irresponsible and can’t do simple maths as it seems they cannot grasp something as simple as the exponential growth function. On present trends the population will double in about a lifetime…and then go on increasing as the birth rate amongst the newcomers will stay high for cultural reasons.

      The trouble is the government thinks it owns the system and can do whatever it likes. The idea that they are just custodians for a short while is alien to them.
      Arrogant fools.

      • Jerry
        Posted July 3, 2014 at 4:06 pm | Permalink

        @Kenneth R Moore: “Or get told they are 1,516 in line for social housing.”

        What socail housing, there is very little left, most was sold off El Cheapo in the 1980s, ho-hum!

        Does any one have the figures for house building (public and private) against LA housing stocks in each of the decades between 1950 and 2010, even without migration [1] it could very well be the case now that someone needing socail housing could still get told that they are 500th on the housing list – that could still likely be a 10 year wait considering average “churn”. But of course there are plenty of BTL rents in the sector, only trouble is many cost as much to rent as the mortgage payments would have cost, had it not been turned down. In fact I wonder if the books are so toxic on BTL loans, after a decade or so of bloat in the sector, that it is felt that banks need to actively protect the BTL rental markets?

        [1] not just immigration, people do move around their own country, someone getting a job in London when they live in Newcastle will likely need housing in London

        • Hope
          Posted July 3, 2014 at 5:29 pm | Permalink

          No, you are incorrect. Affordable and social housing forms part of every development over 15 houses. Most authorities require 25-35 percent of every new build to be affordable and social housing. This is how housing is found for the mass immigration policy. Cheap labour cannot afford housing otherwise. No housing problem, it is an immigration problem. JR ought to come clean and include it in this type of blog. The real question is why Cameron is not providing the infrastructure to match his immigration policy. All our quality of lives suffer as a consequence because of his lack of strategic ability.

          • Jerry
            Posted July 4, 2014 at 8:32 am | Permalink

            Hope: “Affordable and social housing forms part of every development over 15 houses. Most authorities require 25-35 percent

            Forget affordable, there is no such thing for someone who can’t get a mortgage, thus that leave social, something that there is a lack off, hence why there is so much BTL, do you really think that private landlords would be investing in BTL if the market was swamped with true socail housing and thus much lower rents were achievable?!

            @Hope: “This is how housing is found for the mass immigration policy.”

            NO, you are wrong, this is how housing is funded for those on NMW type wages, mind you don;t bump into that elephant standing next to you!

            Even before the mass selling off of the council housing stock in the 1980s people were facing long waits on socail housing lists, perhaps you never circulated in such circles back then “Hope”, or perhaps you think that the 1960s and ’70s were also eras of mass migration too?

          • Lifelogic
            Posted July 4, 2014 at 4:45 pm | Permalink

            Indeed affordable house is in effect yet another tax on workers houses for those who do not get social housing.

            Not “key” workers or single parents perhaps just workers.

        • Anonymous
          Posted July 3, 2014 at 10:50 pm | Permalink

          People have always moved to/from London.

          We’ve added 5 million to our population in a decade. This has an effect on all housing provision.

        • Anonymous
          Posted July 3, 2014 at 11:23 pm | Permalink

          People have always moved to/from London.

          I watched Question Time on the housing crisis this evening.

          Peter Hitchens raised the issue of mass immigration otherwise it would not have been mentioned. For this he was personally attacked by the audience and by panel members.

          This level of denial is bizarre and disconcerting.

          There will never be enough housing. So the economy runs on housing bubbles. This is exactly how they want it.

          • Jerry
            Posted July 4, 2014 at 8:48 am | Permalink

            @Anonymous: “There will never be enough housing. So the economy runs on housing bubbles. This is exactly how they want it.”

            But there could be, and as there is only one thing more important to societies well being (health being the first) should socail housing be left to the whims of the free market to decide, the Tory governments both before and after WW2 didn’t think so so perhaps a little more “Back to the Future” might again be in order. I know it is considered a dirty word these days but perhaps this is one area were a little Keynesian economics might not go amiss, it would certainly make more sense than the £bns that projects like HS2 and HS3 are going to cost to try and kick start the economy.

          • APL
            Posted July 5, 2014 at 7:26 am | Permalink

            Jerry: “But there could be, ” [ enough housing ]

            How so Jerry when the government permits unlimited immigration?

            If you have unlimited immigration, by implication you have unlimited demand for accommodation.

            Some of that demand will be addressed by the private rental sector* – some of that will be subsidised by the local authority paying the rent of immigrants.

            But with infinite demand and limited supply – largely constricted by local planning restraints – prices will rise.

            And that’s just housing. There is the sewerage system, the road infrastructure, the water supply system and the energy supply system.

            All of which were build predicated on a populations level projected in 1970 which never took into account the massive influx of immigrants that we have seen.

            *We have already seen the results in London suburbs where every garden has a shed or extension where half a dozen people are living in less than ideal conditions.

            http://www.theguardian.com/society/2012/may/09/london-landlords-desperate-tenants

            Rationalize that away, Jerry.

          • Jerry
            Posted July 5, 2014 at 9:24 am | Permalink

            Apologies to John for the long reply.

            APL: “But with infinite demand and limited supply – largely constricted by local planning restraints – prices will rise.”

            Nail, head… The problem is that house bricks have become investment opportunities, but only if demand outstrips supply, hence the lack of socail housing builds, hence the NIMBY planning objections even those many objecting live in housing built in the post war era that also changed the locality in the same way as those who are objecting today.

            Then, to deflect from this investment self interest [1], when ever anyone points to the elephant standing in the room people on the right come out with the same old clap-trap about it’s all the fault of the migrant, as if a few million migrants [2] (out of a total UK population of ~64,100,000) are going to tip the balance. Even if migrants do tip the balance it just proves how fragile or non existent proper government/LA planning has been in the last 30-40 years, up till then we did plan for the Baby-boom generation, never mind the need to replace old out of date housing stock (not just slum clearance), but since then there has been little planing for the needs of the children of the Baby-boom generation, hence we now have a housing shortage etc.

            APL: “And that’s just housing. There is the sewerage system, the road infrastructure, the water supply system and the energy supply system. “

            That didn’t seem to be a problem up to the late 1970s, indeed many who were living in those old small towns and villages that have been swallowed up by the post war new towns might have wished it had, not did it stop the pre war Garden Cities, nor has the energy supply system stopped the endless march of railway electrification or other commercail uses of this precious energy resource that could again be fixed by proper planning, as it used to be.

            I’m no fan of EU open boarders but I object to blaming migrants for every ill under the sun it seems because doing so just hides the real problems. The same housing problems were existent in the late 1980s and in the 1990s, long before the current influx of migrants from the east and south of the EU. The elephant in the room will still be there even when the elephant passing the window has returned to its usual grazing pastures (probably mixing my metaphors but never mind!).

            Also, until we start telling the kids and youth of today that they probably won’t be the next Bill Gates or who ever, that they will more than likely end up in a dead end job working 8hrs pd doing repetitive or physical tasks employers will carry on attracting and employing such migrant labour. Only this week I heard a (Labour) MP on the Floor of the House say that kids need to be told that “if they work hard at school they can do anything they want” job wise, when the message should be ‘Work hard and you will fulfil your true capabilities’, that way kids might keep a realistic outlook and be more prepared to the sorts of jobs that attract such migrant labour now?

            [1] by both owners and builders as it keeps (re)sale values high, and in the case of the builder, increases the profit margin

            [2] and perhaps just a few hundred or thousand in any given area

          • APL
            Posted July 7, 2014 at 9:17 am | Permalink

            Jerry: “The problem is that house bricks have become investment opportunities,”

            No that’s not the problem. That’s the symptom.

            Jerry: “people on the right come out with the same old clap-trap about it’s all the fault of the migrant,”

            You have just identified a number of issues that constrict supply of housing. OK, I don’t disagree, but I don’t agree with all of them.

            But in order to protect your holy sanctum, you dismiss the most critical point. The population of the UK has risen from 50,000,000 to 70,000,000 at the same time as the government ( party for both have encouraged the trend ) has encouraged the atomisation of the family.

            So demand for single occupancy accommodation has sky-rocketed, at the same time as the population has been artificially augmented by large scale immigration. Either of those two trends alone would have caused a housing shortage – and since it seems we agree on the law of supply and demand at least – if follows that the price of property has gone up.

            THAT, is what has encouraged people to think property as an financial speculation.

            Try to put the horse before the cart once or twice, Jerry.

            Jerry: “That didn’t seem to be a problem up to the late 1970s, ”

            Because the projections of population and the infrastructure projected completing in the ’70s had been planned in the 50’s.

            Guess what? In the 50’s the projections didn’t include the atomisation of the family, nor the massive influx of an utterly new population.

            Jerry: “could again be fixed by proper planning, as it used to be.”

            So you agree, the planning was wrong ….. next question why?

          • APL
            Posted July 7, 2014 at 9:36 am | Permalink

            Correction:

            according to WIKI the population of the UK was
            1950 — 50,000,000
            1960 — 52,000,000
            1970 — 55,100,000
            1980 — 56,000,000
            1990 — 57,000,000
            2000 — 58,000,000
            2010 — 62,000,000
            2014 — 64,000,000.

            So, between 1950 and 2000, the population of the UK was on a gentle uptrend. Capital infrastructure projects planned in 1970 would have still been working within projected parameters in 2000.

            In the fifty years between 1950 and 2000, the population had grown by only eight million. That’s a period of fifty years!!

            The huge jump in immigration has come between 2000 and today, a massive six million more in the population over a period of fourteen years.

            http://en.wikipedia.org/wiki/Demography_of_the_United_Kingdom

            In an article entitled “construction boom” it would be stupid to dismiss the population growth trends.

            According to the wiki article, the ONS projects the population to rise to 73,000,000 by 2035

          • APL
            Posted July 7, 2014 at 9:51 am | Permalink

            Jerry: “as if a few million migrants [2] (out of a total UK population of ~64,100,000) are going to tip the balance.”

            But it’s not a few, Jerry. Nor should you ignore the time frames involved either!

            Eight million population growth in the fifty years to 2000. I’d be prepared to characterise that as gradual.

            A further six million in fourteen years is not gradual.

            The infrastructure planning never envisaged such an explosive growth in such a short time.

            Given that an large infrastructure project might take ten or fifteen years to plan and build – I’d even go so far as to say it is impossible to cater for growth in population of that magnitude over that time frame.

            Eight million people in fourteen years. When planning and constructing power generating plant takes ten years.

            That is INSANE.

          • Jerry
            Posted July 7, 2014 at 5:47 pm | Permalink

            Covering a sample of comments made by APL over several replies to my previous comment above.

            @APL: “[housing investment bubbles] No that’s not the problem. That’s the symptom.”

            No, it is the problem. Shortage of supply tends to keep prices high, its the same what ever the product is, the only other way to make money is to sell houses like supermarkets sell baked beans, build/buy in quantity, taking advantage of the cost saving in doing so, and then sell at a price point that is VFM that assures quantity sales, end profit being made on the total development -except that there hasn’t been those very large post war style housing projects in recent years.

            @APL: “So demand for single occupancy accommodation has sky-rocketed”

            Indeed, and most of those single single occupancy accommodation is required for the British Born and breed man or woman, and why is there a shortage, because socail dynamics that should have been picked up upon by governments were not.

            @APL: “In the 50′s the projections didn’t include the atomisation of the family, nor the massive influx of an utterly new population.”

            But it did, perhaps not enough but it did none the less, hence why we got the New Towns that were not just about slum clearance, many of these New Towns were still in the process of construction (complete with Development Corporations) well into the 1970s and because they had proper centralised planning they could and did adapt to the changing social tide.

            @APL: “But it’s not a few, Jerry. Nor should you ignore the time frames involved either! … A further six million in fourteen years is not gradual.

            But they didn’t all turn up at once, nor all move to one location, it would be quite possible to build enough new homes in that time scale, yes it would have been a major undertaking but not impossible, but of course not if one was already starting with a deficit of housing stock for the existing population!

            @APL: “Given that an large infrastructure project might take ten or fifteen years to plan and build – I’d even go so far as to say it is impossible to cater for growth in population of that magnitude over that time frame.”

            Oh nonsense, exactly that sort of planning and building was carried out in the 30 odd years after WW2. Also there is no need for major infrastructure projects to take that long, for example “Sizewell A” took a mere 5 years to build from the first sod being turned for building to generating its first Kw of electricity, so even with planning that should be well under 10 years and probably a lot less. A conventional coal, gas or oil fired power stations will take a fraction of that time.

            So once again, the true problem is the one that no one seems to wants to see, namely the elephant called “PLANNING” standing in the corner of the room.

  15. Mark
    Posted July 3, 2014 at 9:44 am | Permalink

    The London boom is entirely dependent on the continued inflow of foreign speculative money. The only measure the Bank of England could take to halt that would be to impose inward capital controls – hardly something it would otherwise wish to do. Therefore it falls to government to deal with via taxation and law aimed specifically at foreign property speculators. The Channel Islands have such laws already – they strictly limit the properties than outsiders may purchase or rent, and create separate markets for outsiders and citizens, with different taxes. Similar laws can be found in e.g. Singapore.

    The existing taxes do not seem to be a deterrent – including SDLT at 7% on £2m+ properties and even 15% where the property is owned by a company, and the limp threat of CGT that will be based on property values next April, and the Annual Tax on Enveloped Dwellings (properties owned via companies) worth over £2m – a mansion tax in all but name that runs to £140,000 p.a. on £20m+ mansions.

    The downside is that having created a London centric boom there will be an inevitable London centric bust. It is notable that some of the most expensive properties for sale are now reported as having their prices slashed: the smart money is beginning to smell the market peak may not be far off.

    • Anonymous
      Posted July 3, 2014 at 10:52 pm | Permalink

      Mark Carney is worried that the economic recovery is at risk from the housing bubble.

      The economic recovery IS the housing bubble. Deliberately and dangerously stoked to fool the people.

  16. Iain Gill
    Posted July 3, 2014 at 10:52 am | Permalink

    You know a hard nosed gritty realism is an election winning approach, glossy stuff that everyone can see through may sound good in the political set but just frustrates the rest of us

  17. waramess
    Posted July 3, 2014 at 11:22 am | Permalink

    A consumer led bubble does not equate to growth; it creates a series of other bubbles.

    House prices up as landlords bid furiously for rentable houses in London and elsewhere increases building activity which stimulates associated manufacturing but it also fuels imports and leads to a massive deficit in the balance of payments.

    At some point soon the building boom must end as rented properties become too overpriced for rents to sustain the servicing cost, and then what?

    Only consumption fuelled by growth in productivity will sustain, and for that government needs to stop spending, reduce in size and, get out of the way of the private sector.

  18. Mark
    Posted July 3, 2014 at 11:49 am | Permalink
  19. Posted July 3, 2014 at 11:51 am | Permalink

    The stats on property prices are totally distorted by the London market and if you dig deeper you find that there is really no great increase in prices elsewhere. Houses and flats remain relatively affordable elsewhere, certainly no worse than in previous decades and in many cases more affordable.

    Nobody should want to see business growth in London restricted artificially. Instead the government should be doing more creative things to promote growth in the regions.

    I live in the South near Ringwood Hants but I can see that we must do more to help the North of England, particularly our great cities such as Liverpool, Leeds and Manchester.

    One would have thought companies would naturally take advantage of cheaper land and lower wages in these areas but they seem to be fixated on expanding in the South, especially London. It can only be because of the proximity to the Channel Ports.

    Aviation links should be easy to fix but rail and road links are a problem.

    It’s almost as if we need a dedicated Motorway from Manchester and Leeds that goes straight to the Channel ports via Birmingham and the East coast and misses out London. Perhaps it could also have a second sweeping curve that went South of London and linked Brighton and the M3 with the Channel ports. I’ve frequently mentioned the real need for a motorway link from Southampton to Exeter and into Cornwall.

    A double decked super highway with dedicated truck and bus lanes in the lower deck would be of far greater value than HS2 in this respect. It would be a great deal cheaper and used by a far greater proportion of the population. I would have no objection to it being a toll road either, as long as the toll was restricted to covering costs and not yet another way for the Treasury to bleed the motorist dry.

    If we must have rail, perhaps instead of HS2 we should be building a link from the HS1 station at Ashford that goes direct to Birmingham and all points North.

    Finally, soft loans and long periods without being charged business rates would be start in promoting the regions. Quite how you level the playing field for existing businesses, I don’t know but we have to do something creative.

    • Mark
      Posted July 3, 2014 at 3:40 pm | Permalink

      I think you have a fairly odd idea about the trends in house prices in the regions. Everywhere has seen prices rice by at least a factor of 2.8 times since the lows of the mid 1990s according to Nationwide data. RPI inflation over the period is only a factor of about 1.7.

      • Posted July 4, 2014 at 3:55 pm | Permalink

        As a recently retired IFA I have been arranging mortgages for more than 40 years.

        RPI Inflation is not the only factor you have to consider : wage inflation is what affects affordability as do interest rates.

        We are now in a totally different financial situation from before : low interest rates are here to stay and the mortgage market will once again become hyper competitive.

        If only those people coming to see us for morgages were not burdened by car loans, credit card bills and every other kind of debt which they have used to fuel their lifestyle, they would find properties more affordable than they have been over the majority of my career.

        Back in the 70s mortgage rates were 8-15% and a 25% deposit was often required. many applicants now want to buy on their own and outside the cities often they want a house and not a flat. This has never been a practical proposition, two incomes have almost always been necessary.

        With the advance of equality, for the average couple, the second wage is substantially more than it would have been even 20 years ago and this makes a dramatic difference. Also, applicants are now in their late 20s or early 30s and they are much higher on the general income scale.

        • Mark
          Posted July 5, 2014 at 9:35 am | Permalink

          I do not share your confidence about low interest rates lasting for anything much more that a few years. There are very good reasons why Sir John Cunliffe expressed concern about excessive levels of mortgage borrowing. Coming off such a low base, increases in interest would be utterly crippling for many – which is not a reason they won’t happen. Of course, the financial industry would like to grab as large a share of people’s incomes as it can – but it really isn’t sustainable when it prevents people from saving for retirement, and leaves them financing regular expenditure by remortgaging on ever larger sums. That way lies national bankruptcy – as the borrowing is in practice funded abroad via the banking system.

  20. Max Dunbar
    Posted July 3, 2014 at 1:00 pm | Permalink

    London house prices and the suburbs of London may be exploding but London is effectively a country within a country.
    The contrast in Scotland is remarkable. With the possible exception of Edinburgh and Aberdeen, prices here appear to have fallen, and taking inflation in to account have fallen further. Properties that would have sold quickly a few years ago are taking much longer to shift and not achieving the prices that the owners anticipate. In the better areas of Glasgow such as the west end, the majority of sales have been to public sector professionals like doctors. As with most of Scotland’s economy it is driven by the state.
    The prospect of a separate Scotland has undoubtedly harmed business confidence and this is also reflected in property values and especially in commercial property which is not subject to government manipulation to the same degree as domestic accommodation. This therefore gives a clearer picture of the health or otherwise of the local economy.

  21. ian
    Posted July 3, 2014 at 5:40 pm | Permalink

    I don”t know why you ask john. It all printed money. The hole of US is build on printed money since 1913 it call the fed. The US has not paid back a cent, every thing you see is build on printed money. China is now the biggest printer in history, japan massive printing coming. The fed won both world wars on printed money. Before the fed came along you had real growth 6% 10% percent a year, now you just have inflation. In china a person sits at the computer and buys a flat in london with printed money or it might be US, they do not let the property out so you have to build more and the price go”s up. When you take out any type of loan you are printing money. Help to buy and government business loans or any think the government offers you is printing money.

    Companies sell bonds or borrow money,printing money, companies buy back shares that the growth you see now. There is just printing money and inflation that it.

    Every time you buy a house ,car, uni you name it it printing money if you do not pay for it out of saving or your wages. The thing is now your wages do not go up. Most companies books are a joke, when was the last time a big companies books were look into. Take banks, nobody would know were to start that it the big joke.

  22. ian
    Posted July 3, 2014 at 7:40 pm | Permalink

    You should see what christine lagarde and IMF have got in store for you. By the way china has done money printing before and failed,many years ago.So they are the experts at this game, long before the fed.

  23. bigneil
    Posted July 4, 2014 at 1:41 am | Permalink

    - – -this doesn’t make sense john. – – – – -On Wednesday afternoon -outside my local hospital, got talking to 3 Portuguese who worked there -also said there was 7 others – then added Spanish and Italian were coming there later this month. After they had gone for a while I was talking to an English lady – qualified nurse she said – – -who couldn’t get a job . . .??? – -aren’t people getting sick in their 3 countries?

    • Jerry
      Posted July 4, 2014 at 8:58 am | Permalink

      @bigneil: Perhaps this English lady wasn’t as qualified/experienced, perhaps she wanted to much money – just saying…

      • APL
        Posted July 5, 2014 at 7:37 am | Permalink

        Jerry:

        Possibly. But my experience having been made redundant after twenty five years in IT, is that there is no IT skills shortage, the sector is cut throat, and my scenario hasn’t been improved by the ICT visa’s. I have seen loads of folk working at the bottom end of the sector, who may or may not have a degree from Lahore University – but the work they are actually doing doesn’t warrant a degree, and that position could probably be filled by a domestically educated individual.

        If you think I am asking too much money, I have worked for the minimum wage over the last three years. And am currently on a zero hours contract and have been offered four single day contracts in six months from a particular agency.

        Your comment, “she wanted to much money – just saying…” is spoken like someone using the wrong end of his alimentary canal to communicate.

        • Jerry
          Posted July 5, 2014 at 9:39 am | Permalink

          @APL: “Your comment, “she wanted to much money – just saying…” is spoken like someone using the wrong end of his alimentary canal to communicate.”

          No, it comes from someone who has, after 37 odd years experience, now had to go down the Self Employed route and find my own work, I have had to change my career path more than once within my own trade and when work has become slack or even non existent -I work in an area of the economy that is often the first to suffer when spare money becomes tight and discretionary spending stops- I have taken jobs outside of my trade/training. So please, less of your snide comments about what I know, I likely have more worldly knowledge about employment prospects that you do, and this might be why I’m less than impressed by those who bleat about migration taking all the jobs, after all I saw it all in the 1970s when the National Front used to say much the same – just saying…

          • APL
            Posted July 6, 2014 at 11:55 am | Permalink

            Jerry: “So please, less of your snide comments about what I know, ”

            If you restrict yourself to what you know Jerry, rather that attributing motives to people you don’t know ( in this case a nurse who you slurred by claiming she was asking too much money ) then we’ll get along just fine.

            Jerry: “I saw it all in the 1970s when the National Front used to say much the same – just saying…”

            You have shown your self to be a blind acolyte of the party. And your parting shot simply confirms your unwillingness to see the ‘big picture’, your desire to get the wrong conclusions because of your discomfort to discuss the underlying causes of our problems.

            Truth. If the government fixed the education system. Which largely means de-unionising it and deregulating it, then getting out of the education sector altogether. We would;

            1. Not need to import immigrants to fill jobs that could be performed by well educated and competent British educated candidates.

            2. Be selective about those immigrants we can import based on the quality of their education and the pedigree of the university they studied at. Not all university degrees are the same!

            Now as to your last slur, trying to imply that anyone who talks about immigration is a Racist.

            You do democracy a disservice by refusing to discuss immigration and provide succour to people in organisation like the BNP who wish to use race as their primary criteria.

            Immigration is discrete and separate to race, people like yourself who wish to conflate the two, well I don’t know what your motives are, but your behaviour is disreputable.

            One of my concerns about immigration is that we have not made provision in the infrastructure planning of thirty years ago for the sudden and explosive rise in the population.

            The politicians then use the threat of; water rationing, congestion on the roads, electricity brownouts – to their own advantage but never never address the root of the problems is that they – the Tory and Labour politicians who between them have governed this country since the second world war, have made a complete and utter dogs ear of the whole shooting match.

            You, and people like you, who then smear people like me with the label, racist and try to associate me with the National Front, people like you are just USEFUL IDIOTS to the political elite.

            Try thinking independently once or twice Jerry. Your beloved Tory party isn’t right all the time.

          • Kenneth R Moore
            Posted July 6, 2014 at 10:53 pm | Permalink

            To make comparisons with migration in the 70’s to the present day is farcical – just ask Sir Andrew Green at Migrationwatch. Migration today is on a massive and totally unprecedented scale.

            ‘I’m less than impressed by those who bleat about migration taking all the jobs’
            All the jobs..really ??
            Nobody is saying that – the old trick of misrepresenting a position in order to make it easier to attack.

          • Jerry
            Posted July 7, 2014 at 2:23 pm | Permalink

            Reply to both APL and Mr Moore.

            APL: <i."If you restrict yourself to what you know Jerry"

            Oh look, it’s dirty pots, pans and kettles time again…

            Kenneth R Moore: “To make comparisons with migration in the 70′s to the present day is farcical”

            Why, because it proves you wrong? Social and economic issues were much the same in the 1970s, certainly by the late 1970s, both jobs and housing featured high in both the Tory and Labour manifestos of 1979, Labour having this to say in their manifesto on immigration “Our whole immigration and citizenship law needs revision” whilst the Tories had a whole section in their manifesto devoted to what they intended to do if elected. Are you still going to claim that immigration wasn’t an issue in the 1970s?

            @Kenneth R Moore: ” just ask Sir Andrew Green at Migrationwatch. Migration today is on a massive and totally unprecedented scale”

            Trouble is, such people have been saying much the same since the 1950s, if not before. Also as Migration Watch has an agenda to push they are not an independant nor reliable source for a quote to prove or disprove any point – although it is very telling that you chose to use such a quote, in the same way as it is telling when a Renewables supporter tries to cite the pro AGW agenda rather than hard and fast facts.

            “All the jobs..really ??
            Nobody is saying that”

            Apart from the fact that I was being somewhat sarcastic, and I would have thought my tone of words used would have told you that, but anyway if there are plenty of other jobs (and indeed housing) available then what’s the problem – other than perhaps the fear of ‘jolly foreigner’?…

          • Jerry
            Posted July 7, 2014 at 5:58 pm | Permalink

            @APL: “Try thinking independently once or twice Jerry. Your beloved Tory party isn’t right all the time.”

            Unlike you APL I hold no flame for any political party or ideology, from what I read of your comments I am far more of “independant” mind than you will ever likely be, get over it!

  24. Andyvan
    Posted July 4, 2014 at 5:51 am | Permalink

    Historically a normal rate of interest for the UK would be around 5%. That won’t happen because it would blow a gigantic hole in the governments budget. The amount we’d be paying for the huge debt we have would mean drastic cuts in public services. It would also end the property bubble that is entirely sustained by very cheap credit. It would expose this funny money recovery for what it really is, a sham.

    • Lifelogic
      Posted July 4, 2014 at 4:47 pm | Permalink

      Drastic cuts in public services is exactly what is needed. So few of them are worth having anyway.

    • alan jutson,
      Posted July 5, 2014 at 9:15 am | Permalink

      Andyvan

      Cannot help but agree with your thoughts.

      Far too much borrowing by far too many people, and far too many governments, not just in the UK.

  • About John Redwood

    John Redwood has been the Member of Parliament for Wokingham since 1987. First attending Kent College, Canterbury, he graduated from Magdalen College, and has a DPhil from All Souls, Oxford. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.
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