The cost of homes

It is not surprising the cost of homes is so high, given the large increases in demand from new household formation, and the attempts to ration or limit supply by the planning system and the actions of the main housebuilders. It is also the case that pumping money into the system at low interest rates makes higher mortgages affordable for more people, so home prices like  bonds and shares have risen thanks to QE and low official interest rates.

To contain prices we need to cut demand and raise supply to better balance. Markets would do this for us but we have instead migration policies, housebuilding standards and planning policies that give government crucial roles.  The government via Councils and Housing Associations is also a major developer itself.All the time interest rates remain low we should expect mortgages at higher multiples of earnings to  be affordable.

In a managed system the government could reduce migration numbers as it has promised to do. It can continue with efforts to increase the number of homes built. It can also ask whether its standards and specifications are the right ones to encourage more building. A combination of UK government standards and wish to produce traditional looking buildings by the industry means a lot of work takes place on site. The UK has not taken up factory made sections and components on the same scale as in some other countries. It means the task of building is prone to delays for  bad weather. It requires a lot of on site supervision  to ensure decent quality, matters which would be partly taken care of by precision machinery in a factory prefabricating more of the home. The structure of the house building industry with its heavy regulation and high financing demands mean that most of the housing is supplied by a few large companies. They say they are constrained by a lack of skilled people and the need to maintain and supervise high standards from building more homes more quickly against all the planning permissions already granted.

Tomorrow I will look at the latest proposed government intervention into this government steered sector with their plan to use planning gains to offer discounts to some people on buying a new first home.

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65 Comments

  1. Mark B
    Posted February 14, 2020 at 5:47 am | Permalink

    Good morning

    Tomorrow I will look at the latest proposed government intervention . . .

    God God man, have people not done enough damage already ?

    Just stop foreigners buying houses. Most of the apartments begin built in London are well out of the price range of most people.

    As for the so called skill shortage, well you need to ask why ? There isn’t one Sir John ! Most of the apartments are prefabed in Poland and shipped in. They just want endless cheap labour so as to maintain their profits.

    Leave the market alone. Leave interest rates alone. Cut the number of people coming in. All doable. The one Thing we do not want is more government. It just makes things worse !

    • James1
      Posted February 14, 2020 at 7:57 am | Permalink

      The best thing the government could do to “help” would be to get out of the way. Stop “tinkering”. Just get out of the way.

      • Hope
        Posted February 14, 2020 at 9:59 am | Permalink

        Last year of the 212,000 immigrants, 150,000 came from outside the EU 50,000 inside the EU. If the Tory govt wanted it could have complied with its own policy. It chose not to! Despite having it as a policy to get elected three times. 72% of the population still concerned about the Tory Govt mass immigration policy. It is completely dishonest and is effecting all public services, our culture and way of life.

        Suggest JR and his govt reads Sir Roger Scruton book: How to be a Conservative. I am currently reading it and he puts it far more eloquently.

        There is not any conservatism in the Tory party or govt. It would be better named Lib Dumbs.

    • jerry
      Posted February 14, 2020 at 8:21 am | Permalink

      @Mark B; What a load of hard right wing nonsense…

      The skill shortage has been cause by the idiotic idea that 1/. the UK would no longer be an low skills nation, 2/. that over 50% young students should be attending Uni and obtaining a degree, any degree and at any cost (to the quality of higher education). Perhaps if our secondary schools went back to basics and once again taught such skills as basic brickwork or plumbing many less inimically gifted children would consider them as career paths.

      You complain that govt intervention does the damage but the UK’s best post WW2 period was between the late 1940s and mid to late 1970s, a period of high govt intervention! Our problems from the late 1960s being caused by international events, not so much domestic, for example the collapse of the original Bretton Woods system, from 1968 and the oil shock that followed in 1974.

      • jerry
        Posted February 14, 2020 at 8:57 am | Permalink

        @jerry; Oh for the want of an edit button… Academically gifted children, not inimically…!

        • Fred H
          Posted February 14, 2020 at 10:12 am | Permalink

          write, check, copy-paste from another product!

      • miami.mode
        Posted February 14, 2020 at 2:31 pm | Permalink

        …but, jerry how many kids do you know today who want to become bricklayers, roofers, etc and then have to work outside in all sorts of weather and then suffer the resultant pain of ill health brought on by such work and then having to work until, perhaps, 70 before getting a pension?

        Reports indicate that a huge amount of this work these days is performed by EU citizens from the eastern states who do not have the benefit of higher education.

        As our host says, we should perhaps look to some form of prefabrication to overcome such skill shortages.

        • jerry
          Posted February 15, 2020 at 8:14 am | Permalink

          @miami.mode; I think you make my point for me!

          What a depressing scene you paint of the average British youth, to weak to work outside in the weather etc! Why is it the youth in those eastern European countries can do such things but British youth can’t, do they have different blood in their veins or perhaps the difference is simply that British school age children have their heads filled to much nonsense these days?…

          When school age children were given proper Further Education or employment advice, when children sampled various skills as a subjects, they often found a liking for it, perhaps even taking it to exam level, because they were at least consider making a career out of it. But of course that was before all the politically correct humbug started, before Further Education became a business and thus FE Colleges became Universities.

          • miami.mode
            Posted February 15, 2020 at 11:02 am | Permalink

            jerry, in the US years ago when they dominated the boxing world they used to talk about hungry fighters. This has now transferred to the wider world as many such Americans found they could make enough money in American football and run less risk of personal injury. Ken Norton was a boxer, his son a footballer.

            In the EU the east Europeans are the hungry fighters and many of our younger people are prepared to settle for the welfare state.

          • jerry
            Posted February 15, 2020 at 9:04 pm | Permalink

            @miami.mode; As I said, what a dire (and ignorant) picture you paint of British youth, but I guess it is easier to blame the young rather than what was voted for at the ballot box…

            Children do not form their attitudes in a vacuum, they gain them from what they are taught, from family but more importantly schools, if you keep telling children that they will have high paid white collar empowerment is it any wonder if they choose to sit around waiting for that non existent job.

            In the past, over a prolonged period, I have been involved in both school work-experience placements and post 16 training, I have seen the problems schools, the national curriculum (and over zealous H&S regs post KS2) cause.

    • Dave Andrews
      Posted February 14, 2020 at 8:42 am | Permalink

      Foreigners buying UK property at astronomical prices means bumper revenue for the Treasury in stamp duty. To them, it’s a welcome contribution to foreign investment.
      I can think of no better reason why successive governments don’t restrict it. Rather, they want more of it.

      • Martin in Cardiff
        Posted February 14, 2020 at 10:15 am | Permalink

        Many governments do, e.g. in Denmark.

        You get for what you vote.

        • Narrow Shoulders
          Posted February 14, 2020 at 1:04 pm | Permalink

          I did not see a party proposing to make foreigners pay more for housing on the ballot paper Martin.

          Do correct me if I am wrong but I can’t see Labour or Lib Dems offering such an unwelcoming policy.

  2. Ian@Barkham
    Posted February 14, 2020 at 5:57 am | Permalink

    Good morning Sir John

    Yesterday some touched on the subject of ‘land banks’. It has been known for sometime now that most developers have enough land under their control to fulfill the UK’S needs for the next 10 years.

    This land is not built on unless the developer is assured a profit. Not unreasonable, but what is missed is this lands value comes from the taxes paid into the infrastructure by the taxpayer. Yet the developers pay no tax on it, logic therefore they are spongeing off the goodwill of others and profiting by the hard work of others. All housing is therefore subsidised by the taxpayer.

    It is taxpayers subsidies that ultimately destort markets, leading to further subsidies to iron out the distortions. Then more subsidies and so on. There is no free lunch

    It is government intervention with taxpayer money that is causing the problems we have to endure. That is why tax is so high, unequal and ultimately paid by so few – we are not all in it together. Achievement is punished, so why bother.

  3. William Pentelow
    Posted February 14, 2020 at 6:11 am | Permalink

    Are you insane?
    We do not need more houses, we need less people.
    When all the farmland is gone, what will we eat?

    • Shirley
      Posted February 14, 2020 at 7:31 am | Permalink

      +1

    • Andy
      Posted February 14, 2020 at 8:38 am | Permalink

      Which people do we need ‘less’ of? I assume you don’t consider yourself part of the problem. So who is?

      • Dave Andrews
        Posted February 14, 2020 at 1:27 pm | Permalink

        We could do without the criminals for a start.

    • Fedupsoutherner
      Posted February 14, 2020 at 8:58 am | Permalink

      Exactly. Too many illegal men coming in too.

    • glen cullen
      Posted February 14, 2020 at 9:38 am | Permalink

      Estate agency still have lots of property for sale – so houses are available
      Councils have lots of entry properties – but unable to fund repairs etc
      Most people sleep under a roof…..just saying there is a housing supply problem doesn’t answer the question of cost and why in its so high in certain areas…increasing the supply in those areas will not decrease the costs.

    • Charles
      Posted February 14, 2020 at 9:53 am | Permalink

      You may be right that we need less people, but we have a long way to go before all the farmland is gone. 56.7% of UK land is farmland, 34.9%natural, 5.9% is built on. It may feel like a very densely populated urban nation, but the reality is that the vast majority of the land area of the UK is not built on. Given that 83 per cent of the population of the UK lives in urban areas it is not surprising that some people hold the opposite to be true. However, from a land cover point of view, the United Kingdom is in fact dominated by pasture and arable land.

      You can look at your area, and the national picture here https://www.bbc.com/news/uk-41901294

      • Fred H
        Posted February 14, 2020 at 10:16 am | Permalink

        it is all very well stating how much land could be built on, but where will the jobs be, who will enable roads, transport, schools, health facilities, shops? The builders? Oh, so now the house price goes up astronomically and becomes unaffordable.

      • Narrow Shoulders
        Posted February 14, 2020 at 1:07 pm | Permalink

        There is plenty of space but how does one get to work or the shops.

        Builders will not build where there isn’t a profit and prices are low if home owners can’t get to work or to the shops.

  4. Ian Wragg
    Posted February 14, 2020 at 6:19 am | Permalink

    The government has no intention of reducing immigration

    You have been in power 10 years and we still have record numbers arriving.
    No effort is being made to stop them crossing the channel.
    We have no idea who they are.
    Disgraceful.

    • Shirley
      Posted February 14, 2020 at 7:29 am | Permalink

      +1

    • glen cullen
      Posted February 14, 2020 at 9:26 am | Permalink

      and thats the crux of the problem…..an issue the government will not fix (not cant but wont fix)

    • Mitchel
      Posted February 14, 2020 at 10:50 am | Permalink

      I read this week that President Erdogan has offered his jihadi-mercenaries trapped in Syria-and those he has transported to Libya-Turkish passports.What immigration arrangements do we/the EU have in place vis-à-vis future travellers from Turkey?

  5. DOMINIC
    Posted February 14, 2020 at 6:49 am | Permalink

    Housing? This isn’t about housing. The real issue is about Immigration. Deliberate and politically inspired immigration. Oh and how Labour have enjoyed stellar electoral success since 1997 thanks in no small part to their tweaking of the chain migration rules. Labour benefit electorally and to hell with the negative (social, financial and cultural) consequences for everyone else

    Politicians refuse to address this most pressing of issues. Why is this I wonder? Is it because Labour and the British Left use the issue for both political and electoral profit and therefore the Tories remain silent for fear of being taunted as racists and xenophobes?

    It’s quite simple. The more immigration we have, the more likely we will have a future Marxist Labour government. Labour’s creation of a free lunch-welfare culture attracts people from abroad like bees to a honey pot. Labour know this. They nobble the system and then silence debate when we try to expose their nobbling of the system.

    Johnson’s ‘people before passports’ speech to African leaders some weeks ago was completely irresponsible. This international level of virtue signalling defies belief.

    What is it with Tories at present? They seem almost desperate to advertise their woke credentials. It’s a MASSIVE turnoff for normal people who live in the real world outside the gilded chambers of politics. Give it a rest, it’s nauseating

    We need fewer people coming to the UK, not more.

    • Christine
      Posted February 14, 2020 at 7:36 am | Permalink

      Wait for his next announcement giving amnesty to all the illegal immigrants then the arrival of their families under the right to a family life. Even more houses will be needed and more welfare money. Meanwhile our kids get pushed further to the back of the queue. Has Boris lost the plot importing more labour voters?

      • Fred H
        Posted February 14, 2020 at 10:18 am | Permalink

        he might be encouraging more Labour voters if this trend continues.

    • jerry
      Posted February 14, 2020 at 9:26 am | Permalink

      @Dominic; Of course the debate is about housing, ho many British born people are stuck in either over proved rented accommodation or still living with parents/in-laws, far more than even the most wild of estimates of legal and illegal immigration rates.

      The real problem, that some wish to divert from (or find simplistic solutions) by the use of scapegoats, is the utter failure of the UK housing policy in the last last 40 years – the “market” can not be the sole solution for housing, never was and never will be, simply because its drive towards greater profits relies on shortages to drive up prices, given the limited scope for low cost-high returns added extras, certainly at the lower end of the market were the shortages are most acute.

    • Cheshire Girl
      Posted February 14, 2020 at 10:40 am | Permalink

      Dominic:

      I would be interested to read Boris’s speech to the African Leaders, if anyone would be able to post a link.

      • hefner
        Posted February 14, 2020 at 3:13 pm | Permalink

        On http://www.gov.uk search for “PM Africa Investment Summit Speech: 20 January 2020”.

        • Cheshire Girl
          Posted February 14, 2020 at 10:39 pm | Permalink

          hefner:

          Thank you for your kindness. Much appreciated.

  6. turboterrier
    Posted February 14, 2020 at 7:12 am | Permalink

    Sir John

    If this country can build modular section warships with aĺ the intricate components there within it surely cannot be out with the realms of common sense and ability to build modular homes. To take into account the services required they could be fired onto elevated bases to ease the connection and maintenance of such services and provide a margin of protection against flooding ensuring the long term durability of the structure. As politicians tend to subsidise new thinking as wit EVs maybe they could apply the same principles to the changeover to a new system and slowly change the whole of the existing thought process applied to modern new build properties.. properties will become more affordable and thre modular approach will not inhibit the size of the property that the clients want..

    • agricola
      Posted February 14, 2020 at 7:24 am | Permalink

      The Swedes have been doing this for as long as I can remember.

    • SM
      Posted February 14, 2020 at 7:39 am | Permalink

      I understand that mortgages are unobtainable for prefab homes – perhaps someone knows more about this, is it just for the wooden ones?

    • Fedupsoutherner
      Posted February 14, 2020 at 8:56 am | Permalink

      Good post Turbo

    • IanT
      Posted February 14, 2020 at 9:53 am | Permalink

      I think our whole approach to housebuilding in the UK is long overdue change. At one time a local builder (with a reputation to uphold) would build well constructed homes that could be described as “built to last”. Now we have the likes of Persimmon throwing up little boxes that are made of “ticky-tacky” – as the song goes..

      Looking around a partly-built local home a year or so ago I was appalled at the complete lack of care. The stud walling had gaps between the timbers I could put my fingers into – just bridged just by the two 6″ nails holding them together. Underneath the staircase, the treads were supported by random scraps of timber offcuts with bent nails. Anyone looking at this house being built would simply not purchase it. Being curious, I went back when the house was finished and it looked immaculate but that was purely cosmetic. This is a property that sold for over £1M and one which I wouldn’t touch with a barge pole even assuming I could afford it..

      It really must be possible to much build good quality, affordable homes than this and the sooner we start to do so, the better. These over-priced homes are a disaster waiting to happen – they won’t last.

  7. agricola
    Posted February 14, 2020 at 7:21 am | Permalink

    Congratulations on acknowledging that the building industry is outdated in construction methods, of dubious quality, and suffers antiquated regulation. Combine this with demand exceeding supply and a lack of imagination in the financial sector, not to mention uncontrolled population expansion and you have the situation we have today, fewer people being able to afford to buy their own homes. Fewer home owners means fewer people with a stake in the country which results in a more fluid political situation. Margaret Thatcher realised the importance of home ownership in shaping political thinking, why has her lesson been forgotten. I think that many politicians fear the sense of independent thought that comes with home ownership, and opt for the more controllable society they think it leads to. Yet another reason for the conservative party to revert to more Conservative thinking in it’s formulation of policy.

    In a philosophical sense home owners are only short term custodians of the property they are in. Changes in financial situation, size of family, and job location often mean that the custodianship only lasts about eight years. You then upgrade or downgrade. Lets consider a new form of mortgage/government loan that allows larger capital sums over much extended time periods at rates that reflect what government pays for money, so enabling more people to afford home ownership. On all inputs it will be a long time before supply exceeds demand so it will continue as a longterm means of increasing personal capital, providing of course that government removes it’s sticky hands from the process of home ownership after initially providing the capital. You have many financial ideas, give it some thought.

    • jerry
      Posted February 14, 2020 at 9:45 am | Permalink

      @agricola; “I think that many politicians fear the sense of independent thought that comes with home ownership”

      Thanks for the laugh, so being in hocks for tens of thousands of pounds to a mortgage provider gives a sense of freedom?!

      There was far more freedom back in the 1970s, many people went though life without even a Post Office saving (never mind bank) account, those in rented accommodation could move freely, even from one end of the country to the other if needs-be, perhaps to follow the work. Not forgetting that some only in hocks to the LA for next weeks or months rent was far more likely to partake in trade union activity…

      …Debt tends to focus the mind, and debt is exactly what a mortgage is and, unless it is very substantial, you are the person who has the problems not the banks or building society should you fall behind with the repayments, or the value goes negative.

      • agricola
        Posted February 14, 2020 at 11:16 am | Permalink

        A mortgage is an investment. You seem to glory in the world of serfdom. I hope those you beget like it too. There is a life beyond your losers charter and that is what I believe Boris wishes to rekindle.

        • jerry
          Posted February 14, 2020 at 4:27 pm | Permalink

          @agricola; No, a mortgage is pure debt, until it has been fully paid off, it might then becomes an “investment”, but if the property value has fallen -for what ever reason- since taking out the mortgage it hasn’t become an investment but a loss, and might even have become a millstone if the owner wishes to sell but can not afford to take the loss.

          Oh and I’m not in the world of serfdom, I’m in the world of reality, unlike those -like you- who seem to inhabit a 1980s utopia that never suffered the early 1990s negative equity trap – fortunately I wasn’t affected but I did know some who were affected, one very badly.

  8. ian terry
    Posted February 14, 2020 at 7:25 am | Permalink

    It is the old old story problem or solution.

    The real problem is too many people being allowed in for whatever reason.

    Encouragement to reduce family sizes by paying less child benefits.

    If and when politicians grasp this nettle and actually stop the talk and act to address the population growth , this will remain what it always has been an ever growing problem..

    • Dave Andrews
      Posted February 14, 2020 at 11:55 am | Permalink

      Women with career options other than housewife (a perfectly respectable profession in itself) may well decide to have smaller families, or even none at all.
      We should not accept immigrants with a mentality that treats women as second-class citizens, where becoming a wife, having children and keeping home is their only option.
      I don’t mind contributing to children’s upbringing by way of education for example, passing on a benefit that was given to me.

  9. Iain Gill
    Posted February 14, 2020 at 7:25 am | Permalink

    This just looks like more bias and sometimes downright corruption in the system in favour of new house builders.
    Build a house with serious problems in this country and you will almost certainly “get away with it” and be allowed to do more of the same.
    Building inspectors supposedly enforcing building regulations sign off houses on a large scale which can easily be shown to be in serious breech of the regulations, and there is absolutely no way an individual citizen can complain or stop such poor service. Those same building inspectors are often eating in the same places, drinking in the same places, having their food and drink paid for, as the builders they are supposedly policing. Its almost impossible to find out which building inspector signed off a property, and even if you can prove serious obvious faults missed there is no way to stop that building inspector doing the same again.
    “New build guarantees” which are insurance policies supposedly there to help the home owners get any serious faults fixed are definitely subject to massive widespread fraud and abuse. The insurance companies put big obstacles in the way of anyone trying to claim. It is a national scandal. I could write a long essay about the many ways they are doing this. Then when the policyholder complains to the Financial Ombudsman Service and FCA guess what the Financial Ombudsman service is completely and utterly incompetent and corrupt too, with staff fighting to move into their next job in the insurance companies not prepared to find against insurance companies. The scale of this reported, for instance, on reviews of them on Trustpilot are amazing. Then for the small number of cases where insurance companies are forced to pay out the insurance companies extort signatures before payment where the policyholder signs away rights to claim for further problems.
    We need dynamics in the system to force up the quality of new build houses, not down.
    And how do you think someone who bought their first house just before stamp duty was removed in the last government feels? Currently sitting on a house with serious faults unable to get the new build insurance to fix it? Watching to see people buying just a short while later not just getting no stamp duty but also a straightforward 25 % subsidy? It’s ridiculous.
    Like other attempts at manipulating the market for new builds by the government it will not reduce read prices to consumers, it will just go in the pockets of the new house builders.
    Prices are where they are because of countless government manipulations, mostly as you say planning, but also high levels of immigration allowed by the politicians and the way school catchment areas work. The idea that more government manipulation is going to fix it is laughable. The best thing the government can do is stop manipulating and fix the parts of the state supposedly to keep the standard of new builds high, the building inspectors need proper impartiality rules and complaints process, the way the financial ombudsman service is operating needs a real root and branch reform with properly independent complaints process and random cases audited by judges to see how far off they are from decency, house builders and insurers should be obliged to tell home owners of any faults they know about which the home owner is not aware of ON THREAT OF CRIMINAL PENALTY IF NOT and so should the building inspectors, financial ombudsman and FCA.
    There should be a set of nationally agreed house plans which are already planning approved, to stop endless waste repeatedly reviewing the same things at local level. Local planning should focus on where those designs are allowed to be built and when. Local planning should not be able to mandate changes to those designs. New house builds should get breeze block walls internally and not just the thinnest cheapest plasterboard available.
    All of this is stating the obvious, why oh why don’t the political class “get it” oh yes because of all the lobbying from the new build lobby they allow.

  10. The Prangwizard
    Posted February 14, 2020 at 7:34 am | Permalink

    We need much more investment into off-site prefabrication. That will no doubt require a change of materials. More timber and composites. I’ve mentioned many time it’s a foolish short-term solution for the country to increase supply of widgets by bringing in extra labour and putting it to work doing the same old things in the same old way. And guess what we’ve had to import labour to do it. Clearly the leaders of our building firms are not up to the job. We need change.

    The only new idea I’ve seen around here is fake chimney stacks being trucked onto site.

    • The Prangwizard
      Posted February 14, 2020 at 9:55 am | Permalink

      Just would add that we think nothing of accepting that garden sheds and summer houses are prefabricated and at another level ‘park’ homes are fully prefabricated off site. It’s fairly common to see the two halves on the back of lorries.

      I wonder if we don’t see this in the homes we are talking about because the big house builders actively prevent it.

  11. jerry
    Posted February 14, 2020 at 7:55 am | Permalink

    Far to many still seem to believe that the ‘market’ can sort out all the problems, even those that the market its self creates…

    Many of the problems cited have been around for decades, certainly long before EU freedom of moment and the current fade by some to blame the migrant. As I pointed out yesterday we had migration in the 1950s and ’60s, at a relatively higher level [1], and in the 1970s we had sudden influxes of high number of refugees such as c.30,000 Ugandan Asians (all within a 90 day period), but because govt took a lead and instigated LA house building programmes back then there was far less people who could not find a place to call home. We also had economic polices that encouraged all areas of the manufacturing chain, little was off-shored, apart from importing raw materials. In the 1950s we were extolled to “Export or Die”, in the 1960s we were extolled to “Buy British”.

    How should we advance, back to the future perhaps?! It did not stop people buying their own homes, in fact it made it easier, at the moment the only people who benefit from a lack of cheap affordable LA housing are the private landlords, often leaving people stuck in private rented accommodation because they have little extra money left to save for a deposit. Many a construction company made their fortunes building LA housing or other Govt projects.

    [1] relatively higher because our infrastructure was less developed, back then still had a very large housing deficit due to war damage and slum status/clearances

    Reply I remember under the Thatcher/Major governments we had around 50,000 new migrants a year, which then went up
    fivefold to 250,000 under L:abour and stayed there. (rough figures from memory)

  12. Narrow Shoulders
    Posted February 14, 2020 at 8:03 am | Permalink

     It is also the case that pumping money into the system at low interest rates makes higher mortgages affordable for more people, so home prices like  bonds and shares have risen thanks to QE and low official interest rates.

    Low interest rates leading to higher mortgages must also heap pressure to defer any rate rise decision going forward.

    If mortgages are only affordable at low interest rates then raising those rates to a more historic level will lead to mass default. It is a feedback loop.

    For the same reason government and the market can’t drive prices down like technology, there is too much investment tied up in high prices.

    • Mark B
      Posted February 15, 2020 at 10:27 am | Permalink

      . . . there is too much investment tied up in high prices.

      And that is the nub of it ! They have created a whole bunch of Ponzi Schemes they cannot get out of. Housing, MASS IMMIGRATION, minimum wage, etc. They cannot go back, only forward and this ratcheting effect will lead to Socialism, where the State has to enter more and more to control the mess it has just created. The politician, even Sir John, cannot see the legacy that New Labour has created. That is why we are still getting their policies.

  13. Dave
    Posted February 14, 2020 at 8:03 am | Permalink

    What we need is large scale repatriation of fake asylum seekers and anyone else that has no right to be here and provides no value at all to the country. Also any foreign national convicted of any crime whatsoever should be deported. We need interest rates at reasonable levels of 5 – 10%. We need an end to the funny money system of fractional reserve banking and central bank bail outs. We need fraud and criminality punished in the manner that a non pc social media post is now. In short we need to apply the rule of law equally instead of just to easy targets. Will it happen? Of course not. Too many of the powerful would suffer justice.

  14. Alan Jutson
    Posted February 14, 2020 at 9:03 am | Permalink

    Yes production line off site type housing can be done, remember the old post war prefabs.

    The problem is getting a planned and constant demand, so that the production line works efficiently and labour can be employed full time.

    Volume of the same or similar models with options are also required to keep costs within control.

    The big problem is the cost of land and the approval of planning.

    I designed and built my own house 40 years ago, also know about mass production as worked in R&D within the motor industry at the time.

    The greatest need on any site is competent supervision of all trades, especially in this day and age when lightweight materials are being used which are not always suitable for our climate, prefabricated or not..

  15. Andy
    Posted February 14, 2020 at 9:05 am | Permalink

    Politically it is easy to blame immigration for our housing problems. But (migrants ed) living 8 to a house are not your primary issue. And if you want to fix the problem you have to identify the main cause: demographics.

    We are living longer – and living differently – to the way we used to. But we are still building the types of homes we always have. And as well as building the wrong types of homes we are building them in the wrong places.

    Firstly, the young. Young people now tend to stay single for longer. Consequently we need to build lots of stater flats for those leaving the nest. Not all the luxury apartments that are springing up everywhere. Decent but modest first homes. Ideally in places which are good for public transport and jobs.

    Secondly, the old. We have to build proper, decent retirement accommodation for the elderly. Things with suitable care facilities either on site or nearby but also with easy access to transport, supermarkets and leisure activities like cinemas, parks and gardens and so on.

    Thirdly, families. We need to make sure there are enough decent family homes. Too often existing family homes are owned by elderly people who would be better off in smaller accommodation. These homes are best off outside of city centres – they need gardens, parks nearby, quiet roads, cycle paths, libraries and good schools.

    It is fiction to suggest we need to concrete over the entire country to achieve decent and affordable accommodation for all. We just need to make the best use of what we have. Blaming immigrants will not solve the housing problem – because it is not the primary cause of the housing problem.

    Reply The numbers show the main reason we need more homes is the strength of net migration.

    • Edward2
      Posted February 14, 2020 at 6:19 pm | Permalink

      You wrote a similar post to this nonsense yesterday Andy.
      You try hard to blame older people for everything but the facts and figures do not agree.
      As I said yesterday, births and deaths are registered and considered by the Government and Councils who also relate these figures to the last Census.
      It is predictable and infrastructure can be planned.

      However the record levels of immigration since 1997 is unprecedented in our history.
      Some 7 million extra people it is estimated.
      A new city the size of Southampton is needed to be built every year.
      An impossible task for any government to keep up with.

    • agricola
      Posted February 14, 2020 at 7:36 pm | Permalink

      Reply to Reply
      Too true. When you have been importing a migrant population the size of Nottingham every year you have a housing problem.

  16. Stred
    Posted February 14, 2020 at 9:14 am | Permalink

    Prefabricated construction is used in the form of timber frame inner walls with dry lining. Concrete section are used for high rise flats. Steel framing is erected quickly. Cladding systems are used.
    However, customers prefer traditional materials like brick and tile on the outside and these can be a small proportion of the whole process, which involves far more regulation than used to be the case, site preparation, services, roads, foundatios etc.

    There is also the question of flexibility of plan when using whole house factory made units. Most building sites are restricted and the architect has to adapt with some unusual planning in order to fit the development onto what is available. Besides how popular would estates be where every house was exactly the same. People who have pushed factory building in the past have ended up with disasters of social and constructional failure.

  17. alastair harris
    Posted February 14, 2020 at 9:37 am | Permalink

    If you want examples of how the planning system stifles supply then watch grand designs on all 4. Plenty of examples there of how long it takes, and the arbitrary decisions that get made.

  18. bigneil(newercomp)
    Posted February 14, 2020 at 10:24 am | Permalink

    House costs? What about all those whose housing – and everything else – the rest of us have to pay for?

  19. Jan Maciag
    Posted February 14, 2020 at 10:36 am | Permalink

    We have a housing supply system based on Soviet thinking and the prescription to reduce construction cost by a greater use of factory ‘off site’ production is yet another lurch into Soviet thinking to solve problems emanating from Soviet thinking.

    Did we not learn anything from previous attempts at pre-fabrication and cutting edge architecture such as the Southgate Estate in Runcorn? Look at the award winning 10 year old Eco-homes at Goodfellows Development in Bury St Edmunds!

    In reality we have two main housing problems. Our dependency on 19th and early 20th century stock means that much of it is reaching the end of a life cycle that has been impressively long. But old buildings, although often much loved, are protected by heritage legislation and expensive to repair. At the same time we have spent 70+ years building ‘modern’ industrial housing that is almost impossible to maintain, increasingly unattractive with age and difficult to alter and adapt to new needs.

    With the crackdown on CO2 emissions, these poorly built structures now have complex ventilation and heating systems that will shorten (like modern cars) their economic lives even more.

    The real crisis on our doorsteps will arrive when replacing the old pre-1939 stock concurrently meets the replacement of the post 1945 stock. As things stand we are not building our way out of a housing crisis but into a housing Armageddon in, roughly, 2050.

    The answer is counter intuitive – build better quality homes with much better longevity and adaptability. Use better materials and better traditional designs (that will ride changing fashions) and better urban settings.

    These are things that customers [the market] and neighbors want. It will be more expensive in the short run but can we afford to build more and more cheap rubbish for our children to replace.

  20. Iain Gill
    Posted February 14, 2020 at 2:54 pm | Permalink

    Lets have a public domain website listing per new build property which named building inspector signed it off as meeting building regs. Lets have some proper impartiality rules for building inspectors. Lets have a properly independent complaints process for the public to use if they find serious problems which building inspection has missed. Lets have building inspectors removed from the profession if they make serious mistakes.
    Lets have proper qualified engineers or architects deciding when new build warranty claims are valid, and not the incompetent financial ombudsman service. Lets force anyone in authority knowing about serious problems in any building construction legally obliged to tell the owner and occupiers.
    Lets stop planning arguing about building design by having pre approved building designs at national level, let local planning have a say in colour of tiles and bricks and no more. Cuts lots of cost out of the planning process which should be passed onto public.
    Lets get rid of catchment areas for both schools and GP’s, let the public take their business where they like.
    Lets stop manipulating the system in favour of one demographic over another.

  21. hefner
    Posted February 14, 2020 at 3:27 pm | Permalink

    Not on homes, but maybe interesting to some: on visualcapitalist.com 07/02/2020 “Ranked: The social mobility of 82 countries”.
    I will not comment as I do not want the “usuals” to misinterpret what I could be writing.

    • Edward2
      Posted February 14, 2020 at 10:10 pm | Permalink

      Oh go on hef.
      Don’t tease us all.
      Have the courage of your convictions.

    • dixie
      Posted February 16, 2020 at 7:41 am | Permalink

      The interesting element in that report for me is the inclusion of life-long learning because it facilitates a person taking responsibility for their own capabilities and raising themselves by their own effort. More importantly, it is a means to dealing with change and uncertainty and still put food on the table.

      This is enabled via the now many online learning sites and underlines the importance of an effective and accessible broadband infrastructure beyond the usual bread and circuses.

      What is still missing though is respect for learning, achievement and STEM, the motivation to spend the extra effort at the end of a long day when we are barraged by a media more interested in the latest artiste’s transgressions and elevating opinion over fact.

  22. Frank Wilson
    Posted February 14, 2020 at 5:10 pm | Permalink

    Spot on.
    Personally, I’d like to see the Government instigate a scheme to provide ‘serviced’ plots of land to ‘self build’ homes.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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