There is growing agreement amongst politicians and their advisers that housing is a central part of the new political battleground. Years of inviting in large numbers of people to live and work in our country against a background of building too few new homes for them and for the natural growth of the settled population has left us short of decent homes at affordable rents or prices.
Some years ago there was a strong establishment view that the UK needed to be more like the rest of the EU with a larger private rented sector. This duly came about as a new generation of private landlords rushed to purchase Buy to Let properties. Frustrated by taxation of other savings and the restless changes made to the taxation of pension plans, many thought owning a Buy to let or two would make provision for their retirement years and represent a good store of value. The establishment Ā visionaries seemed to think younger people would benefit from renting rather than buying, though most of them making this recommendation were safely housed in a property they had bought atĀ much lower prices when they were young. They argued that renting was more flexible, and kept the young person free of mortgage debt.
I disagreed at the time with the view that renting was superior to buying. I pointed out renting is bound to be dearer over a lifetime than buying and owning. The longer you delay buying a property, the more rent you pay. You usually end up having to pay much more for the home you do eventually purchase. Rental agreements are not that much more flexible than buying if you sign a commitment to a longish fixed period of paying the rent. Finding a suitable rented property is not intrinsically easier than choosing a place to buy.
The Conservative party needs to commit itself anew to creating a new generation of home owners. Polling shows many people who rent would like to be able to buy their own home. The problem is they do not think they can afford to do so, owing to the high transaction costs, the need to find a large deposit, and the availability of mortgage credit.Ā In contrast there are fewĀ opeople who own who would rather rent, and of course there is nothing stopping someone who owns from switching to rent if they did wish to do so.
The government can and should do moreĀ to lower the transaction costs of buying and selling properties. Lifting more people out of Stamp Duty altogether, or cutting the lower rates would help. To make the market work better the government also needs to see how Stamp Duty and CGT are impeding sales of BTL homes and larger properties owned by people who might otherwise downsize. The older generation include people who have more property than they want, reluctant to sell owing to the tax costs in doing so and buying something smaller. The younger generation includes many people who would like to buy the family homesĀ but cannot afford to.
Getting house prices more in line with wagesĀ needs to occur at a sensible pace. Controlling the numbers of people coming to live here each year would help by cutting demand. Encouraging more building, as the government is doing, will assist by expanding supply. TheĀ Chancellor committed himself to helping get real wages up, which also will assist.Ā The Bank of England and the commercial banks can also help by recognising Ā that most young people will b e good risks to lend to to buy a home, just as their parents did before them.
I look forward to more positive announcements from the government on how it will transform more dreams of ownership into reality,
October 4, 2017
Renting is cheaper in the short term especially with such absurd rates of stamp duty thank of Osborne and Hammond. It can easily cost 20% in in dead and out costs when buying & selling a new house. This can be about 5 years rent. Yes buy but buying for less than about 5 years is probably a mistake. Buy only when you are likely to be there for a long time as renting is far more flexible if your job moves or you need a larger property.
IHT at absurd rates (plus all the gifts with reservation traps) means that owning a large house late in life is also usually a mistake tax wise.
We need both rented and owner occupied housing. After all if you do not have the cash you either rent the house or you rent (borrow) the money. Rents also included maintenance and insurance which people often forget when comparing a mortgage with rents.
Cut stamp duty, relax planning, cut the green crap building regulations, cut OTT utility connection charges, cut building control fees, get more competition in banking and get building and extending.
October 4, 2017
I would rather rent and move regularly with work, but in the British system the only way to get decent schools for the kids is to buy near a half decent school, and keep the kids there while the breadwinner moves around. Trying to move with the kids immediately hits the nonsense school allocation system which penalises anyone moving for work into the area recently.
School/NHS catchment areas are a large part of the problem.
I regard a large proportion of my housing cost as a hidden tax on entrance to a decent school.
But the political class dont get this or the way to fix it.
We hear more nonsense from Ms May every day.
I despair at the quality of thought processes from our political class.
October 4, 2017
It’s not just the taxes, but the moving costs as well. Add in surveyors fees, removals costs, legal costs and of course the Bank charges for letting you have a loan.
On the other hand, not moving often means missing the boat with house price inflation which never seems to end and of course the rent. Then regular movers, although incurring all these costs usually trade up and end with a much higher value property which will be useful in retirement for trading down again or getting equity release. All in all, I think you are better to buy than not – I can’t see the point of buying a landlord a house for him when you can get your own. If you can’t buy then that’s another story. Once paying rent you will almost certainly never be able to buy. Mortgages need to be brought up to date. If someone can pay a landlord say Ā£1000 per month, then they should be allowed a mortgage equivalent without the great big deposit.
October 5, 2017
I agree with your Graham
October 4, 2017
Treeza Halifax May gave a shameful speech how her grandmother had four grandchildren- three professors and a PM. So why would she not allow us or our children the same education opportunities such as her Grammar school education or Oxbridge university education at the same cost to her parents?
Grammar school climb down. She is happy to provide EU students free university so they are able to compete better than our citizens in our own country for jobs without debt. Shame on her. Shame on your party. If she thinks her proposals are a vote winner think again.
October 4, 2017
Good morning.
What a wonderful, honest and frank article laying bare many mistakes government has made and its effects. Unfortunately our kind host thinks that ‘more government’ is the solution. It is not.
The government has allowed itself to be shackled into committing evermore money to the State. Whether it be through the NHS, Overseas Aid, Green Crap, pointless White Elephant projects and so on. In order for government to help it needs to do less, borrow less so it can then tax less (ie Stamp Duty). In short, the government before making all sorts of promises needs to get its accounts in balance first.
We do not need government help. What people need is for government to get out of the way. We need to reduce the size of the state and its scope.
Less (for government) is more (for the people).
October 4, 2017
You’re right too much government is the problem. Unfortunately the Conservative party is incapable of making a case for less government. It will not challenge the idea that the solution to any problem is government action.
October 4, 2017
Indeed planning restrictions and OTT green crap building controls and expensive energy are the main reasons for the lack of housing. Also misdirected bank lending regulations from government and absurd stamp duty levels, land registry free, utility connection fees …….
We can build plenty of housing for pigs and chickens with agricultural consents but not, it seems, homes for people.
October 4, 2017
The trouble with T May is that she prefaces her pronouncements with…. āThe govrnment should do/is doing/needs to do more to solve an issue. What I want to hear is that the government are enabling or ensuring conditions are simplified in order for business or innovation to grow. The government tends to solve little, cost a lot, and complicate unnecessarily.
But I am asking too much arenāt I…..
zorro
October 4, 2017
Here’s a policy idea -borrowed from the USA(not something I’m normally in favour of)-cash for clunkers.
Starting with a whipround for Mrs May.
Her speech?….well,really,it would take a heart of stone not to laugh.
October 4, 2017
If we build lots more homes and reduce immigration, house prices will fall, voters will feel poorer and the other lot will get in at the next election. And that, I assumed, is why governments neither build more houses nor cut immigration.
October 4, 2017
If there is not a radical change at the top of the Conservative party there will be a complete disaster for them at the next election. The DUP will not be able to save them.
October 4, 2017
As yet another example of the pointless huge costs and inefficiencies government inflict on others I have two properties that I am currently trying to obtain planning consent for.
One we were told could probably be converted from an agricultural barn to residential and the other industrial plot we would never get residential on so we looked to extend the industrial buildings and planned that way.
Now an absurd court of appeal ruling (relating to how much actual conversion work is needed) has ruled out the first. But what possible difference does the extend of the work make? Surely what matters is what is left after the build? Also a new planning law now means that the second can now probably go to to residential after all which is better financially. So I have wasted lots of money and time heading in the wrong directions on both plots. What a waste of time and money due to moronic court decisions and planning uncertainty and complexity. At least the costs are tax allowable!
October 4, 2017
If all the people who (largely parasitically) work as planning officers, planning consultants, planning lawyers, bat & newt report experts, greencrap building control experts and the likes were fired and told to get out of the way. Then re-trained as builders, plumbers, joiners, ground workers … how many more houses and work places might we have and how much more productive might the country we all be?
October 4, 2017
“I pointed out renting is bound to be dearer over a lifetime than buying and owning.”
In general yes but not if you have to move home a lot, nor if you live in an area where property prices are declining – perhaps due to depopulation or declining local jobs.
People move for jobs reasons, love reasons, divorce reasons, needing a larger home for children, school reasons, health reasons, tax reasons ……
My advice would be to buy only when fairly settled, buy something that is large enough for the future needs, in an area that is generally improving and that can be extended if needed. Or buy something with nice planning gain opportunities. Look at new transport links being planned or build for example.
October 4, 2017
yes only works like that if you have the kind of job where you can stay in one place for a long time.
for the mobile workforce the system does not work, and buying is often a bad idea.
October 4, 2017
Here we go again; reduce transaction costs, amend stamp duty, get real wages up, reduce demand, have a government plan. For God’s sake just do the one thing that will boost supply and lower prices: relax the planning regulations, and by relax I mean pretty much abolish it.
October 4, 2017
Importing millions of people (including many illiterates, low earners and dependents) and building over the countryside is unsustainable.
In many parts they are knocking down factories and building housing estates on them.
For the time being employment in the local construction of homes replaces the lost factory jobs – but for how long can this go on ?
Relaxation of planning laws is a failure to tackle the real issue and will see any local council or MP delivering it sacked.
October 4, 2017
Britain needs fewer people, not more houses.
There simply aren’t the wealth generating jobs to pay for new houses.
Those who say that the construction industry is part of the wealth generating sector is (like coffee chains) economic sleight of hand.
The factories came first, followed by the housing.
Mrs May has got this completely arse about face – yes, to woo the millennials, I see this. But the reason their wages are so low and their house costs so high is they are having to compete with a lot more people – yet they want the EU and the direct competition that makes their lives hard.
It has become taboo to tell them it straight. They are lost to the Tories who were only safe until the millennials learned how to vote at the last general election.
Hit landlording if you want to make a more immediate impact – reward pension savings too, stop old people becoming reluctant landlords.
October 4, 2017
Cutting stamp duty would simply put up prices by an equivalent amount. On average sellers maximise the price they ask based on what buyers can afford, if buyers have lower transaction costs then they can afford to pay more. By making things easier for buyers you are increasing demand which is the exact opposite of what you want.
There are only two solutions: increase supply (more houses) or decrease demand (lower net immigration or penal taxes on overseas investment buyers of UK residential properties). There are blocks of flats near me which are 50% owned by offshore investors in Hong Kong etc., in fact they were directly marketed there, that has fuelled massive price inflation.
October 4, 2017
Not quite true as cutting stamp duty would mean people could move more freely to down size perhaps and also it makes more developments worth doing and so increases the supply of properties.
October 4, 2017
Roy Granger ,
Your first paragraph has it right .
Any measures to expand credit (like “help to buy”) or reducing transaction costs will just find their way into higher prices . Same with rents , in areas where there is a shortage they will expand to consume everything a renter can pay – Ricardo’s Law of Rents .
A house is worth whatever a bank will (or can) lend to buy it . Up until the mid 1970’s strict rules on borrowing limited this to 3X the mans salary , then it became 3X the couples combined salary , now it is is 4.5-6X the combined salary .
The situation is actually much worse . The 1970’s wage was net of a substantial employers contribution to a DB pension plan . In 2017 most employers contribute nothing of consequence to employees pensions .
The more prices go up , the more a bank can lend the next time – as a mortgage is a loan secured against the value of a house . This just creates a positive feedback loop driving prices higher .
It’s no just overseas speculators . I favour reducing transaction costs and replacing with an annual Location/Land Value Tax (LVT) along the lines of Adam Smith’s Annual Ground Rent (AGR) .
Basically slash treadmill taxes like income tax and move some of the burden of taxation on to residential land . This levels the playing field between UK owner occupiers and speculators .
October 4, 2017
I have absolutely no idea what the Tories now stand for. I recognise that Labour is now a party that is committed to a complete restructuring of the British economy along socialist lines. This will destroy the UK and transfer massive power over to the unions.
And here we have Mr Redwood talking about transaction costs on property. Utterly meaningless, almost detached from reality
Get real.
And no doubt we will have to listen to May boring all and sundry with talk about social injustice for so called minorities and all the other left wing tripe she’s suddenly developed an enthusiasm for. Who is advising this PM?
I saw Boris Johnson’s speech yesterday and for the first time a Tory MP made sense for once, and unlike many Tory MP’s who are so terrified of saying the wrong thing they end up talking nonsense, pandering to the fashionable topic of the day
Get back to first principles for god’s sake before it’s too late
October 4, 2017
Thank goodness for Boris – surely without him the delegates would all have been dropping dead of boredom or actively killing themselves from depression after listening to Rudd, Hammond, Hunt, Gauke, Davidson and the likes.
At last some uplifting we can do it vision from Boris and Mogg.
October 4, 2017
yes indeed.
again I offer the Conservatives to sketch out the bleeding obvious policies needed to steer a straight course and be able to win landslides in all sorts of demographics, stuff that is obvious to most of us. But no they would rather live in liberal elite fantasy land.
Ms May is useless.
October 4, 2017
“I have absolutely no idea what the Tories now stand for..” They stand for everything. whether free market and not free market. They stand for anything, that is they are tolerant of every thing no-one should be tolerant of. Over-population, irresponsible level of immigration, terrorists in out midst. Stand for multi-centres of authority when government should be the only authority. Arms-length government based if not in Brussels then in some fantasy land of diversity. Stalwart defenders of the curtailment of free-speech unless it is their own.
October 4, 2017
Just stand for staying in power, just another iteration of the same old blair/brown/cameron nonsense.
Not a decent bone in their bodies.
October 4, 2017
Lots of fine-sounding platitudes, pluckily delivered; but, I’m sad to say, without our ancient cultural bedrock, this p/c liberal edifice cannot stand.
October 4, 2017
Re today’s Conference speech,look at Mrs May’s wrist -she is wearing her heart on her sleeve-literally-it’s a bracelet featuring the self portrait of Frida Kahlo-the Mexican feminist,communist artist and sometime lover of Leon Trotsky!
October 5, 2017
I wonder if it was a gift off someone who knew precisely who it was?
October 4, 2017
There has been a red flashing warning light over this issue for several years now for the Conservatives. If Mrs May really does want to stick around, she needs to move this issue right up the agenda and make sure that there is tangible progress – measured by %age of home ownership – by the next election. Key moves should be to cut stamp duty and tear up planning laws or take powers to override councils unable to stand up to local nimbys. Another factor in this is EU agricultural subsidies which mean a lot of marginal and grotty land is being farmed which would be better used for housing. We need leadership and vision – and very rapid action.
October 4, 2017
Too many house empty . I don’t see the sense, except for boosting the economy temporarily and creating crowding long term.
October 4, 2017
In the balance of supply and demand, residential faces a supply ration – because we don’t want ever more beautiful meadow turned over to concrete and brick.
On the other side, there is no demand ration, hence prices go through the roof. You rightly identify reducing demand by controlling immigration, but we also need to ration demand by restricting who can own residential.
It’s time we banned the buying of residential for business speculation and only those with a legitimate reason to own can. That includes owner-occupier of course, local councils for affordable rents and housing associations with a view to releasing freehold. Allow buy to let within reason, say Ā£1m, for those seeking alternative retirement income. Anyone else, no, they must sell or an auction is forced on them.
Current prices for housing and rent is oppression of the poor and immoral.
October 4, 2017
“occur at a sensible pace” – ZIRP has bubbled assets including houses, a sensible pace would be a fast reduction in house prices. The bias towards ownership and debt has been directly caused by policy which the BoE and Govt refuse to correct. This policy has punished ‘decent’ workers who “get on their bikes” whilst rewarding those who over borrowed or own assets. The continuation of such a bias may promise an alternative bribe to Labour’s but at the same team will drive many others to the alternative. Significantly raise rates to burst the bubbles and redistribute the pain and gain, otherwise alternative redistributions will be sought and only make things worse.
October 4, 2017
In European countries like France where property prices are low , buying is not seen as an investment. As a result, young people do not buy, they rent, even though they pay out far more in rent than they would for a mortgage.
Renting via a six month assured shorthold tenancy in thr UK is much more flexible and that suits youngsters who move in and out of relationships and often want to move for job or other reasons.
With tbe sheer impossibility of the average person being able to build up enough pension funding, we need to preserve the investment element so that in retirement people can release cash to live on via trading down or through equity release.
If the housing supply is expanded very quickly causing a large dip in housing prices immense damage will be done to economic confidence as tbe feel good factor of owning equity will be lost.
We need a revolution in the way property transactions are conducted. It should be no more difficult to buy a house with a mortgage than to buy a car on finance. That will encourage more youngsters to buy but they will only do so if they can still see that buying a house is a sound investment that they can sell easily and cheaply.
October 6, 2017
Monza
Home ownership in France is HIGHER than the UK
October 4, 2017
Housing is so fundamental to life, and it does need thinking through.
Looking at the many sink council estates across Britain, one can only assume that something horrible happened – it did – the notion that the State is responsible for everything, and individuals can live off it.
I’m all for making council housing affordable, but there should be a stricter contract such that those housed actually maintain the properties – I see so many council houses with big flashy cars parked outside, and wonder why such people are allowed to live in houses for such a low rent … lets’ stop puting the burden for housing on the taxpayer!
When people buy council houses, they profit at taxpayers expense – they should give some of the profit they make back.
October 4, 2017
Boris is a social liberal, he is cut from the same cloth as Cameron and Osborn. The only difference between him and those two is that he did not change his accent. With him as PM it would be a continuation of our seven year journey to nowhere. The economic orthodoxy would be remain and he would implement his own great ideas such as amnesties for illegal immigrants. Ms Davidson is no saviour either.
October 4, 2017
One of the major problems we have in this country is down to disunited families – We really could learn a lot from India on this matter – they know how to keep the generations together, and care for their elderly in their own home.
This needs to be a consideration when new homes are planned – but most rooms in new British homes are so pokey, there is no room in the house for extra people – Surely, it wouldn’t cost that much more to nuild decent sized room, and add a Granny annex?
To improve socially, we have to be more cohesive, and that means family.
More thought also needs to go into providing houses at the place of work, so that people do not have to move away from family or commute for hours.
October 4, 2017
The Tory Party’s continued obsession. Electorally attractive promises of home ownership. Where’s the money coming from?
It is a sure-fire political and economic scam on the electorate. They actually believe you are doing them a favour. It is the only way a con trick works.
October 4, 2017
Prigger. Current UK 30 year Gilt rate is around 2%. At Ā£250,000 per dwelling with an annual rent of Ā£8,000 rising each year, notwithstanding repairs, it should clear the debt within that time scale
October 5, 2017
miami.mode Please don’t get into buy-to-let. You’ll thank me!
October 4, 2017
I agree that everybody should be encouraged into property ownership, but shouldn’t you be stopping immigration as a first, and fundamental, step towards this and other goals? Aspiring for mass property ownership seems a rather ambitious objective for a country that can’t even manage its own borders and whose elected politicians don’t have the courage to stand up to the EU.
Immigration other than tourism should be ended. That measure on its own would ease pressure on the housing market, as we would no longer have as many people competing for property, while at the same time employers could find their workers from among the domestic population. Other measures could then be taken to encourage people to marry and have children, so that we have an organically increasing population. Alternatively, we could decide that a decreasing population over the next 20-30 years is not a problem (it will inevitably begin to increase again at some point – these things go in cycles). Either way, once we no longer allow large numbers of immigrants into the country, different policy options can be considered.
Why do we need to import labour? All this does is remove employment opportunities from white British people who need work. It’s also harmful to cohesion in the country and is a threat to our national identity. If necessary, also abolish the national minimum wage and reform social security further so that only those who are genuinely unemployed or otherwise medically unable to work can receive unemployment benefits.
October 4, 2017
Build, build, build: yes please, but not to make council stock. They will only go to incomers and scroungers.
Set up a funded corporation to build and sell 100,000 reasonably sized homes per year. After the initial investment the sales will fund building in subsequent years.
Those houses can be sold at an agreed discount against the market (goldilocks pricing so there is no collapse in the market) or as shared ownership at market rates both options with a long term arrangement for repaying the deposit.
To prevent profiteering the shared ownership should not be convertable to fully owned for at least 10 years and anyone buying at a discount should have it written in to their lease that the property must be sold on at the same discount ratio in perpetuity. This spreads the purchasing opportunity wider.
Some form of control over who can purchase these properties must be in place, I would hope it would be proof of long term residency.
This solution will be anathema to many on here looking for less government involvement but the scale of the issue requires deep pockets.
October 4, 2017
Written into deeds not lease. Apologies – renter’s Stockholm syndrome.
October 4, 2017
O/T
Can someone tell a certain chap that saying the brexit vote was ” the working class having a bit of a tantrum” did the Conservative party no good whatsoever. What an – –
“Ā£$)%&”Ā£*&”Ā£) “Ā£$*&(*)( – -he is.
October 6, 2017
Ah, but he was a very useful idiot to the remain team.
October 4, 2017
After March 2019 a large number of housing apartments etc should be freed up with the departure of EU migrants – the same with student accommodation as we won’t be getting the same numbers coming from overseas. However we will very likely have the influx of old retirees returning home from the continent and a lot of them are going to need to be housed. So what we need is a government sponsored fast build programme of cheaper modular type living structures, good quality, but nevertheless affordable and available. If the Conservative government won’t do it then Labour will have to step in- cut the red tape- make some decisions and just get on with it.
October 4, 2017
No explanation here of how more help to buy is any help at all.
October 4, 2017
Actually, it is not help to buy, it is the return of the old discredited help to sellatevenmoreinflatedprices scheme.
October 4, 2017
If the government thinks housing is a good investment then they should keep that economic secret to themselves lest less honest people get involved in the housing market. Let’s see government use its “own” money and invest a thousand times more in housing. It is a bargain after all. Government, government, government, what would we do without your wise counsel on our budget. The inevitable profits gained can be used to pay MP pensions…without money coming from ANY other source. Every MP will vote for this, won’t they š
October 4, 2017
Government help to buy. Pushing up prices and being used by immigrants to buy property which in many cases is then let.
I see this near where we live.
Build more houses and import more foreign builders requiring even more housing and so on ad infinitum.
Nothing about reducing the massive influx annually causing the problem.
October 4, 2017
There is an excess of tax and regulation that increases costs , but reduces young peoples ability to buy. Particularly so for first time buyers who are graduates. As a couple they could already have Ā£60,000 in debt hanging round their necks. Add to that the cost of transport to work, rail or car and they have every incentive to emigrate.
There is not much sign of innovation in the building industry, wedded to the idea that putting brick on brick is the way we do it, but at the expense of quantity and quality. They operate like our car builders in the 60’s. Controlled factory building like cars are made now makes much more sense.
Apart from the current situation encouraging young people to emigrate, how about incentivising a reduction in population such that demand for housing will fall. At Ā£10,000 per capita it would only cost Ā£10 billion per million.
October 4, 2017
You give every impression of being a very vindictive politician. Moderate or not I am content that you are aware of what I think even if no one else does.
October 4, 2017
So socialist Theresa May’s solution is (needless to say) more intervention, more government and more council houses. These are subsidised properties, paid for by taxes on some to unfairly subsidise others. They are also unfair competition for the private developers and landlords sector and so kill some private provision.
Just as the “free at the point of use” NHS and education are unfair competition and create dire virtual state monopolies. It is totally the wrong way to go. Councils through absurd planning restrictions are the problem not the solution Theresa!
Why on earth did this woman ever become a Tory MP? Not a Tory bone in her body.
Also it seems she will play the race card today in the David Lammy mode. This with her race disparity audit lunacy and “everyone should have a grievance” agenda. A total inability to understand that correlation does not prove cause (hopefully the statistic chief will point this out to her instead of totally wrongly attacking Boris). Thank goodness for the common sense shown by people like Munira Merza.
Does Chairman May think that the huge disparity in gender in our jail shows massive anti-male discrimination by the police, law and order and judicial systems? Time to grow up at your age dear!
October 4, 2017
Amazing that by putting higher and various forms of taxation on housing the government now wonder why sales are not fluid enough.
Can I suggest some very simple solutions:
Control immigration and to start, but only start, to control the demand.
A house is a place to live, a refuge, a home, where people are cared for, and care for themselves and or their family, so why on earth should it be taxed in any way when bought or sold.
Thus abolish stamp duty completely.
It is recognised that people who own their own homes tend to have more of a stake in the community, thus home ownership should be encouraged.
Improvement of housing should be encouraged, so all home improvement work to be VAT Zero rated.
Remember MIRAS, perhaps the Government should bring this back instead of offering the rather inflexible and limited homebuyers loan Scheme.
Exclude the complete value of a house which is the family home, and used as a primary residence from Inheritance Tax.
Plenty of other ideas, but it would be a start to get things moving.
October 5, 2017
Any particular reason this has been held in moderation forfeit days..
Would not have thought it that long.
October 4, 2017
High prices are not only dictated by supply. Mortgage credit and low interest rates are responsible for probably most of the rise in prices. Gradually restricting mortgage credit would prevent house prices continuing to rise and simultaneously force banks to look for other sources of revenue – perhaps by lending to SMEs which is what they’re supposed to do.
It has to happen gradually of course. Moreover, lending for the purpose of buying a home can be kept constant by encouraging other non-bank lenders whose lending doesn’t affect the money supply.
At any rate, only talking about supply without addressing the monetary and credit related reasons for house price growth will not get you very far.
October 4, 2017
Politicians always bang on about the supply side, making their big pronouncements of building more homes, but seem allergic to doing anything about the demand side. They seem incapable of understanding that there are two sides to a market, supply and demand.
We are a small over crowded island and we will never ever being able to out build the demand of people wanting come here to live, not unless we want to turn our island into one heaving mass of sky scrapers.
For the moment as a reasonably stable society , though our politicians are trying to unpick this, we are a very attractive place in which to store money in property . There has to be limits to the foreign ownership of property .
October 4, 2017
Buying has got to be the best option and maybe homes where you half buy and half rent initially is a good idea. People make the mistake of renting before buying which takes up so much of their money in rent they cannot save for a mortgage deposit.
Renting might be good for some people who move with their jobs but for others with children it can be disastrous. Our friends have rented a property in a very crowded area where any property is like gold dust. They have two children at school and settled. The landlord has announced he is going to sell the house and trying to find another property to rent in the same catchment area is proving difficult. Overall people want to own their own home and have the peace of mind of knowing they can stay or leave when it suits them. With such high demand from immigration and land prices so high for building it means that house prices are going through the roof. The stamp duty and other expenses don’t help anyone. As others have mentioned, planning restrictions can be a serious impediment. More sites with run down buildings on them that are listed should be used for housing. Instead they are allowed to sit there looking an eyesore and useless to everyone. I am amazed at the number of agricultural fields now being built on. Worthing is particularly bad. No extra infrastructure in place either. Hospital beds being taken out and no extra schools etc. The roads are hell. Land is being bought by supermarkets and developers years ahead and often gets sat on for years. Quite simply we have too many people for too few houses in England. I am sure it is not climate change that is to blame for the demise of wild animals and birds but less land for them to inhabit.
October 6, 2017
Lots of people in my family had to live sometimes up to four years in their parents or grandparents spare bedroom to save up a deposit, which meant no foreign holidays, no high-cost rental cars, lots of walking and using public transport (which, where I grew up, was infrequent and entailed long round-robin journeys that took an hour to get to work for a 15 minute typical car journey) and conserving funds and making sacrifices. First homes were often doer-uppers that took years of hard work to repair and improve.
October 4, 2017
A mortgage naturally becomes the primary debt of a family to repay. It is in the family’s economic interest as they see it to improve it, spoil it as if child, not affording another child too ( ! )………….Of course further loans and further debts to a credit card (s) must be used to fuel the mortgage repayments and “improvements” to the property. A definite MUST is for a young couple, to stay in love and importantly together as one economic unit throughout the term of the mortgage. MPs should table a motion or whatever, in Parliament to the effect that in all mortgage agreements given to couples it must be stated. “This mortgage can only be given to couples who can prove beyond a shadow of a doubt that they will stay in love and live together for at least twenty years and they will put the procreation of children as a poor second and so guarantee continued and regular mortgage payments.”
October 4, 2017
Concreting over England, to house the world ……
Shut the immigration door.
October 4, 2017
The massive mammoth in the room that the establishment refuses to recognise. Today’s speech from the PM highlighted everything that’s wrong with the current Conservative party and why I won’t be voting for them at the next election; not unless May’s gone by Christmas and a proper conservative made leader.
October 4, 2017
“Years of inviting in large numbers of people to live and work in our country against a background of building too few new homes for them and for the natural growth of the settled population has left us short of decent homes at affordable rents or prices.”
As a poor voter I don’t recall being asked if I wanted to invite ‘large numbers of people’ to come here.
Withdraw that ‘invitation’ and most of our current problems will go away. The ‘settled population’ hasn’t had natural growth as we discourage family life and encourage homosexuality, transgenderism and abortion. We are watching the end of Western civilisation and anyone that says that is so is told to shut up – “Enough (disent) is enough”.
October 4, 2017
Build more houses. What other solution is there?
October 4, 2017
The two conditions that have caused the housing market to reach the difficulties it has are duties and the rate of increase in population . Another is the level of personal debt that now exists ; in the past people saved and budgeted in their life style today those attitudes have disappeared .
The countryside is threatened with the level of increased building and the knock-on effect of transport density has got out of control . We cannot possibly continue the way things are without drastic change . Agriculture and the supply of food are other important considerations ; if we cannot support the population with our own domestic supplies , we are ever more dependent on imports and the inevitable loss of price control .
In a nutshell it is the population increase that dominates and it highlights why we must have control over immigration .
October 4, 2017
I’m sorry, off topic š
Getting back to Catalonia’s bid for independence, this does have some huge “knock-on” effects for the UK and Brexit.
1. Catalonia declares independence, it’s fair to assume the Spanish government will send in the Spanish army to retain control. Will they also call on the EU’s rapid reaction force, namely the German commanded Bundeswehr with its Dutch brigades?
2. Overnight Catalonia becomes a “Third Country” to the EU. What divorce bill will the EU demand, how will they deal with the very large land border, what about citizens rights and trading?
3. Scotland and the Basque Country will be watching this very closely as it’s a route that they will no doubt consider for their own independence.
4. Currency, I’m sure that they will continue to use the Euro, but with no ability to adjust interest rates or issue their own Euros
My point 2. I’m sure that we know how the EU will handle that…Catalonia will overnight become the 29th EU country, problem solved…or will they?
As a net recipient of EU funds why would they want anything else?
So are the EU caught between a rock and a hard place over Brexit? lets hope so and can David Davis turn this in to a Brexit win-win despite Mrs May and Mr Hammond?
October 4, 2017
Many, more than a few persons not managing repaying their mortgages have had their houses either bought by the Council or Council-influenced housing associations or private buy-to-let landlords and then turned over to immigrants, refugees, EU temporary migrants…in “posh ” areas too…in fact , especially “posh” areas as people tend not to be close knit and do not therefore know who is moving in only a few yards away from their “dwellings”. Eventually they find out. The government should not be afraid of Council House “dwellers” .Oh, I see, it is because they tend to be British and stick together. I understand Government concern on that one.
October 4, 2017
Congratulations to Boris for a superbly rousing speech yesterday. Should put all the conspiracy theorists in the media back in their boxes. Best of luck to Mrs May, hope she spells it out to conference and the EU that we are leaving March 2019, and to put it simply that the EU are time limited on procrastination, they have the option of doing it the hard way or the easy way. Either way we become a sovereign nation once more.
Well done the SNP for diverting all that investment in shale gas extraction to the potential in England. What with Corbyn’s tax on robots and this piece of Scottish denial, it seems the Luddites are out in force on the left.
Nice to see the EU continuing to alienate an increasing number of it’s members from Catalonia to Poland. Their parliamentary vote was a big piece of socialist irrelevance I felt. Good of Nigel to redress the balance.
October 4, 2017
āThe older generation include people who have more property than they want, reluctant to sell owing to the tax costs in doing so and buying something smaller. The younger generation includes many people who would like to buy the family homes but cannot afford to.ā
1. There are too few smaller houses to down-size to with buy-to-let and too few built.
2. Builders prefer the margins on 4 and 5 bed properties – so build more of them.
3. Social engineering by government edicts make many mix developments unattractive.
BUT, if you look at the tax benefits to a buy-to-let investor over a buy-to-live-in person anyone would think the government was anti-home owner! Just look at the personal tax breaks. You can rent out properties and off-set your costs in the same way someone running a LTD company would, but without the corporation tax, or other costs. Recently, there have been moves to stop this but there is a long long way to go.
Any move to reduce the cost of housing is welcome because the market is completely rigged in favour of the many players other than those who simply want to live in them.
October 4, 2017
If you were Chancellor Mr Redwood, so many of the self inflicted problems that the govt currently face would soon be resolved.
October 4, 2017
For some time the BBC Daily Politics has been sending a reporter around to test opinions through a so-called “Mood Box”, with two transparent compartments into either of which each person can place their ball to express their view on a certain question.
But yesterday at the Tory party conference to test the attendees’ views on immigration they dropped that usual approach of a simple binary choice, and instead put up a chart with different targets for annual net immigration on a vertical scale, and invited each person to position their blue button at their preferred level.
The pattern which emerged was interesting, with a distribution of responses centred on the government’s stated target of < 100,000 a year* but stretching both up and down on either side of value.
This is what I would like see done nation-wide in the form of an official referendum in which voters were asked to choose their preferred level of immigration; the government should then set their target at the median response, that is to say the annual number which half of the voters thought was too low and half thought was too high.
I would promise to accept the result of that democratic exercise with good grace, unlike some of those who were on the losing side in the EU referendum.
* As originated by David Cameron that was "tens of thousands", implying a few tens of thousands, but it has been subtly changed to "less than a hundred thousand".
October 6, 2017
The question should be preferred level of immigration in your Borough, or County/City
October 4, 2017
Don’t think Tories have a real vision at all for the UK. Totally tunnel-visioned by Europe.
Europe important – but not that important. First, we should focus on paying off national debt. And focus on many other important areas of our country, including helping to build up our high tech sector (so we’re less dependent on the financial sector, important as that is) – supporting start-ups and small and medium-sized businesses to become the Apples, IBMs, Oracles, Googles, Amazons of the future.
And only then focus on Europe. With a proper strategy in place to make it work for businesses.
October 4, 2017
The big problem with renting as against buying is that it never, ever stops – it just gets more and more expensive. Maybe o.k. when working, but can you retire and still afford the rent? With downgraded pensions (ruined mostly by Labour) and poor annuity returns the answer is most likely ‘no’. Try retiring on the current Government Pension plus a small (unless you have a government employee pension) and you will soon find that you have to work until the grave.
Renting on a large scale will cripple this country in the end, both by rapacious landlords whose rents do not allow for saving and for governments who will in the end have to support people who cannot work in old age and cannot afford their rent. Buying must be made the default position. I know the Continentals seem mostly rent, but on the whole I think they have lower rents and certainly better pensions – ours are the lowest in the civilised world, where once they were the best. Thanks Politicians for your short sightedness, just to see you through your term of office.
Builders also need controlling. In my town there is a new ‘garden suburb’ being built with 1200 rabbit hutches on small strips of land. I will never be convinced they cost 250 grand to build which seems to be the start price.
October 4, 2017
You have to look at the way people privately rent and address this in social rentals too.
I’m hearing about more of my parent’s generation moving into extensions built onto their children’s properties.
Teenagers are having to house share with 3 to 4 others especially in London, Lounges are converted into bedrooms and conservatories built on the back for a new lounge/diner with just the kitchen and bathroom to share. Do social housing trusts have this as an option for teens who get kicked out at 19 when the benefits train stops rolling in.
People are building extra bedrooms into their loft space to create extra children’s bedrooms in two bedroomed houses, why can’t social rentals do this and create four bedroom homes from two for bigger families that are stuck on waiting lists for over five years.
Years ago my Nans Council house and her six neighbours had such big gardens the Council did a land grab back and put six bungalows in that space and still left big gardens for the social tenants.
I read about a group of ex-council house tenants who with their children’s help converted their little block into a luxury block adding double the flats onto the floor plan for their own families to benefit from, we should be looking at these options in London rather than pile more homes on inaccessible, poor transport connections and already overcrowded road networks.
October 4, 2017
Looks like Boris and David Davis are desperate to get out of Brexit. Because they think it’s going to be a fiasco and/or worth far more time/trouble than its worth (and not denying they don’t want to be leaders in the future).
The Tories need to re-think Brexit. The approach and timing is awful. And it doesn’t really have the support in the country to last the 20 years or so it would take to make it work.
We’re better off remaining in the EU, whilst setting up a team to reform the EU for our benefit (and for the EU’s). And focusing on paying off our national debt and the other important pressing national issues.
No shame in trying with Brexit. But there is shame in not being pragmatic and recognising when things are going seriously wrong. And still opportunity for Brexiters to shine – not by getting the UK to leave the EU, but by trying to get the EU reformed.
October 5, 2017
Looks like you are intent on doing maximum damage to our country.
October 4, 2017
So having sold off 1.9 million Council houses at a net loss to local government, you now want to replace them. Having created the largest ever private sector unearned capital gain bonanza; you want to repeat it with a fixed period rental, coupled to a repeated state giveaway Right to Buy. Buying votes is getting very expensive.
October 5, 2017
I dread the return of council housing on a large scale. It was social and economic apartheid: some children grew up knowing they had to work hard and save to buy their own house, while others knew they didn’t have to. We were indeed two nations – until Mrs T’s policy of making us a property-owning democracy through the biggest redistribution of wealth the working class has ever benfited from.
October 5, 2017
I too know people who knew they didn’t have to work hard, transfer housing between themselves and know all the loopholes to get social houses and private rentals paid for by the State. Transfer of council housing to Grandchildren was another good one – keep the benefits within the family.
October 5, 2017
There were 4.4 million council homes in 1997 when Labour came to power, and just 2.3 million when they left in 2010. Seems like they sold off even more.
October 4, 2017
Lastly, the socialists are seriously breathing down our necks. If they get into power, Brexit is going to unravel anyway, and with it, our country’s economy.
Brexit is now just becoming more and more unachievable – a pipe dream. Not saying it’s not workable in theory. But not when we have big national debt and all kinds of other national problems. And not when it hasn’t been planned for properly. And there isn’t the leadership in place to coordinate something controversial and as complicated as a ‘moon landing.’
Time to return to good, old British, Conservative, pragmatic common sense, and realise the game’s up for Brexit, i think.
October 4, 2017
The housing market is a good example of how dominance of vested interests, government intervention, legislation and taxes makes what is purely a problem of supply and demand that free market capitalism left to it’s own devices has been solving for generations in to one that is intractable to solve. It is like watching a leaking ship in a gale as the crew rush around plugin one hole only for another to appear somewhere else. Then that can be said of most of what government does exacerbated by when a relatively competent crew is changed with one that is not at all competent. The danger being that they will sail onto the rocks. Up to now that has not quite happened but there have been some close calls. The next change may see that happen.
October 4, 2017
How is it politicians are always making speeches full of promises and platitudes. Last week Corbyn, today Mrs May- its like theres no end to it..every year promises promises but as always very little done
October 4, 2017
She coughed it up didn’t she?! Again
October 4, 2017
This view “Some years ago there was a strong establishment view that the UK needed to be more like the rest of the EU with a larger private rented sector. ”
Was factually wrong, Spain has only 17% renting.
The rest of the EU is not a monolith – which you would expect Europhiles to know.
I agree with you 100% although I would call stamp duty “moving tax”.
October 5, 2017
In the EU, only Denmark, Austria and Germany have lower rates of owner occupation than the UK. In the East European EU countries, owner occupation is at much higher levels – countries where the state owned the housing until the fall of Communism.
October 4, 2017
What a goddam awful speech ! From arrogant CEO to arrogant Trades Union Leader, whatever the mind-numbing and mind-dumbing content, you would retire from the artificially elevated talking spot on an artificially elevated stage when you could not stop coughing.
Even at this crisis point with home-grown terrorists killing our people and lack of housing and education and health for all she cannot bring herself to STOP immigration and admit her own responsibility in the foundation work in those murders and homelessness. Coward!
Her resignation should apply now.
October 4, 2017
I’ve a great idea. Tell Hammond to stop spending my money, reform the public sector, confront the unions, confront the State’s vested interest, slash Govt spending, cut taxes
Politicians love spending money because they think spending is viewed favourably by the public. Cutting State spending is therefore viewed unfavourably. of course they use the convenient unseen leverage that is sovereign debt to plug the debt and of course the public is unable to SEE the national debt. The public can see a new bridge, a new hospital, bigger wages for the unproductive public sector
The Tories are addicted to State spending because they fear the opposite will damage them.
The greater amounts of cash politicians have to spend the greater their political power becomes.
Debt will destroy this country and not one single party is prepared to stand up and confront the issue
October 4, 2017
http://www.express.co.uk/news/politics/862205/Conservative-party-conference-2017-Theresa-May-speech-live-Lee-Nelson-P45-jeremy-corbyn
The security needs looking into if a muppet like nelson can get so near to the PM
October 4, 2017
Hilary Clinton famously had a similar throat moment as Mrs May. They are both finished, however. The coughing episode…one wishes it were symbolic. Humans are not perfect. It is FrĆ©dĆ©ric Chopin’s Piano Sonata No. 2 in Bā minor, Op. 35. for her political career, illogically I admit. But the end, nevertheless.
October 5, 2017
Don’t be silly March Hare it’s normally Spring you guys go mad.
October 4, 2017
Why are you now so quiet on the Brexit topic? Your views sound similar to Boris’s with his stirring, optimistic speech. I am worried about the way things are slipping away from us and it is sound, well-informed people like you who should be shouting for a clean break. The UK should stop negotiating and leave it to the EU to come up with suggestions or we walk away to WTO.
October 4, 2017
Its’ good to hear that there will be more money for affordable housing after listening to TM’s speech. What I did find pathetic was the slagging off both the BBC and ITV gave her for COUGHING????? What on earth are they going on about? The poor woman has a cold and she at least shows she’s human. Why be so degenerate about her for a human failing? Pathetic.
October 5, 2017
I agree: she couldn’t help the cough, the interloper, or the falling f. But she was responsible for the speech she read out, whoever wrote it, and it was ghastly, embarrassing, depressing stuff, as it so often is with her. She made the odd good speech in the days of Timothy, when under pressure from the Commission, but now she seems to be taking dictation from them, and from some very dim people in no 10.
October 5, 2017
I agree it’s becoming very fishy.
A prominent bracelet with a communist supports picture – who gave it to her, or if she bought it was she aware of the identity of the woman in the picture?
The letters dropping off a sign – who built this sign? Who ordered it? How much did the Conservatives pay for it? Let’s know the Company that did this?
The chap that was sat close enough to the front to get to the lectern so quickly and was brazenly allowed to approach the PM and then casually walk back to speak to Boris Johnson – just ridiculous.
Just three things that are odd and slightly pathetic to be making such a big thing of, yet our media news is going crazy over it – so bizarre.
October 4, 2017
The housing vision might have something to do with the PMI construction numbers out yesterday at 48.01, and has been falling since April, from 56 plus reading or could say from the last neoliberal globalist budget on March, 2 billion might go some way to fix it.
October 4, 2017
Muddled messages. Government says land will be available but what will local councils do? Bank of England indicate interest rates will rise and some in government say immigration will not be capped. Not much point in building where there is a lack of useful and remunerative employment.
Problems have been created by governments for almost 20 years, particularly by immigration, and it is expected that private housebuilders, who are in it for a profit, will provide the solution. Government should get directly involved through housing associations or local councils.
Young people who are unable to buy homes gradually feeling more and more resentful and that is fertile ground for Labour.
October 5, 2017
Really how are Labour proposing to help middle-class working kids to buy their own homes?
October 4, 2017
I see that overseas aid & people had the best part of may speech.
October 4, 2017
The neoliberal globalist tory party has slaughtered it’s country and people over the last 8 years.
October 4, 2017
Amazing they got elected considering your claims.
October 4, 2017
The planning system was introduced on the basis that it would control the supply of buildings, including but not limited to dwellings such that supply would match demand. It has signally failed to do so. House prices have been rising above general inflation since 1948, and have leapt ahead since the Government decided to allow mass immigration and the planners failed to plan for it.
Apart from the shortage imposed by planning restrictions, the high demands for section 106 payments mean that developers need to sell at a high price in order to fund the payment.
As stated above the only answer is to eviscerate the T&CPA. That will produce a vast increase in homebuilding which will continue until demand is met and the price of “development land” falls to match that of agricultural land.
Perhaps the planners could be redeployed as building inspectors.
If the government is desperate to do something it could fund housebuilding on ex-industrial sites unattractive to developers- but the properties built should be eligible for private ownership, maybe through right to buy.
It seems to me there are many Conservatives who simply wish to continue the status quo, and not reverse old mistakes. I had not previously thought you one of them.
All the “clever” schemes to help young homebuyers simply change who gets first pick, they don’t make housing cheaper.
That said I think it would be politically necessary to compensate those whose houses lose value from when they were bought before the abolition of planning, partly to retain their support and partly to ensure that they still have collateral for their mortgages.
October 4, 2017
I’m greatly amused by reports that some wag at Conference handed the PM a P45 during her keynote speech….it seems that the honourable lady may be looking for new accommodation in the near future…maybe she will accept one of the new council houses that Hammond wants to build:)
October 4, 2017
Will Alan Duncan move in next door and lend his neighbor some money?
October 4, 2017
And Theresa Mays answer, not understanding and dealing with the things that you hilight the government have done to skew the market, no a socialist solution. Throw more money at it. No doubt my council tax will go up as councils gear take on massive new departments to run these new council homes. She is personally taking charge. What does she know about whether house builders have the capacity in terms of people and working capital to ramp up their output to meet her numbers? I think there are skills shortages. You need a prefabricated revolution to turn out the egg boxes these houses will surely be. Incidentally when you talk housing policy you must link with industrial strategy using planning and tax breaks to get business to move to what are still desolate and broken down cities further north still suffering from the loss of traditional industry. Banging another few thousand houses in the already suffering and overcrowded south east, although easy cannot be any sort of solution.
Good to see the perjorative label ārip offā being aimed at the power companies, again sounded like a socialist and following their policies which she so roundly condemned when suggested by Miliband. Serve you right if they cut back investment. Incidentally will you ask her to stop using the elderly as a reason, it is insulting condescending rubbish and I wouldnāt want to be in the other two groups that she thinks are too stupid to look at comparison web sites.
I am of mature years but have, in the main, managed to reduce or keep level my bills over
the past five years or so. You might like to point out that there are millions of computer literate silver surfers who she insults every time she uses them as an excuse for one of her policies.
Finally I see that most of the Cabinet did not turn up to hear Boris. Do Hammond, Rudd, Fallon etc really think that their doom laden boring glass half empty approach is going to win over anyone let alone the young, because if so they are wrong? Not one iota of hope from any of them.
Theresa May lost her voice. I think just ālostā would be more appropriate.
October 4, 2017
“Just what WILL it take for you to sack Boris ?” Laura Kuenssberg.
Yet again this woman is trying to make the news and not report it.
October 4, 2017
Anon
I am afraid Laura K is getting more and more rude as time goes on, with her questions/statements given the manner in which they are now being asked.
She certainly seems full of her own self importance.
If I were the PM I would simply refuse to speak to her.
Whilst I am no fan of Trump he put her in her place.
October 5, 2017
She is polite by comparison with Eddie Mair and Beth Rigby.
October 4, 2017
There is a need for sticks as well as carrots to free up houses that are too large for the people living in them.
Introduce two new higher bands of council tax.
Make the discount for single occupancy fixed across all bands at say the current band d rate
October 4, 2017
It’s the young who benefit from the single occupancy rate. There’d be a riot if you removed it!
October 5, 2017
How many young people do you think can afford to buy a home bigger than a D band home?
October 4, 2017
Why should people be forced to leave their homes via a ‘stick’ just to cover for government incompetence over the years and continuing? Making moving cheaper would be a better idea, although we are talking ‘homes’ not just houses and people may have their lifetime memories etc. and want to end their days there. Not everyone wants to live in a shoe box on an appalling modern estate after a lifetime of effort. Smaller houses and bungalows other than that just don’t exist in any numbers. Your wing of the party seems to be the ‘nasty’ side. Not many votes in that, I’d say.
October 4, 2017
One point about pensioners holding onto their family homes (apart from sentiment) is that they represent the fund for future care home costs. That is certainly the case for us and I know many friends who plan similarly. We are not going to downsize now because we don’t need the money yet and we would forego future capital gains. Our children have known our plan for many years and are happy with it.
October 4, 2017
More council houses? I take it with more sink schools for their children? And more sink NHS services for the residents? No parking for workers?
Why am I not impressed?
Please stop pissing my money down the drain FFS
October 5, 2017
They’ll all end up in areas with all the council houses now, no area should have more than 15% Council homes and if they have them they need balancing out so every Borough has 15%.
October 6, 2017
The buying power and decision making should be with individual citizens and not top down state planning, in housing, in schools, and in healthcare provision.
October 4, 2017
Devolve stamp duty to councils. The rates should be set to suit local people. London can spend it on crossrail 2. Other areas can cut rates to their boost competitiveness.
October 5, 2017
The Welsh have just increased rates on homes over Ā£500,000 above those in England. The Scots also have higher rates. Interesting to see how it works out.
October 4, 2017
All very sensible. To reduce stamp duties would increase housing turnover and shake out many properties for better use.
The most obvious and most pressing problem though is to control immigration, and unlike Mrs May who is continuing with the policies we voted against and wants all immigrants to stay, I say we should encourage as many as possible to return. It would soon start to reduce the pressures.
And maybe some thought should be given as to how a matket could be made for properties to be offered on long repairing leases and also on the basis that the incoming tenant fits their own kitchen for example. They would thus have a stake in keeping the property in good order.and the rent would of be much lower than otherwise. This might appeal to some in between short term rentals people have suffer from now and ownership.
October 5, 2017
Some Remainers deny that the net migration of around 300k, or perhaps many more if NI stats are to be believed, has not affected house prices. If the Nationwide house price index relative to income is combined to show affordabilty ( available on websites), then migration is superimposed, the two lines match almost exactly. If migration to various regions of the UK are superimposed similarly, there is also a match. I sent the graphs to JR.
It makes one wonder whether anyone in government ever explains the figures to Mrs May. She has just offered the EU an extra 2 years of free migration on top of the 2 she has already. Another 650k people will need housing, many in one bedroom flats. How many extra council houses is she offering to build and what size will these be?
Councils used to offer to guarantee rents and reliable tenancies in order to find private rental homes, generally at a return of 4% in London. Some friends took up the offer when they went to retire abroad. They returned to find rent unpaid and their flat trashed. Many landlords currently have 3 or 4 bedroom house which they are unable to let to more than 2 tenants, owing to harsh and expensive HMO regulations and aggressive councils. If councils could be trusted, many more rooms would become available.
October 4, 2017
Security is red hot in the UK except at the soft underbelly as personified in the Tory Party Conference where one does not expect danger of any kind.
October 5, 2017
Yes, everyone was very calm weren’t they! I was expecting a martial arts tackle to the floor but it was all very casual.
October 4, 2017
The answer is of course to drastically reduce immigration as requested by 80% of our population and continually promised by the Conservatives to obtain votes but which is totally ignored when in government.
It is isnāt just housing which needs to be built for our rapidly expanding population but hospitals, surgeries, schools, roads, power and water plants, prisons etc etc. This is unaffordable particularly when it is a continually reducing proportion of the population who actually pay any tax.
This is in addition to the enhanced destruction of the environment caused by continuous building and the additional population.
The Conservatives donāt know how to solve the housing/population problem as their core voters donāt want to see a building free-for-all with no planning laws and their corporate funders donāt want to see a reduction in the availability of cheap immigrant labour.
October 4, 2017
I would be interested in your views regarding the Welsh Govt. s first Budget which will increase Stamp Duty by 2.5% over that imposed in England.
October 4, 2017
Anyone who wants an example of bias at the BBC could do no better than listen to the first half hour of Wednesday’s PM programme. ( 17:00-17:30 4th October 2017 ).
In 45 years following politics, I have never heard a hatchet job as seriously biased against one political party as the one carried out by Carolyn Quinn and Eddy Mayer.
Quinn had almost noting positive to say about Mrs May’s speech and Mayer’s interview with Amber Rudd was an utter disgrace. All Meyer’s personal and nasty dislike of the party and Mrs May were on open display. I am sure the programme will generate a lot of complaints but, as usual, the BBC will ignore them.
This was so blatantly biased that an official complaint should be launched by the party or at least by a prominent MP such as our host. It is time that the BBC was brought to heel. This is the perfect example with which to start a campaign.
October 4, 2017
I’ll tell you what’s real..after todays performance by the PM it’s very unlikely she’ll survive the next few weeks..you could see it in Boris and Michael Gove..the body language tells it all
October 5, 2017
She’s been set up, I’m no big T.May fan but it stinks.
October 4, 2017
Dr Redwood,
Labour has a proper socialist leader – why can’t the Conservatives have a proper conservative!.
What does she have to do to get dispatched to the back benches ?. She spelled out in her speech that she is a politically correct liberal (an observer would gain the impression the police can do no right and are always worthy of suspicion and minorities can do no wrong in her world). How dare she use her platform to attack the West Yorkshire Police it was totally inappropriate.
Then she signalled her approval for social housing – a policy that will surely gain zero Labour votes but annoy a great number of Conservative voters with the prospect of council houses in their backyard. I thought the Conservatives stood for self reliance and home ownership.
Redwood for PM come on JR!
October 5, 2017
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Build, build, build: yes please, but not to make council stock. They will only go to incomers and scroungers.
Set up a funded corporation to build and sell 100,000 reasonably sized homes per year. After the initial investment the sales will fund building in subsequent years.
Those houses can be sold at an agreed discount against the market (goldilocks pricing so there is no collapse in the market) or as shared ownership at market rates both options with a long term arrangement for repaying the deposit.
To prevent profiteering the shared ownership should not be convertable to fully owned for at least 10 years and anyone buying at a discount should have it written in to their deeds that the property must be sold on at the same discount ratio in perpetuity. This spreads the purchasing opportunity wider.
Some form of control over who can purchase these properties must be in place, I would hope it would be proof of long term residency.
This solution will be anathema to many on here looking for less government involvement but the scale of the issue requires deep pockets.
October 5, 2017
Until we have a plan to move away from ZIRP houses will remain expensive relative to incomes. Normalising money markets should be a priority, so that investment is sensibly rationed into productive projects. That applies to government fostered white elephants as well.
October 5, 2017
I’m very frustrated about the Conservative Party’s policies on housing. When we talk about the ‘young’ not getting on the housing ladder, we are really talking about most people under 40. Throw in high private rents (hence low savings), tiny interest rates and poorly paying stakeholder pensions and you have a disaster in the making.
The mortage lenders generally offer 3.5x a couple’s annual income. Imagine Joe and Joanne Average want to buy a house. The average salary in the UK is ~Ā£28K, and the average price of a house Ā£200K. So our average couple are going to have to save up over Ā£100K whilst paying rent (Ā£921 per month average). The sums don’t work.
What is going to happen when this cohort reach retirement? It will be very difficult to make ends meet paying private rents on lousy stakeholder pensions. Does the Conservative Party really think people in that situation will vote for them rather than the Socialists? Because I don’t. After all, land taxes are only bad if you have landed assets, whereas social housing means you can heat and eat on the same day (unions willing).
I never warmed to Theresa May, but I did think that she grasped this problem. Yet we’ve had the ‘beer tomorrow’ housing pledge in the manifesto, the awful Help-to-Sell policy which is there for the benefit of Foxtons et al., not younger people, and a pitiful pledge to build 5000 council houses a year. It is nothing.
October 6, 2017
Housing benefit should buy equity rather than rent; when a greater than 50% stake has accrued anyone should be allowed to force a sale at public auction.