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politicalbetting.com » Blog Archive » The inter-generational gap: The Pinch and the Punch

SystemSystem Posts: 3,967
edited October 1 in General

imagepoliticalbetting.com » Blog Archive » The inter-generational gap: The Pinch and the Punch

 

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  • First?
  • I haven't been first since I topped the poll in the town council election in 2015...
  • Dear me, another Ferrari shocker and they haven't even started the race...
  • SandpitSandpit Posts: 13,797
    FPT:

    F1: 15 mins to go, track is damp but probably dry tyres. Rain possible, nay probable in the next two hours. Rumours of turbo problems with Raikkonnen’s second place starting Ferrari, to add to Vettel’s Ferrari having turbo problems yesterday...

    Edit: Kimi pushed off the grid, starts from the pit lane if they can fix it.
  • SandpitSandpit Posts: 13,797
    Congratulations on the 1-2-3 Mr Pioneers.

    Congratulations to Mercedes on the Constructors’ championship!
  • On topic, Capitalism has broken. Go back to the Victorian time and the great pioneering capitalists - Rowntree, Level, Cadbury etc - all knew that if you wanted to succeed you needed a workforce with comfortable homes and leisure time and an income sufficient enough to buy the things they sell.

    At the moment we have a ludicrous situation where wages haven't kept up with inflation for most of the last decade combined with an explosion in housing costs and a steady rise in prices of goods. Which means a lack of disposable income which cheap bank loans have filled - but you can only tip so much debt onto already embattled consumers for so long before the whole thing starts to collapse.

    We need rental controls as a starter for 10.
  • ydoethurydoethur Posts: 7,169
    edited October 1

    On topic, Capitalism has broken. Go back to the Victorian time and the great pioneering capitalists - Rowntree, Level, Cadbury etc - all knew that if you wanted to succeed you needed a workforce with comfortable homes and leisure time and an income sufficient enough to buy the things they sell.

    At the moment we have a ludicrous situation where wages haven't kept up with inflation for most of the last decade combined with an explosion in housing costs and a steady rise in prices of goods. Which means a lack of disposable income which cheap bank loans have filled - but you can only tip so much debt onto already embattled consumers for so long before the whole thing starts to collapse.

    We need rental controls as a starter for 10.

    Rental controls, as Shelter points out, would probably make matters much worse by simply getting rid of the supply. If all private landlords sold up, house prices would drop but that won't help people without the money for the deposit. At the same time, renting would become damn near impossible. As war communism showed, it's all very well saying you can have x amount for y price, but if x isn't there to start with it's irrelevant. (If that's too old, try perestroika - they had coupons to buy socks, but there weren't any socks to buy.)

    What we need is a supply of suitable rental housing. For that, council house building is the way to go as renting solid houses of the right size is unprofitable compared to putting up either shoeboxes or luxury housing. Equally, there's not, Corbyn's more insane promises on massive borrowing aside, the money to pay for it. So that would leave us, irritatingly, with either nothing or PFI which in many ways is worse.

    If I had an easy solution I would share it. But beware that Corbyn's solutions are an extreme form of Politician's Logic.

    (BTW, people confidently predicted capitalism had broken beyond repair in the 1930s too as the Soviet heavy economy took shape and the Western economies struggled in the Depression. But that turned out to be premature as well. I do however agree that companies should think more about their workers and providing for them, but please remember as well that the three you list were the exception not the rule. Mining houses in the South Wales Valleys were awful.)
  • Madness in Spain
  • I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

  • I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
  • I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
  • AlastairMeeksAlastairMeeks Posts: 17,017
    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.
  • I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    Rent controls never work
  • ydoethurydoethur Posts: 7,169
    edited October 1

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    That's an idea with some merit, but the problem is in the current state of the housing market I think even with a 20% drop in prices you would still pay more to buy than to build. So the question of money remains.

    I am also concerned about the wrong kind of houses but equally, if we have more and more people in the country we have to build more and more houses. If our population increases by a third in twenty years, they have to go somewhere. That does mean building new houses.

    I know one poster (I think it was Alistair) put forward flats as the alternative but they tend not to be what most people actually want. So they can end up distorting matters further.

    I would add that if large numbers of 60s towerblocks become unusable as well due to fire safety concerns that will make matters considerably more difficult.

    Edit - and Alistair helpfully confirms he does think of building upwards.
  • DavidLDavidL Posts: 16,570
    The desire to do something about this is clear. The ability to do so is another question entirely. So what does the government need to do?

    1. Increase housing stock in much of the country substantially, both to buy and to let. Its time the NIMBYs (mainly BBs) got told to get stuffed.
    2. Increase interest rates and essentially drive down house prices. It may seem perverse to reduce the affordability of housing when trying to increase the proportion of home ownership but it is very low interest rates that are driving the high prices to the profit of the BBs in possession.
    3. Keep Osborne's much criticised help to buy policy. There is a risk that falling prices would make the deposit requirements even more severe. FTBs need help with this. Also if new build is going to be available there has to be demand for it.
    4. Follow through on the more obvious parts of the 2017 suicide note/manifesto and start taking ridiculous freebies from the well to do retired to help the hard up young workers. Even if the numbers are not huge the message is.
    5. Reduce both the fees and the interest rates on student loans.
    6. Improve workers rights to give additional protections to those "self employed" in the Gig economy. Employment Tribunals are heading this way and there is an important case on the go right now but it is a trend that needs to be encouraged, not resisted.
    7. Beef up tax reliefs on training and use the government's purchasing power to force more investment in training as a condition of public sector contracts.
    8. Reinvigorate the college sector.
    9. Start to address the huge intergenerational unfairness being caused by public sector pensions and retirement packages.
    10. Listen carefully to what younger people want out of the Brexit deal and prioritise those objectives.

  • AlastairMeeksAlastairMeeks Posts: 17,017

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    Rent controls would make it much easier for nice middle class people to buy flats. They would make it harder for poorer people to find any accommodation.
  • Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time
  • ydoethurydoethur Posts: 7,169

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    But even if every BTL property in London was put on the market, the correction would be insufficient for tenants to buy or to make it plausible for councils to buy on their behalf.

    So ironically rent controls could very easily lead to the kind of social cleansing they are designed to avoid.
  • AlastairMeeksAlastairMeeks Posts: 17,017
    ydoethur said:

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    That's an idea with some merit, but the problem is in the current state of the housing market I think even with a 20% drop in prices you would still pay more to buy than to build. So the question of money remains.

    I am also concerned about the wrong kind of houses but equally, if we have more and more people in the country we have to build more and more houses. If our population increases by a third in twenty years, they have to go somewhere. That does mean building new houses.

    I know one poster (I think it was Alistair) put forward flats as the alternative but they tend not to be what most people actually want. So they can end up distorting matters further.

    I would add that if large numbers of 60s towerblocks become unusable as well due to fire safety concerns that will make matters considerably more difficult.

    Edit - and Alistair helpfully confirms he does think of building upwards.
    Needs not wants. Anyway, a lot of it is about poverty of imagination. Courtyard blocks are common across much of Europe, use space very efficiently and can be very stylish.
  • There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    That is the only answer. The rules of supply and demand dictate that to reduce cost supply has to be increased
  • SandpitSandpit Posts: 13,797

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    Agree completely. Tinkering around with the demand side makes very little difference when more and more people want to live in London, things like help-to-buy and rent controls only exacerbate the situation. The only solution to London housing is to build more units. Lots more units.
  • ydoethurydoethur Posts: 7,169

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    If I were feeling facetious I would draw a slightly cruel parallel with the Conservative manifesto.

    More seriously if the Spanish government were actually trying to provoke a UDI and a civil war they could scarcely be doing a better job.
  • DavidLDavidL Posts: 16,570

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
  • SandpitSandpit Posts: 13,797

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    ... they’ll leave them empty and sit on the asset, which is bound to appreciate considerably in the long term.
  • ydoethur said:

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    If I were feeling facetious I would draw a slightly cruel parallel with the Conservative manifesto.

    More seriously if the Spanish government were actually trying to provoke a UDI and a civil war they could scarcely be doing a better job.
    You would never be facetious would you!!
  • ydoethurydoethur Posts: 7,169

    ydoethur said:

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    If I were feeling facetious I would draw a slightly cruel parallel with the Conservative manifesto.

    More seriously if the Spanish government were actually trying to provoke a UDI and a civil war they could scarcely be doing a better job.
    You would never be facetious would you!!
    You know me, Mr G, a man of the utmost seriousness who would never make a bad pun or a silly suggestion. I leave that kind of thing to the Cambridge educated hoi polloi on here.
  • ydoethur said:

    ydoethur said:

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    If I were feeling facetious I would draw a slightly cruel parallel with the Conservative manifesto.

    More seriously if the Spanish government were actually trying to provoke a UDI and a civil war they could scarcely be doing a better job.
    You would never be facetious would you!!
    You know me, Mr G, a man of the utmost seriousness who would never make a bad pun or a silly suggestion. I leave that kind of thing to the Cambridge educated hoi polloi on here.
    Great answer
  • CharlesCharles Posts: 17,319
    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.
  • MortimerMortimer Posts: 8,101

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    Rent controls would make it much easier for nice middle class people to buy flats. They would make it harder for poorer people to find any accommodation.
    Agreed.

    Building up makes sense. As does building new towns. Not everyone wants to live in a city.

    The other issue not talked about enough is the foreign ownership of residential property. This needs to be addressed; the commoditisation of homes is bad enough when it is 'nice middle class' BTL landlords, but when they're empty stores of wealth for wealthy foreigners not using or renting out, it is even worse.

    Tax unoccupied property at 5x the normal rate. Or annual repeat of the purchase price stamp duty unless relatively continued occupation.
  • ydoethurydoethur Posts: 7,169
    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    When I took out my student loan interest was charged at the rate of inflation, so in real terms the money I paid back has stayed the same. The repayment threshold increases at the same rate. That at least is fair and sensible.

    In a field of stiff competition, the decision to change that to a commercial rate - and I've got a feeling it was actually before the coalition - is the stupidest HE policy this country has ever had.
  • CharlesCharles Posts: 17,319

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    Why didn't they just say "this is an illegal vote and has no weight"

    UDI would be a big step for Catalonia.
  • The one thing Corbyn has achieved is to change the political discourse. As unelectable as he is with his hard left policies it has forced the conservatives to address these issues, particularly by Osborne who was abysmal with the young
  • ydoethurydoethur Posts: 7,169
    Charles said:

    Photos of brute force and injuries to defenceless young people emerging from Barcelona

    This is absolute madness and will put a schism through Spain that is not going to be healed for a very long time

    Why didn't they just say "this is an illegal vote and has no weight"

    UDI would be a big step for Catalonia.
    They did but they were ignored. I think they were afraid that if the 'Yes' vote amounted to more than 50% of eligible voters, which it may have done even with a complete boycott by 'No,' then their case against independence would be holed below the waterline given UN rules on self-determination.
  • MortimerMortimer Posts: 8,101
    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
  • BenpointerBenpointer Posts: 1,603
    Can I just say what a great thread header this is - a very well articulated and sensible analysis. Restores my belief that the current crop of Tory leadership contenders do not represent the whole party.
  • ydoethurydoethur Posts: 7,169
    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    He increased it and cut the repayment threshold, but I think a higher rate was brought in with top up fees under Blair. I could be wrong but I seem to remember a lot of angst about it.
  • With respect to the "build more" argument - we are building! And upwards as well, has anyone compared the price that new apartments are going for in London and other major cities with the wages people are paid?

    Its not the supply thats the major issue its the price. A lot of people in cities have no interest in buying, they want to rent. And rents are set at the "market price" based on the cost to buy which is astronomical.

    I'm open to other ideas. But the cost of housing has to be reduced and reduced significantly if we want the rest of the economy to thrive. Suck increasing amounts of people's wages into housing and thats money thats not available for them to spend on everything else.
  • not_on_firenot_on_fire Posts: 1,955
    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Student loans are currently far more expensive than inflation - up to RPI+3%. That the discredited RPI is used at all is a disgrace given that the government has switched to CPI for benefits. I think charging at the rate of inflation is fair enough otherwise the rich can effectively use the loan as an investment.

    Surely the other key question is why it costs £9000 a year for a history degree with 10 hours a week (over about 30 weeks) of contact time?
  • AlastairMeeksAlastairMeeks Posts: 17,017
    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
  • ydoethurydoethur Posts: 7,169

    Its not the supply thats the major issue its the price. A lot of people in cities have no interest in buying, they want to rent. And rents are set at the "market price" based on the cost to buy which is astronomical.

    It's set at the market rate of the cost to rent, which based on my 15 years as a tenant is rather different and usually also much higher.
  • AlastairMeeksAlastairMeeks Posts: 17,017

    With respect to the "build more" argument - we are building! And upwards as well, has anyone compared the price that new apartments are going for in London and other major cities with the wages people are paid?

    Its not the supply thats the major issue its the price. A lot of people in cities have no interest in buying, they want to rent. And rents are set at the "market price" based on the cost to buy which is astronomical.

    I'm open to other ideas. But the cost of housing has to be reduced and reduced significantly if we want the rest of the economy to thrive. Suck increasing amounts of people's wages into housing and thats money thats not available for them to spend on everything else.

    Reducing the desirability of letting out will reduce the numbers of property that are let. That's why rent restrictions were relaxed originally. Rental properties were very hard to find.

    By and large, the people making the noise are the people who want to buy.

    And we're not building enough.
  • GardenwalkerGardenwalker Posts: 1,096
    House prices are a consequence of the great asset inflation created by QE. Interest rates are basically zero, and prices have shot up accordingly.

    So the problem is demand rather than supply.

    There are certainly significant supply side problems. The housing development market seems like an oligopoly, and the new housing being developed is some of the smallest / worst quality in Europe. It's almost impossible to be a small scale developer. That needs fixing.

    But to really reduce house prices you must dampen demand, by toughening mortgage lending requirements. As this would put the ordinary house buyer at a disadvantage to the cash rich 1% or the overseas buyer, there perhaps is a case for further taxes or controls.

    Of course, London prices are already falling...
  • AlanbrookeAlanbrooke Posts: 15,756
    One has to marvel at David Willetts sheer hypocrisy

    the man who whacked kids with ridiculous uni fees now wonders why the young havent got money

    git
  • DavidLDavidL Posts: 16,570

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    I fear a lot of them will be used as working week bases for those with houses further out. They seem very small to be main residences.
  • ydoethurydoethur Posts: 7,169

    Surely the other key question is why it costs £9000 a year for a history degree with 10 hours a week (over about 30 weeks) of contact time?

    It doesn't. Usually it costs about £2-3,000.

    However, it can cost up to £30,000 to train a science graduate, and since they can't charge full fees for that, they need to recruit as many cheaper students in history, English, politics, business, art etc to make up the shortfall.

    The other elephant in the room is Education - strangely, that's one of the more expensive degrees because of fees paid to schools. Which is of course why the DfE are frantically closing down education departments and moving to SCITT routes, even though they know this is a less effective way of training on the whole.
  • BenpointerBenpointer Posts: 1,603
    edited October 1

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres (or is that pieds-a-terre? - anyway second homes) for the super-wealthy?
  • CharlesCharles Posts: 17,319

    With respect to the "build more" argument - we are building! And upwards as well, has anyone compared the price that new apartments are going for in London and other major cities with the wages people are paid?

    Its not the supply thats the major issue its the price. A lot of people in cities have no interest in buying, they want to rent. And rents are set at the "market price" based on the cost to buy which is astronomical.

    I'm open to other ideas. But the cost of housing has to be reduced and reduced significantly if we want the rest of the economy to thrive. Suck increasing amounts of people's wages into housing and thats money thats not available for them to spend on everything else.

    Basic problem is low interest rates.

    When base rates were at 3-4%, yields on rental properties were in the region of 6-7%. When base rates fell to 0.5%, yields (talking about London super prime) compressed to around 3-3.5%, effectively doubling the price of properties.

    This pushed a large number of people into the rental market (as they couldn't afford the higher prices for houses, especially with the increased deposits/regulations on lending limits vs salaries).

    More renters drove up rental prices...resulting in higher purchase prices...
  • AlastairMeeksAlastairMeeks Posts: 17,017

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
  • ydoethurydoethur Posts: 7,169

    House prices are a consequence of the great asset inflation created by QE. Interest rates are basically zero, and prices have shot up accordingly.

    So the problem is demand rather than supply.

    I'm not at all sure that's correct. I would have said house prices outside London have been static ever since the crash, although they were rising fast beforehand. I don't know enough about London to speculate.

    Of course you could argue the mortgage boom was a form of QE, just with money created by banks over-leveraging rather than by the BoE buying up gilts.
  • CharlesCharles Posts: 17,319
    edited October 1

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Student loans are currently far more expensive than inflation - up to RPI+3%. That the discredited RPI is used at all is a disgrace given that the government has switched to CPI for benefits. I think charging at the rate of inflation is fair enough otherwise the rich can effectively use the loan as an investment.

    Surely the other key question is why it costs £9000 a year for a history degree with 10 hours a week (over about 30 weeks) of contact time?
    Signalling.

    The problem is that if you cap the rates then everyone wants to charge the cap - because they don't to be perceived as less good. There's not an effective market in fees - which is what the government hoped to achieve.

    But someone needs to address the course structure. Buckingham manages very well with 2 year courses - but equally they don't do much research, and HEFC funding/academic career progression is very tied to research/publication vs teaching.

    (Although, on your specific question 10x30 = 300 hours of contact time which equals £30 per hour: not a completely outrageous price to charge).
  • SouthamObserverSouthamObserver Posts: 24,104
    Good article - thanks.

    One point, though: the Right to Buy made a lot of people very well off, so it's no surprise it was popular. However, in many parts of the country - and in London, in particular - a large proportion of former council properties are now buy-to-let properties. All that's changed is that rents are a whole lot higher and tenants are less secure. Not sure that's great policy.
  • TykejohnnoTykejohnno Posts: 6,635

    One has to marvel at David Willetts sheer hypocrisy

    the man who whacked kids with ridiculous uni fees now wonders why the young havent got money

    git

    Makes you wonder how he got the nickname two brains.
  • ydoethurydoethur Posts: 7,169
    edited October 1

    Good article - thanks.

    One point, though: the Right to Buy made a lot of people very well off, so it's no surprise it was popular. However, in many parts of the country - and in London, in particular - a large proportion of former council properties are now buy-to-let properties. All that's changed is that rents are a whole lot higher and tenants are less secure. Not sure that's great policy.

    It was the PFI of its day, wasn't it - no clauses put in the sale to say that it could not be let out, or if it was to be, the council should be given the option to buy it back first. That said, there are some restrictions - my house has covenanting consent on it for example - but as they are usually ignored that doesn't help.

    Anyway I have a mighty three manual organ to play for harvest festival, and appropriately I am going to have to go out into the soft refreshing rain. Have a good morning.
  • Richard_HRichard_H Posts: 48
    Good article on a subject i find interesting.

    The question i would raise, it what would we do, if Political parties did not exist and there was no attempt to manipulate policies to target voters ?

    Student loans and other costs meaning a typical debt of over £50k for a University course make no sense at all. Yes there is long term repayment offered, but having discussed the issue with a couple of senior people dealing with Student Loans, management of these debts is proving a real pain in the *ss. No matter how much they try to enforce repayment of these debts, there are too many people not paying. It is estimated that over 50% of these student debts will be written off over a long period of time. The Government sold off loads of older student loan debts and the debt buyers are no longer interested, as they got their fingers burnt. They found that there was just too many problems with the administration by SLC, deferments, correspondence about no payment etc etc. Trying to gain payment by litigation if necessary was just proving more difficult than with Banking debts.

    On housing costs, this is not just a UK issue, as they have the same problem in many countries. There is more demand for housing than supply. If you build more houses, then you have to invest in all of the infrastructure to support it. This means an increase in Government debt, as well as private/Bank debts in mortgages to buy new housing. I am not sure any political commitment to build millions of new homes is that honest. The cost overall would be enormous. So any new house building will continue at the slow rate it has over recent decades. Government could enable local authorities to borrow to supply properties on rent to buy schemes and that might make a difference.

  • SandpitSandpit Posts: 13,797
    The Malaysian track will be missed by F1 - great racing here.
  • GardenwalkerGardenwalker Posts: 1,096
    ydoethur said:

    House prices are a consequence of the great asset inflation created by QE. Interest rates are basically zero, and prices have shot up accordingly.

    So the problem is demand rather than supply.

    I'm not at all sure that's correct. I would have said house prices outside London have been static ever since the crash, although they were rising fast beforehand. I don't know enough about London to speculate.

    Of course you could argue the mortgage boom was a form of QE, just with money created by banks over-leveraging rather than by the BoE buying up gilts.
    Yes, spot on. Started before QE with the mortgage boom, self-certifying craze of the 2000s. QE has just kept the balloon in the air, at the expense of a whole generation.

    Actually, at the expense of most.
    It's not just those trying to get on the housing ladder. It's also those who'd hope to step up - the rungs on the ladder have got bigger.

  • BenpointerBenpointer Posts: 1,603

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).
  • GardenwalkerGardenwalker Posts: 1,096
    edited October 1

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).
    There's already a stamp duty surcharge for second homes. Perhaps it could be increased. The surcharge should, by the way, be applied also to purchases by foreigners.

    We need measures to reduce the attractiveness of housing as an asset class. Not only does it inflate prices for people who just need a first home, its an unproductive use of wealth.
  • WinstanleyWinstanley Posts: 250
    As rotten as the funding model is for undergrad for various reasons it's worse for postgrad, where it's often funded by Career Development loans with repayments starting immediately once you finish, with 9.9% interest. For courses with often a fraction of the contact time.
  • foxinsoxukfoxinsoxuk Posts: 22,424
    ydoethur said:

    House prices are a consequence of the great asset inflation created by QE. Interest rates are basically zero, and prices have shot up accordingly.

    So the problem is demand rather than supply.

    I'm not at all sure that's correct. I would have said house prices outside London have been static ever since the crash, although they were rising fast beforehand. I don't know enough about London to speculate.

    Of course you could argue the mortgage boom was a form of QE, just with money created by banks over-leveraging rather than by the BoE buying up gilts.
    House prices are affordable in Leicester, and even cheaper in Stoke where TP works.

    The problem of housing is mostly in SE England. Elsewhere it is mostly a problem of opportunity.
  • AlastairMeeksAlastairMeeks Posts: 17,017

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).

    Honestly, some people are impossible to satisfy. The cry goes out: build more flats in London. Then the cry goes out, no, not REALLY nice ones, that'll only encourage them.

    I suppose the preferred solution is to build moderately attractive flats, certified by an architect as adequately mediocre.
  • Casino_RoyaleCasino_Royale Posts: 21,487
    edited October 1
    Good post, Aaron.

    The thing that strikes me is that, on both sides, Labour and the Conservatives are trying to rig the market. Labour, with rent controls and price controls. The Conservatives, with help to buy.

    You can't rig the market. Neither work.

    This is a classic case of supply and demand. Supply is too restricted (not enough homes built fast enough where they are needed) and demand increases all the time (population growth and immigration).
  • BenpointerBenpointer Posts: 1,603
    Charles said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Student loans are currently far more expensive than inflation - up to RPI+3%. That the discredited RPI is used at all is a disgrace given that the government has switched to CPI for benefits. I think charging at the rate of inflation is fair enough otherwise the rich can effectively use the loan as an investment.

    Surely the other key question is why it costs £9000 a year for a history degree with 10 hours a week (over about 30 weeks) of contact time?
    Signalling.

    The problem is that if you cap the rates then everyone wants to charge the cap - because they don't to be perceived as less good. There's not an effective market in fees - which is what the government hoped to achieve.

    But someone needs to address the course structure. Buckingham manages very well with 2 year courses - but equally they don't do much research, and HEFC funding/academic career progression is very tied to research/publication vs teaching.

    (Although, on your specific question 10x30 = 300 hours of contact time which equals £30 per hour: not a completely outrageous price to charge).
    Yes but I presume that's not 1:1 contact time?
  • Casino_RoyaleCasino_Royale Posts: 21,487
    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    How many of them will (a) be bought by UK residents and (b) lived in by them?
  • Casino_RoyaleCasino_Royale Posts: 21,487
    Mortimer said:

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    Rent controls would make it much easier for nice middle class people to buy flats. They would make it harder for poorer people to find any accommodation.
    Agreed.

    Building up makes sense. As does building new towns. Not everyone wants to live in a city.

    The other issue not talked about enough is the foreign ownership of residential property. This needs to be addressed; the commoditisation of homes is bad enough when it is 'nice middle class' BTL landlords, but when they're empty stores of wealth for wealthy foreigners not using or renting out, it is even worse.

    Tax unoccupied property at 5x the normal rate. Or annual repeat of the purchase price stamp duty unless relatively continued occupation.
    For non-UK nationals or non-residents, perhaps.

    If you're an ordinary Briton temporarily trying to rent your old home out, so you can move and buy a new one, and it takes 2-4 months to find a tenant, that would be punitive.
  • BenpointerBenpointer Posts: 1,603

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).

    Honestly, some people are impossible to satisfy. The cry goes out: build more flats in London. Then the cry goes out, no, not REALLY nice ones, that'll only encourage them.

    I suppose the preferred solution is to build moderately attractive flats, certified by an architect as adequately mediocre.
    It's not that. The question is how do you make them more affordable? One option is to disincentivise the demand from second homers... making buy-to-let less attactive is part of that. Getting back to positive real interest rates will help too.
  • AlastairMeeksAlastairMeeks Posts: 17,017
    It is worth noting that London's property prices are currently falling (quite sharply in some areas), so it may be that the last war is being fought there.

    The problems of low wage growth and low productivity are in my view far more pressing.
  • SandpitSandpit Posts: 13,797
    edited October 1
    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    Yes, the loans can’t be sold on if there’s no real terms interest on them, given the horrendous default rates.
  • PClippPClipp Posts: 1,242
    Sandpit said:

    ... they’ll leave them empty and sit on the asset, which is bound to appreciate considerably in the long term.

    The answer to that one is site value rating, obviously. Mr Corbyn`s Labour Party said in their last manifesto that the might "look at it".

    What we need is a good Liberal government.
  • not_on_firenot_on_fire Posts: 1,955
    ydoethur said:

    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    He increased it and cut the repayment threshold, but I think a higher rate was brought in with top up fees under Blair. I could be wrong but I seem to remember a lot of angst about it.
    Wrong - Blair kept the same as the original 1997 scheme (RPI+0%) but the fees were increased to £3000 from about about £1000.

    Source: student in the mid 2000s
  • BenpointerBenpointer Posts: 1,603
    Sandpit said:

    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    Yes, the loans can’t be sold on if there’s no real terms interest on them, given the horrendous default rates.
    Genuine question: are the loans being sold on? If so, how is the write-off dealt with?
  • not_on_firenot_on_fire Posts: 1,955

    Sandpit said:

    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    Yes, the loans can’t be sold on if there’s no real terms interest on them, given the horrendous default rates.
    Genuine question: are the loans being sold on? If so, how is the write-off dealt with?
    The government plans to sell on the loans but hasn’t done so yet. Presumably the risk of the loan being written off is taken account in the price paid.
  • DavidLDavidL Posts: 16,570

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    How many of them will (a) be bought by UK residents and (b) lived in by them?
    The second point is the relevant one. Ownership matters less than the quantity of supply provided that supply is effective. If those earning megabucks in the City use them as pied a terres as an alternative to commuting then their impact is less.
  • BenpointerBenpointer Posts: 1,603

    Sandpit said:

    Mortimer said:

    Charles said:

    Re: University fees

    I have a huge amount of sympathy with the argument that students should pay for their degrees - after all, on average, they are the ones who will benefit most from them.

    Clearly many students don't have the cash upfront, so they need a source of finance and the government is the natural place to find that financing.

    What I don't get is why, if higher education is a public good, the government is so focused on charging interest (even if it is only inflation).

    Wouldn't the easiest solution be to simply say "If you have 3 years of university that is a cost of £27,000 and you have to pay it back". Make that over, say, 10-15 years and it should be affordable for most graduates.

    Agreed.

    Wasn't the interest one of Osborne's wheezes?
    Yes, the loans can’t be sold on if there’s no real terms interest on them, given the horrendous default rates.
    Genuine question: are the loans being sold on? If so, how is the write-off dealt with?
    The government plans to sell on the loans but hasn’t done so yet. Presumably the risk of the loan being written off is taken account in the price paid.
    Thanks!
  • not_on_firenot_on_fire Posts: 1,955

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).

    Honestly, some people are impossible to satisfy. The cry goes out: build more flats in London. Then the cry goes out, no, not REALLY nice ones, that'll only encourage them.

    I suppose the preferred solution is to build moderately attractive flats, certified by an architect as adequately mediocre.
    It's not that. The question is how do you make them more affordable? One option is to disincentivise the demand from second homers... making buy-to-let less attactive is part of that. Getting back to positive real interest rates will help too.
    Land value tax.
  • CarlottaVanceCarlottaVance Posts: 24,952

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    The Georgians were surprisingly efficient at high urban densities and who (apart from the Victorians) doesn't like their stuff? Its the fake Georgian McMansions that put people off - terraces - that's what we need!
  • BenpointerBenpointer Posts: 1,603

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).

    Honestly, some people are impossible to satisfy. The cry goes out: build more flats in London. Then the cry goes out, no, not REALLY nice ones, that'll only encourage them.

    I suppose the preferred solution is to build moderately attractive flats, certified by an architect as adequately mediocre.
    It's not that. The question is how do you make them more affordable? One option is to disincentivise the demand from second homers... making buy-to-let less attactive is part of that. Getting back to positive real interest rates will help too.
    Land value tax.
    Yes - good point!
  • OldKingColeOldKingCole Posts: 9,046

    Mortimer said:

    I'd free local authorities to hoover up BTL homes being sold cheap by landlords who decided there wasn't enough profit in it. Borrowing to buy a cheap asset makes sense as an investment especially when it fulfils a community purpose.

    We can't keep on building more and more and more houses. The developers charter the Tories brought in already means that residents and councils and planning officers can do little to stop developers building the wrong kinds of houses in the wrong locations. Scrap the NPPF is another good step.

    Can you identify any BTL property being sold cheaply by a landlord who says there is no profit in it. A large majority of BTL landlords are in it for the long term as an investment sometimes as a pension fund
    Not at the moment. But if rent controls smash the rate they can charge in places like London...
    Rent controls would make it much easier for nice middle class people to buy flats. They would make it harder for poorer people to find any accommodation.
    Agreed.

    Building up makes sense. As does building new towns. Not everyone wants to live in a city.

    The other issue not talked about enough is the foreign ownership of residential property. This needs to be addressed; the commoditisation of homes is bad enough when it is 'nice middle class' BTL landlords, but when they're empty stores of wealth for wealthy foreigners not using or renting out, it is even worse.

    Tax unoccupied property at 5x the normal rate. Or annual repeat of the purchase price stamp duty unless relatively continued occupation.
    For non-UK nationals or non-residents, perhaps.

    If you're an ordinary Briton temporarily trying to rent your old home out, so you can move and buy a new one, and it takes 2-4 months to find a tenant, that would be punitive.
    AFAIK that’s not a particularly common occurence.
  • BenpointerBenpointer Posts: 1,603
    Scott_P said:
    Haha - brilliant! (But at the same time, very depressing :disappointed:)
  • CarlottaVanceCarlottaVance Posts: 24,952

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    How many of them will (a) be bought by UK residents and (b) lived in by them?
    Significant proportions of new units are bought by overseas residents. The percentage is highest in central London but the total number there is small;

    A clear majority of units bought by overseas investors are let out to Londoners;

    Others are used by owners’ family members, children in education or returning expats, and are fully occupied;
    A small but highly visible subset is lived in only occasionally. However, there was almost no evidence of homes being left permanently empty;

    Pre-sales to overseas buyers enable developers to build faster and thus make more market and affordable housing available than would otherwise have been the case;

    International investment and finance have helped bring stalled sites into use and speed up development on larger sites. They have also been key to creating our Build to Rent sector.


    http://blogs.lse.ac.uk/politicsandpolicy/what-is-the-role-of-overseas-investors-in-the-london-new-build-residential-market/
  • BenpointerBenpointer Posts: 1,603

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    The Georgians were surprisingly efficient at high urban densities and who (apart from the Victorians) doesn't like their stuff? Its the fake Georgian McMansions that put people off - terraces - that's what we need!
    Wasn't that because they relied on the underclass living 10 to a room?
  • SouthamObserverSouthamObserver Posts: 24,104
    In Catalonia the Spanish state is doing exactly as the Catalan separatists had hoped. The pig-headed, obstinate stupidity of the Spanish nationalist PP will deliver Catalan independence:
  • DavidLDavidL Posts: 16,570

    In Catalonia the Spanish state is doing exactly as the Catalan separatists had hoped. The pig-headed, obstinate stupidity of the Spanish nationalist PP will deliver Catalan independence:

    These are not great graphics are they? Catalan support for independence will be much higher after today.
  • rottenboroughrottenborough Posts: 12,024

    DavidL said:

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    There is a massive use of the third dimension on the south bank at the moment but I suspect the prices will not be of much interest to anyone under 40.
    So long as they are occupied they are part of the solution. They will free up other housing that would otherwise have been occupied.
    But how many are just pied-a-terres for the super-wealthy?
    Unless you want to stop the super-wealthy buying pieds-a-terres, they are part of the solution.
    There's no doubt that the demand for second homes drives up the values, often beyond the reach of the young. It's a symptom of increasing wealth inequality in this country.

    The supply of new flats in central London generates demand for second homes that would not necessarily exist if the flats weren't there imo (that couple with the fact that if you have a spare £500k in savings you aren't going to earn anything by keeping it on deposit).

    Honestly, some people are impossible to satisfy. The cry goes out: build more flats in London. Then the cry goes out, no, not REALLY nice ones, that'll only encourage them.

    I suppose the preferred solution is to build moderately attractive flats, certified by an architect as adequately mediocre.
    It's not that. The question is how do you make them more affordable? One option is to disincentivise the demand from second homers... making buy-to-let less attactive is part of that. Getting back to positive real interest rates will help too.
    Land value tax.
    Yes - good point!
    Morning all,

    I'm not an economist, but surely supple and demand dictates that if more homes are built the price inflation should at least stabilise, if not drop?
  • OchEyeOchEye Posts: 637
    PClipp said:

    Sandpit said:

    ... they’ll leave them empty and sit on the asset, which is bound to appreciate considerably in the long term.

    The answer to that one is site value rating, obviously. Mr Corbyn`s Labour Party said in their last manifesto that the might "look at it".

    What we need is a good Liberal government.
    When you find one, please let us know.....
  • JosiasJessopJosiasJessop Posts: 17,660
    Vettel.

    LOL, LOL, LOL.

    It's always someone else's fault, isn't it, finger-boy. ;)
  • Theresa May facing tough questions from Marr
  • kle4kle4 Posts: 26,149

    In Catalonia the Spanish state is doing exactly as the Catalan separatists had hoped. The pig-headed, obstinate stupidity of the Spanish nationalist PP will deliver Catalan independence:

    Couldn't they just have blocked the entranceways even if separatists has already squatted in the buildings themselves? A few people voting is no worry if no one else can get in without getting violent. I suppose it's a more complicated operation than I probably think, but obstinacy from the Catalans as well aside, what's madrids endgame? Given the plans undertaken thus time I should think the next regional elections will have the separatist parties up the ante again, perhaps promising a declaration just for winning that, in which case does Spain just ban the parties for promising illegal action?
  • tlg86tlg86 Posts: 7,087

    Theresa May facing tough questions from Marr

    For a brief moment I was actually quite impressed by her. She showed some fighting spirit talking about a run on the pound under Labour.
  • OchEyeOchEye Posts: 637

    Theresa May facing tough questions from Marr

    And not answering.....
  • kle4kle4 Posts: 26,149

    There is a simple solution to the problem of property costs: build far more of them, especially in London where the main problem is. The third dimension is woefully underused in Britain. You don't have to build tower blocks. Five or six storey mansion blocks would be enough.

    The Georgians were surprisingly efficient at high urban densities and who (apart from the Victorians) doesn't like their stuff? Its the fake Georgian McMansions that put people off - terraces - that's what we need!
    Wasn't that because they relied on the underclass living 10 to a room?
    Good times. You really got to know people intimately that way.
  • tlg86 said:

    Theresa May facing tough questions from Marr

    For a brief moment I was actually quite impressed by her. She showed some fighting spirit talking about a run on the pound under Labour.
    She is under colossal pressure and you have to wonder how most anyone would just not walk away, no matter one's opinion of her she must have amazing fortitude and determination - she is at least a serious politician
  • OchEye said:

    Theresa May facing tough questions from Marr

    And not answering.....
    Or not providing the answer you would like
  • tlg86tlg86 Posts: 7,087
    Interesting, Marr thinks the government's priority when it comes to the railways is the passenger, not the tax payer.
  • OchEyeOchEye Posts: 637

    tlg86 said:

    Theresa May facing tough questions from Marr

    For a brief moment I was actually quite impressed by her. She showed some fighting spirit talking about a run on the pound under Labour.
    She is under colossal pressure and you have to wonder how most anyone would just not walk away, no matter one's opinion of her she must have amazing fortitude and determination - she is at least a serious politician
    A cleverer person would walk away, unfortunately.......
  • SouthamObserverSouthamObserver Posts: 24,104
    DavidL said:

    In Catalonia the Spanish state is doing exactly as the Catalan separatists had hoped. The pig-headed, obstinate stupidity of the Spanish nationalist PP will deliver Catalan independence:

    These are not great graphics are they? Catalan support for independence will be much higher after today.

    I am not too sure about that. But what the pictures will do is move international opinion. And for the separatists that is what really matters right now.

  • PClippPClipp Posts: 1,242
    OchEye said:

    PClipp said:

    Sandpit said:

    ... they’ll leave them empty and sit on the asset, which is bound to appreciate considerably in the long term.

    The answer to that one is site value rating, obviously. Mr Corbyn`s Labour Party said in their last manifesto that the might "look at it".

    What we need is a good Liberal government.
    When you find one, please let us know.....
    There is a good Lib Dem government in waiting, Mr Eye. With more experience of being in government than the Labour Party has. And much more compassion and common sense than the Conservatives have.

    Unfortunately, not as much money as the old parties, with their wealthy backers.

    But by all accounts, with more members that the Conservatives.....
  • Morris_DancerMorris_Dancer Posts: 38,384
    Good morning, everyone.

    F1: thoroughly entertaining race. Alas, we're leaving Malaysia yet Azerbaijan remains.

This discussion has been closed.