House building targets scrapped.

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www.theguardian.com/politics/2022/dec/05/sunak-backs-down-on-housebuilding-targets-after-pressure-from-tory-mps

I am surprised there isn't a thread on this already on a parenting forum because this really does threaten British preferences and social norms. Most british people want to live in a house with garden. I was just on a thread where a poster was trying to decide whether she should downsize from a house to a flat in her preferred location and the prevailing consensus was that flats were no good for babies, should have a house with garden where the children can play in etc etc. This isn't the norm in many countries in the world, but it appear to be the norm in the UK outside London. However, what this norm depends on is LAND. in cities where there is generally less opposition to building, they tend to build flats due to the high cost of land.

The reason why so many British people live in houses today is because there was a house building boom in the 1930s and then the 1950s where they built lots of houses. Including ex council houses with gardens in the 1950s. I own a 1930s flat and when i read local history, it was literally opposite an actual farm. So while it is suburban london today, it was considered quite a rural area when it was built and completely different in character; today I am a 2 minute walk to a dry cleaners, a bakery, a small local supermarket/deli, a breakfast place and a 15 minute walk from a tube station that takes me to central london within 20 minutes.

So scrapping house building targets would mean that the future houses for the young Britons of today would not get built while the population is increasing. As every area would be able to object to housebuilding if it 'has an impact on the local character'. If this was the case in the 1930s, my flat would never have been built. And perhaps I wouldn't have been able to afford to stay in London as the only properties available would be Victorian workers cottages, flats above shops and grand mansions.

I think that this does not bode well for young people. As my friend said, if he did not have the means to buy property, he would definitely leave the UK. This could potentially engineer a London style housing crisis even in affordable regions of the UK. Never mind about houses for young families, I think 50% of the population would be struggling to rent. I read a stat that 25% of renters are either returning to the family home or would do so within the next year. This is the situation in 2022; how much worse would it be in 10 years time?

And no increasing mortgage rates would not help with this. You need the supply.

Govt are the only people to have the capital to be able to manage it
And those despicable cunts are only interested in siphoning money into their own back pockets
We have a prime minister who is wealthier than the king, a pampered rich boy with no idea how real people live
During the pandemic they made like bandits and they are still doing the same

We actually have more homes than households in the UK. We've built more homes than new households have been created consistently year on year for decades.

So we don't need to build more.

What we also have though is excess demand for properties fuelled by asset chasing after years of printing money and rock bottom interest rates.

It's the overall economy that's fucked. Nothing to do with how many houses we build.

What about all the housing stock that stands empty because it's been brought up by wealthy overseas investors, our infrastructure is owned by other countries and our people can't access it

Not just overseas investors. Plenty of homegrown Airbnb etc owners too. A country with a million holiday lets is not short of properties. The problem with a country like this - like we are, now - is a more fundamental one about the drive for asset acquisition in an economic environment where money is worth less every year.

i think the house price crash is beginning. But it doesn't mean renters can buy homes if they are dependent on 90% mortgages to do so as banks will scale back lending. It may mean that some rich renters who could probably have afforded to buy a small house or flat pre crash can now afford a bigger house. Or some people can move up the ladder as its cheaper to move up in a falling market (provided that they have their jobs, and can sell their current property,, they would probably have been paying off the mortgage for the past few years and built up equity). Its all very nice for them but if there is no supply, it may mean that house prices rock back up again.

What is needed is house price crash + increase in supply + 5% interest rates. I say this as a homeowner. I only own one property to live in so high house prices do not benefit me. I would rather house prices decline over time in real terms so that I don't need to fund the deposits of any future children.

then how come there is a shortage of rental even in my area of suburban london? Its 20 minutes tube ride from central london so not really an airbnb hotspot. Overseas investors don't buy it to lock up and leave (they tend to buy them in westminster and kensington). There is foreign money here, one of my potential buyers is a very young graduate who like me is from another country, did her undergrad here and is now working here. She only graduated last year so the money is probably coming from parents. But she is buying to live in.

There shouldn't be a shortage of rental if it was only a question of easy credit.

I've no idea where you live or what's happening in your street.

This isn't just about credit though. All asset classes eg gold, art etc have increased in price since we started printing money. We started printing it in 2008. Since then anyone with money has been buying assets. Anyone with access to credit has done the same. That's close to a generation ago, it's been going on for.

Millions of people in the UK own two or more properties. We are not short of properties. We are relatively fucked when it comes to secure affordable homes to live in though.

We've done other things too that devalue cash. Tax credits and universal credit for eg. £26 billion a year going to people through that. Housing benefit is another £12 billion a year. This is money that doesn't come from output but it is still spent. So there's a gap between spending and productivity. A £38 billion a year gap running at or around that rate for ten years and to a lesser extent although still fairly big for ten years beforehand. Who even knows what money means these days, in the UK economy? All we can do now is chase assets.

UC and tax credits is because minimum wage doesn't pay enough to support a family esp if single parent. Also quite a lot of people who are long term sick and can't work. Housing benefit is because the government sold off all the council housing so therefore we need to pay private landlords .

i am not sure how you can avoid paying that without mass homelessness and destitution. This also creates a burden on the NHS. if my mentally ill friend had access to supported housing, she probably wouldn't need to be sectioned 4 times this year alone, each time spending a few days at A & E while she waits to be triaged, taking up a bed and a room. Also every time she gets sectioned, the police officers spend approximately 4 hours with her- wouldn't they be better off catching criminals or doing something productive rather than escorting a 45 year old woman to the hospital. Also if she was in supportive housing, she wouldn't be able to spend her money in shops during her manic episodes- this has meant she has qualified for UC in record time. I am aghast at the welfare and healthcare system, it is such a waste of money doing the things that they do, and so hard to get the appropriate support for her.

Yes I know wages are too low. But topping them up isn't the answer and makes the productivity gap worse.

I mean to be clear wages need to be higher. Banging state money at employees while devaluing currency and leading asset acquisition is a disaster in itself but employers complete the vicious circle by failing to pay enough for a tolerable adult life.

What we also have though is excess demand for properties fuelled by asset chasing after years of printing money and rock bottom interest rates.

It's the overall economy that's fucked.

Basically

I worked in the housing sector for many years - i've heard all of those arguments before and none of them convince me. And I often heard the 'it's not that I'm against new housing, it's just that they shouldn't be built HERE'. Lots of people would very happy if no new housing was built anywhere, ever.

Not building houses doesn't solver any of the issues you've raised.

I'm overjoyed that they are going to stop building round here. They've already filled thousands and thousands of acres of prime farmland with huge new estates full of 3 and 4-bed houses costing upwards of half a million, and covered the land in between with endless bypasses to bypass the previous bypass. We are on the outskirts of commuterland, and young people can't afford to buy anything round here anyway. All the flats and starter homes are already owned by BTL landlords.

We need loads of 2-bed housing round here, but developers don't make enough money out of them, so they don't bother.

This is the kind of thing I'm talking about. Places where a third of homes are holiday lets. A lot of these places, the only "industry" is buying houses in them, bussing domestic tourists of modest means into them and selling them cups of coffee and scones. These places don't do fuck all, they don't produce fuck all, people working in the coffee and trinket shops earn fuck all and the only activity of value happens when the holiday let gets sold on to the next investor.

There's no shortage of properties. There are almost more properties than there are residents. But residents don't have a lot of money and increasingly they can't be homeowners.

www.theguardian.com/technology/2022/oct/18/sharp-rise-airbnb-listings-coastal-areas-england-wales

FTB are a lot older now so maybe a 3 bed is a sensible choice for someone in their 30s. I only bought a 2 bed because when we bought in 2019, the threshold for stamp duty exemption for FTB was 500k and i realistically couldn't get a 3 bed flat in my preferred areas for that. Now the threshold for stamp duty exemption threshold is 625k so in even in commuterland that could be an ok budget.

I am against airbnb and have never used airbnb in my life out of principle. I stay in a hotel instead. That way, I don't feel like i am staying at someone else's potential home. In my home country, they banned airbnb. This caused a lot of headache for my MIL when she visited my home country as she doesn't use electricity on saturday (we had to pay for meals to be delivered) and hence cannot use hotel keycards but her right to stay at a property with no electronic keycards doesn't trump the right of local residents to safe and secure housing. I would support councils banning airbnb here too.

Yes it's a problem - you have town after town where the only real economic activity is buying and selling houses. Now that will continue forever, until suddenly it doesn't, but it has nothing to do with what people earn. Same as the housing market in general has little to do with what people earn. How it behaves is driven by credit and acquisitions. This part of the economy is entirely out of whack with earnings and with the factors that drive earnings including productivity and investment. That's why there's an affordability gap. There are loads of bloody houses. There's never been more, relative to the number of households. But if like most median income and below working households you support yourself with wages you will struggle to fund a house purchase.

From a site:

'This line of argument, that there cannot be a shortage where there are empty homes, is quite intuitive. But is it right? To put it bluntly, no. Comparing the number of homes with the number of households is a poor way to measure housing need. In fact, the government specifically warns people not to make this mistake in their guidance on calculating how many homes are required.
The reason for this is that the formation of new households is constrained by the availability of housing: a household cannot exist without a home.
As a result, the number of homes will always be greater than the number of households. If there aren’t enough homes available, this pushes up the price and people stop forming new households: they stay with their parents, they share a home with friends instead of getting their own place, and they put off having children.
We have seen all of the above becoming more common in London’s rental market. These people become “concealed households”: households trapped within another existing one. Just under 12 per cent of London households, about 400,000 of them, are thought to contain a concealed household. A statistic, but one that contains a shocking degree of misery for the many people wanting to start their own independent lives.'

@LadyVictoriaSponge incorrect, my company build on a lot of brownfield sites.

they can't build if the residents reject it as often planning permission would not be given! Of course they can and have done so many times, I don't mean to be rude OP but you sound very naive, it doesn't matter how many people object, planning can still be given and public consultations are generally lip service.

You guys do realise that some of the land in London isn't actually owned by the UK, right? I know of one patch of large land in central London that is owned by Russia (who won't sell it) it is getting more and more profitable for them!

a 6 storey block of flats (along with retail and office space) in my area has been rejected for being too tall and overlooking a forest due to resident objections.

It was very funny reading all the resident objections. One resident wrote that her block of flats was 4 storeys (so they should be aligned). LOL.

^a 6 storey block of flats (along with retail and office space) in my area has been rejected for being too tall and overlooking a forest due to resident objections.* What will probably happen is the plans will be adjusted slightly, they'll go back to the Architect and the developer will re submit the plans to the council, you're not out of the woods because plans have been rejected unfortunately.

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