AIBU to think that the UK housing crisis is not caused by supply and demand?

[Goodnightseamer]

It's often trotted out as a reason but there are 29 million houses in the UK. There are slightly fewer than 28 million households. That's over a million houses more than there are households. So there are plenty of houses. Houses are unaffordable due to speculative investment, not under supply. AIBU?

Micheal heseltine specifically argued, and included in the housing act at the time, that income Should be used for new house building. As I said, it didn’t really happen- And yes that in part was because the use of receipts started to become more and more restricted.

The 2016 act has opened this back up but again, I don’t believe it will actually happen.

It’s not fair to say it was forbidden- I’ve just done a quick google and the rate of building new social housing didn’t slow until 5 years after the act was introduced. By which time
Heseltine had been moved on and the use of receipts had started to become more restrictive.

The thing is that rental prices are so high in some areas now that mortgage payments are actually lower than rent pcm

Honestly, it used to be even worse. We bought our house off our old landlord in 2001, and our old rent payments had been £800pcm. Our repayment mortgage was £560pcm, and we had a 95% mortgage. If we rented it out now, we’d get £1600pcm, and looking at mortgage calculators, a new 95% mortgage would be about £1900pcm (it’s gone up in price from £110000 to about £450000-500000, we haven’t extended or anything, that’s just how much prices have risen round here).

So while I agree rents are too high, selling prices are also ridiculously unaffordable now - there is no way our two bedroom flat in Brixton is worth half a million quid, it just isn’t.

I see houses on rightmove that have been on the market for about 18months. Three bed terraces on for more than a million, when I can see that it was bought for half of that three years ago. Then people complain they can’t sell. Sellers are greedy these days.

It's far more complicated than that.

George Clarke did a very informative programme on council/social housing in the U.K. a few months ago. I remember one part of it talking about how the council only receive a tiny percentage (the number 10 is in my head but not sure if % or £k in ten example used) of what the house is sold to the tenant for.

18% of new build sales in London are to foreign investors. This is higher than anywhere else in the world, including New York. And that's just new builds. There has also been a flurry of high end existing properties spurred by the weak pound.

There was a new build block of flats near me, they sold the entire block in minutes to foreign investors.
It was like they were buying concert tickets.

This isn’t the first housing crisis. It was much worse in the 30s. Slums and high rents. It took until the 70s for these to be completely cleared and demolished or renovated.

We have a new slum issue- I have no philosophical objection to private LLs (I don’t think councils were/ are good LLs)- but we need tighter rules about housing standards and security of tenure.

Other countries have better tenant protection, restrictions on foreign ownership, higher property taxes, bigger minimum house size, etc

Also I think it’s daft that housing benefit was restricted to rent and not also available for mortgage payments.

It would be better for the public purse for a severely disabled person who can never work to have a mortgage paid for 25 years than rent for 80 years.

It’s expensive being poor. My mortgage was hundreds a months cheaper than renting and you can’t even hang a picture of your dcs!!