Housing costs will kill off high street?

[GreenMushrooms]

Now hear me out - I know there are many dead high streets, and many people with lots of disposable cash. But I recently visited a small town that I have always loved, it is near the south west coast.

Wages are undeniably low in this part of the country, but this town has historically been filled with many boutique shops. With £30 bowls, and £150 trousers - all hand made in the stores. Obviously there is tourist trade, but with housing costs increasing I wonder how towns like this will survive.

Historically there were many people with mortgages of only £400ish per month. Now, for a first time buyer purchasing an average house in the town with a 10% deposit, the mortgage would be more like £1800+. Rent isn't much cheaper with one bed flats £800+. For remortgagers, the interest rate has increased dramatically, increasing repayments.

Judging by previous mumsnet posts, the difference between the "haves" and the "have nots" is often housing costs, when you look at budgets and disposable income.

With less disposable income for residents, how will small independents such as this survive? Surely there will be much less demand for "little luxuries", especially in low income towns. This won't just put the boutiques out of business, but it will fundamentally change the shape of such towns. Turning them into the average run-down high street.

YABU - someone will always have money and towns like this will always survive

YANBU - increased housing costs have dramatically reduced disposable incomes, meaning these town centres will fail

I feel like the whole of the uk's wealth is tied up in housing. Either paying mortgages or rent. And until we come up with a better way of housing us all the economy isnt going to thrive.

I know. There are so many more productive things to spend money on - such as supporting small or innovative businesses - but it feels like housing sucks up so much of people's money.

And housing isn't "productive" as such or value generating in that way. Even mortgages feel like rentierism, but paying to banks.

They were all on life support anyway.

They won’t survive.

I think we’re heading for a recession with redundancies much more common, so I agree OP.

There's a woman in my town who's always on her Instagram stories lamenting that no-one has come in her shop all day. She sells ludicrously expensive candles that are beautiful, but just too expensive for anyone to afford. I feel sorry for her because it's a gorgeous business but no-ones rich enough to support it regularly.

£150 trousers are not a little luxury!!! A fancy chocolate bar, a dodgy candle, a fancy bath foam these are little luxuries. £150 trousers are madness.

£150 trousers could be considered cheap, depending on how complicated they are and what the material is. Minimum wage is to be £11 an hour soon… how long do you think it takes to make some fabric, thread, fastenings and put it all together to make trousers?

Odd timing given house prices are falling.

But you have been right these past 20 years at least.

Business Rates are a terrible thing.

Then Lockdown killed the high street further.

There's a few different issues being conflated here

Demise of the High St - driven by a few things initially the rise of the supermarket. Instead of a stay at home woman (and it was nearly always women) trundling around the butcher, greengrocer, fishmonger etc it was one stop at the supermarket. The massive increase in working women in the last 50 years means that very few have several hours one weekday to do a shop like this as well. In recent times the rise of deliveries whether Amazon or Ocado has further kept people away from the High St - when you add the war on the motorist that has been going on for the last 10 years - conducted in the main by local councils but embodied by weasels like Khan and Drakeford - then it is tough for the independent storeowner.

Cost of housing - driven by three things stupidly low real interest rates increase in demand over supply and increase in people living alone. The first is straightforward - if I can afford £1,000 pounds a month to service a mortgage I can deal with a lot bigger principal amount if my rate is 2% rather than 6% (and defaults are going to increase a lot in the next year as more people come off fixed rates cut when deals were low).. On the second point the UK population has grown a lot in the last 25 years mainly fuelled by immigration (whether you think that is a good thing or not) and housebuilding has not kept up with this growth. Finally the way people live has changed - when my parents got married in the 60s both parties usually moved from the family home when this happened. People now move out when they can and there are many single person households. All of these things push up prices

Gap between the "Haves" and "Have Nots" - the premium for highly skilled jobs like finance, law, IT has increased a lot in the last 40 or 50 years. It's always been there but the difference in the amount earned by a shop assistant and a lawyer has increased. So there are probably the same number of people looking in charity shops for clothes and counting every penny at Lidl as there were 50 years ago but there are lot more taking holidays in the Caribbean and driving Mercs than there were then.

So when you take all this and add some of the issues created by things like identitarianism in whatever form then it's no surprise there is increased levels of disillusionment and social friction

Oh and if you go to a decent designer like Gant or Calvin Klein £150 quid for a pair of trousers is about standard

I think this is why people were baulking on the 15 minute city thread which discusses how 'planning' will ensure that in 15 min citys or neighbourhoods, people will be within easy distance of all sorts of amenities/shops/businesses

Posters were baulking at the idea, not because they dont want it or think it shouldnt be a thing, but because it just wont happen, shops and business will only function if people use them and they can be sustined and either because of lack of footfall, high business rates, cost of living, people living further out because they cant afford to live at the centre of town etc, these high streets cant survive.

I don’t know I stay near a little town and the high st is very much of the independent shop variety. With the exception of the local Co/op snd the butchers/ 1 of the bakeries I have never been able to afford to shop there. Lots of beautiful things bought mainly by tourists.

my fixed rate ended 3 months ago and the mortgage has gone up by 50%. I don’t really think my use of shops has changed although I have less cash than before.

I’ve observed a few times lately that we often seem to be paying handmade prices for stuff that should be a lot cheaper, rolling off industrial factory lines. The system is broken. Lack of local manufacture probably has a lot to do with it.

I live near a very affluent small town. Some normal shops. and some more expensive. It’s not a huge shopping section just one street. And the shops here are starting to go. More and more every month.

I used to shop there for presents etc. but my mortgage has gone up by £200 a month. The water and the electric have. We don’t have as much disposable income as we used to. Also I’m paranoid now about having savings just incase we get a bigger bill than we thought something would be. So I no longer go to the shops anymore if I don’t have to. If the mortgage hadn’t gone up ( and we were luckily it only went up that much ) I would have continued to have shopped there.

This has definitely happened in London suburbs over the past 20-30 years, where the high cost of living has polarised high streets to very budget in previously quite normal areas or high end in the wealthy areas. I stopped off at Honiton in Devon recently and it was just as a I remembered high streets years ago, with a wide variety of shops.

I live in a London suburb thar is now considered "prime" - even a modest Victorian terrace is over £1m and if you're below £500k its ex local authority or above a shop on a main road.

I've lived on the area for 25 years - house prices have increased 2 or 3 fold in that time. The local Budgens closed and Waitrose moved in. The High St is now exactly as you describe - nice bars, coffee shops, cafes, a high end butcher combined with mobile phone outlets, charity shops and place selling cheap clothing, shoes and general merchandise

It's very definitely two level

It’s Amazon etc imv -why would you pay an extra tenner when you can get it delivered to your door by Amazon.
I alsodont think people draw up a business plan. There are loads of coffee shops (also do light lunches) and hairdresser in my town. But seems to be revolving door of owners. But if say 6 tables with 2 people are used over lunchtime and they have soup,coffee,cake like I did at £9 that’s a taking of say £100 a day .
Yet there are 2staff and heating for 8hrs. Plus overheads. Where is the profit?
We also have 2costas doing takeaways.

I do feel sad when I see shops go, but I am old enough to have seen many shops (and massive chains like Topshop) come and go, regardless of the economic climate.

And truthfully it makes more sense to me that people spend their money on the roof over their head rather than handmade bowls and £140 trousers.

The internet is killing the high street!

Boutiques in tourist towns are actually more likely to survive

Online shopping and Working From Home might have had more to do shops closing tbf.

Plus there are only so many coffee shops and branches of H&M that anywhere needs.

@JaneDSE9

Honiton is mostly charity shops! As are most towns of that size

Can we stop with the war on motorist bullshit? Motorists were some of the earliest killers of the high street as out of town shopping centres facilitated car use.

Cycle and pedestrian friendly high streets are better for small businesses - easier to access and more money to spend if you’re not spending £70 on a tank of petrol.

Are you denying this is going on - just look on any news site.

Driving doesn't really affect people in large cities but outside it stops people driving into town to pick up stuff. Ask shopownerxs

Housing costs are also responsible for poor public services. Who can afford to pay the high taxes of the rest of Western Europe when all our money goes on housing. Cheaper housing would mean fewer people baulk at high taxes

I can tell you with absolute certainty it’s happening in the cities and at the higher end too which is unusual. I know someone who works for Selfridges in Manchester and they are significantly quieter compared to last year, the big top spending clients are still buying but the lower price points are struggling.

The loss of tax free shopping was a self inflicted blow for the UK, international luxury tourists who would spend eye watering amounts on bags and clothing are going to Europe instead, it’s impossible to compete with a 15% saving when items are in the thousands.

As for the high street, I’m surprised some stores are still going, profitability is down but there’s still people buying, stores do feel quieter and service will be affected as staff numbers get cut.

Small independent shops in tourist towns will survive if their product offer is desirable and their prices not extortionate. Lots of people are not impacted by COL but now more aware of their spending since suddenly everything is more expensive.

Small independent shops will survive if they are selling things that people want and by making their customer base as wide as possible by going online. I buy from plenty of small shops that I have never seen because they’re on Etsy or they have been recommended.