How do you see property panning out under a Labour government?

[KievLoverTwo]

I wasn't focused on politics or house buying or green initiatives when they were last in power.

What does seem clear is the party has to be more right leaning to appease the Tory voter base and overseas investors, I guess because we have precisely diddly squat economic growth and barely a pot to piss in. I don't know what growth was like under Labour, but it's somewhat irrelevant, because we have to think about what they might inherit.

Educate me with your memories of the past, and any thoughts you have on how things might have go in the future.

I'll start off with an example thought: HMRC are cracking down on holiday lets, insisting air b and b and their counterparts produce six years of income data to chase tax evaders. I think this is the sort of thing Labour are likely to go after with a vengeance - at least if they are to appease their more left leaning supporters. But perhaps they also won't want to upset the apple cart too much and alienate the probably majority of second home owners who usually vote Conservative.

It used to be so much more clear cut. Now they all sort of merge into one.

An interesting question. I just read an article on “How will the General Election affect house prices?” which I will provide a link to later.

It said that real house price growth in the last five decades has risen the most under Labour governments, while 4 out of the 5 governments that presided over falling house prices were Conservative.

Tony Blair oversaw the period of greatest growth in the housing market with prices increasing by 9% per year on average during his premiership. Under John Majors Conservative government which started during a global recession in 1990, house prices increased by just £3 a day.

I think the housing market is cyclical with the rises and falls and rises and falls so I do think house prices will start picking up again during the next 5 years. Though I’m not sure if that will really be down to Labour policies, assuming they win the next GE.

Curious to know if it's cyclical with changes in government and what they inherited.

Yes, do please link the article.

Blair oversaw an economic boom era as far as I recall. I want to look at the economic data behind your article's claims.

When you say right leaning towards the Tory voter it means leaving everything as it is. More affluent conservative house owning voter is not interested in huge house building initiatives, big building sites on their back yard. Which will suppress house prices and dampen the rental income.

I think the labour sees a big economic gain in house building, it has a multiplying effect of 3. So every pound which goes in to the building site will generate £3 of growth. But to succeed the whole planning process needs to be reformed.

You’re right to look at context today rather than a global boom which resulted in a huge crash

A lot of risk involved in those rising Blair prices which plummeted in 2008

House prices isn’t really down to the government, very naive to think any government policy can influence. Other than very short term things like stamp duty relief. The Bank of England manages it, irrespective of government. And many things impact, inc global events. They manage it to keep the prices stable.

Government could influence house prices but it's a slow long game

More council homes - well maintained and with real sensible rents

The easier it is for people to get those kinds of homes the more heat it will take out of the housing market

Not seen any politician actually talking about building council homes though - it's all private enterprise

I concur. It also needs the support of house builders. From my limited experience of reading up on housing developers: they don't build during an economic downturn.

So Labour can spout house building goals til the cows come home, but even the Tories didn't meet anywhere near targets for the last 13 years. There are two arguments:

Most Tory voters don't want their house price lowered by having enough housing

Housing developers contribute something like 1/4 to 1/3rd of their party's contributions

Happy to be proved wrong. Happy to see if those ratios were the same under Labour.

Bun fights are okay on this thread because politics, but I would prefer facts and data when it comes to historical discussions.

Most Tory voters don't want their house price lowered by having enough housing

neigher do most labour , Lib Dem or any other demographic of voter.

"What does seem clear is the party has to be more right leaning to appease the Tory voter base and overseas investors"

Ffs. Every time the LP lose an election they scurry to the right, instead of articulating an alternative.

It won't work. You should change your name.

I will do soon. Don’t recall much data in the article tbh & Blair was lucky with his timing.

But I doubt either the Conservatives or Labour will really invest in large amounts of affordable housing whatever they say. It’s a promise made & broken before.

Perhaps I am a Marxist or communist? Idk. I would happily see house prices lowered (if I actually owned a house, which I do not) if it lead to a less divided society, and the next generation not having to financially cripple themselves to own a home.

For context, I have no kids. That makes a difference. Inheritance is so important to so many parents.

I just don't think the current house price situation is fair on the least fortune in our society, and whilst I perfectly understand the desires of BOMAD, it's just making house more expensive for everyone, including their kids. At least in the last year or two, it leads to an horrific debt trap, the likes of which would have caused our ancestors to keel over and die in shock (40s-70s).

It seems to me (again, from my very limited knowledge) that house price growth only really became important when final salary pensions were taken away, and anyone who has to exist on a government pension is basically on the poverty line.

That leads back to capitalism. People used to have a job for life. I started work in 1991 and that seemed to be the prevailing attitude then. Fast forward to when I was last capable of working, 2013, and that was all but erased.

The house price increases in the early 2000s were pretty much a thing in all western economies and not really linked to the Blair government specifically. It was 'created' by deregulation and financial markets loose lending, which most governments were happy to turn a blind eye to.

House prices in the UK then fell around 15% over 15 months to spring 2009, as a result of the GFC, again not really anything to do with government.

The increases over the last few years were mainly as a result of recod low interest rates, set by central banks accross the west, and again not primarily to do with government. Though things like temp reductions in stamp duty and Covid-19 grants and loans contributed.

Labour will inherit a flat economy with high (normal) interest rates and house prices that will probably flatline at best (which is actually a significant real term fall) for a while longer. They are unlikley to try and influence house prices directly and are probably not able to do much even if they wanted to.

IMO, what they will be likely to do that will impact housing, but not necessarily prices directly, will be around things like easing planning permission, possible new towns, providing financial support for green house improvement, and initiatives for social/council house expansion. They have pretty much publicly stated these things already. I agree with the OP that they will also continue the clamp down on private rental market. I would also expect them to start/revive some first time buyer schemes, particularly as the Tories are already briefing the papers today that they plan to do this themselves.

House prices within the time of Blair were a bubble fuelled by excess risk and sub prime market, those things are the context and tied to that period.

Not many thought houses would crash as they did, there’s a great book on those who made loads of money from predicting it at the right time.

For everyone else the crash from that exposure was what came next

I am afraid I don't understand much of your post, but you are right in one respect. I have really gone off chicken Kievs, and in terms of breaded goods, should probably call myself Schnitzel Lover.

Well they presided over a massive house price 'boom' and super low interest rates last time.

Lol.

Here is the link

https://www.black-brick.com/insights/in-the-press/how-will-the-general-election-affect-house-prices/#:~:text=Do%20elections%20move%20housing%20markets,number%20of%20transactions%20(sales).

At risk of sounding like a hardcore labour voter, which I am really not - I am quite ambivalent atm. If that was the case, wasn't that off the back of the hardcore capitalism of the 80s and a spend, spend, spend decade?

If one government encourages high wealth and spending, how does the next reign it in and say 'don't be silly, things won't always be this way' whilst also gaining a decent voter base?

They were all fucking idiots to think it was infinite.

If the last year has taught me anything, it's that 98% of Economists should be paying their employers for the privilege of the bullshit they spout.

It doesn’t matter which side you’re on, no one and I mean no one, wants their house devalued. If you owned a house you would not want it to be worth less than when you bought it.

I expect both decades are relevant although haven’t read up on deregulation changes.

Imo we were gambling with a very large chip during that period because our FS is so strong comparatively

And when we lost we got hit hard

At any point a gov could have said hang on we’re exposed here but the benefits politically were too high, until the crash that is

I think some rules have changed since

As for telling people the bad news I think Labour are skirting round the lack of funds atm and sometimes refer to the 90s / 2000s as a sell but then pull back as they know expectations will be too high. It’s a good way to get votes though so not too much realism

I don't think that's true. I have seen at least two people on this forum in the last two weeks say they would be happy for house prices fall if it helps their kids.

The problem BOMADs have is not only the vast amounts they have to give their kids to get on the ladder, but also planning care costs.

Get a time machine and tell some parents their care costs will be 1.5-4k a bloody week, and then watch their faces.

Anyway, sorry, I respectfully disagree.

Definitely skirting and hoping folks have rose tinted spectacles.

It's probably fundamentally pretty bad for society that a government takes power for only 4-5 years. Where does that come from? Half their terms are just peacocking, making false promises, press releases about shitty economic legacies for some that they have no intent of implementing, they just want to burn down the house for the next guy.

It's too short. Give them ten or twenty years to take actually responsibility and grow and change policies, and if they fail, find a way to get them out.