Will the housing crisis ever be solved?

[ByJustScroller]

Do you think there is any hope for young people wanting to buy in? I have friends and family where I live but now I am priced out. I am not just competing with locals but people who live in London and the ever increasing new arrivals. Housing supply has not kept up with demand for years and this government has no plans. I will be renting for ever.

What people can "afford" to pay often is basically all their spare income after other necessities, leaving nothing else for savings/hobbies etc and suppressing spending to fuel the economy. They have to pay inflated rents because it's the only way of finding somewhere to live, some have to go into debt to pay their rent.

So you’re suggesting people get turfed out to move on. That would create a situation where nobody puts down roots. People are entitled to make homes. It would be like temporary accommodation that nobody gave a shit about. You may have been allocated a HA property when you needed it. You’re saying that if that person retrained or their circumstances changed they should be forced into the private rental market so someone can take over the home they’ve built? That isn’t the answer. The answer is more homes with affordable rents.

It’s very easy to say we should
be less emotional about housing when it’s not your home you’re talking about, isn’t it.

There is very few housing options an independent older person would want to move to after living their whole life in a house. Round here it’s all supported living or flats, neither of which would appeal to me. There’s very few bungalows and no-more are being built. Would you move in to housing you didn’t like? I bloody well wouldn’t.

Just because you don't ‘own’ the structure doesn’t mean it’s not your ‘home’

I think you’ve quoted the wrong person :)

I have. Sozza x

Did you not read the post i put up at 17.30

Middle class Mners only care about families in temp accomodation when they can use them as a stick to beat SH tenants with. The rest of the time its "why did you have kids when you cant afford them.
Same tactic was used during Covid "we must obey restrictions to protect the ill and disabled" Now people want disability benefits to be cut.

Reform do it too. "we need to protect our own" then denigrating those on a low income A lot of MNers have got more in common with Reform than they would like to believe

There is zero political will to sort this out from any party as it’s part of the “rich get richer” wealth divide that is continuing at pace. Progressively the middle classes will be locked out of property ownership and will need to rent from the super wealthy. The middle classes will disappear completely before long and merge with the working class.

Yep, this!

Selective compassion works both ways and certainly isn't restricted by social class. You have completely missed the irony in your post.

We are at the start of a house price adjustment thankfully. Its unlikely to be as big as we need though. Realistically homes need to fall by about 50% to bring in the priced out generation fully. In my opinion we won't get that - but might get a fall of 20 to 30% ? Its finger in the air stuff trying to predict how big or small this adjustment will be. Its also difficult to predict how long it will go on for and how quickly it will happen. It could bottom out in 2 years or 10. No way to know.
High house prices are really bad for the economy and social cohesion, and it only really benefits lenders and outright owners. Unfortunately its also an entire industry that those with financial leverage will do their best to hold on to and manipulate.

Agreed. My daughter is with a housing association. Her tenancy will be reviewed every 5 years.

The answer is charging them market rate rent at that point, and using the money to build more government owned homes. It shouldn’t be a £1000-2000 quid a month permanent, inexplicable handout to people that have a decent income as it often turns out to be - especially in London with the vastly easier access to jobs and vastly higher market rate rent.

Building more and more houses definitely isn't the answer. Every field in my town has been destroyed for housing-8,000 homes built in the last 6 years. The number of people priced out of homes is even higher than it was then. It's an affordability issue we have, not availability.
My DSIS could choose from 500 empty houses within a 5 mile radius, but she can't afford any of them. I don't know what can be done about it really, because current homeowners aren't going to want to see house prices crash. It's a difficult situation and I don't know the answer, but the current trend of building thousands of sub-standard homes definitely isn't it.

No I don't think it will.

As DrySherry points out high house prices are bad for the economy and social cohesion. But bankers have sold enough people on the idea paying them huge amounts of money to own piles of bricks is a good idea, and no major party appears to compete on the idea of lowering house prices. They may talk a good game, but they won't actually do anything about it.

It turns out that people today are no different that people from long ago in wanting to preserve their own wealth at the expense of other peoples lives. Who would have thought it.

There is of course a balancing act between the new peasantry and the lords. However, our housing crisis has never quite reached the revolutionary tipping point and probably had some way to go before it did (at its peak).

The worst thing about the government is the market interference. If they just left the market alone it would probably find a more reasonable level. But constant meddling and interference (mostly to boost prices and to try to make the unaffordable affordable) messes with the prices and prevents them reaching equilibirum. Things like shared ownership, forcing the banks to lend people more money, help to buy etc.

If the government would just leave the market alone that would be a start.

The good news though is that the government has little money to try to boost prices (aka lend to people who can't afford to buy) and interest rates are running higher. That is going to lead to long term decline in prices I believe.

I think the market really needs a crash to move it forwards, but I suspect what we will get is a long term standoff between sellers who can't (or won't) afford to sell to buyers who can't afford to buy, with low volumes and a decline in greater economic activity as a result. The government can either choose to perpetuate this standoff or make the market clear by using policy. No prizes for guessing which one they will choose.

Things will shift once housebuilding and robotics merge, the cost and speed of building homes will change dramatically, that’s coming (latest) in the next 3 years. The pace of science developing new materials for house building will also significantly reduce the cost of homes, all that will be needed is the land.

No it won't be solved. The population is increasing. Folk still want to live in desireable places. And people splitting up so they need a house each.

I don't see robotics being much use for most retrofit to UK housing stock.

My parents are poor, in their late 80s/90 and frail. If someone tried to move them from their small 3 bed housing association place (on which they've paid rent for 50 years) I'd hunt them down and do something irresponsible. It's their home.

Who exactly are the peasantry and who are the lords?

Why does the housing market have to be characterised as a battle between the greedy and the needy? There are a whole host of people in between. An elderly person on a modest pension living in a house that has increased in value isn't a feudal lord. Nor is a family with a large mortgage. And someone renting isn't necessarily a peasant. Caroline Quentin has sold her house and is renting, is she now a pauper?

For most people a home is more than "a pile of bricks" or a way of creating wealth. It's stability and security. Homeowners didn't magic up house price inflation or fail to build the right homes in the right places. Successive governments, deregulation and decades of policy failure did that.

It turns out that people today are no different that people from long ago in wanting to preserve their own wealth at the expense of other peoples lives. Who would have thought it.

So what exactly are homeowners supposed to do? Move somewhere less suitable so somebody else can have a more suitable house? All we have done then is change who is having the problem. Should elderly people move away from support networks, shops and doctors just as they stop driving, because a family would make "better" use of their home? Should a hardworking single parent with one child move out of a three-bed because they are occupying it at the expense of a family with two children? Where do we draw the line? Workers with spare bedrooms, living somewhere convenient for their work, being turfed out so a larger unemployed family can move in?

Isn't the solution actually more of the right homes, in the right locations, at prices people can afford? Let's ignore the overpriced, poorly built, executive level new builds on former greenfield sites, where developers then use viability arguments to significantly scale back the number of social or genuinely affordable homes. Lets ignore the profits, which often have had the benefits of government backed loans, streaming out of the country, rather than being capture by local authorities and the government. Sure we get many benefits from the build phase but what about the long term rental income? or sales profit? I'm pretty sure addressing that would do far more for everyone's quality of life than vilifying homeowners or arguing over who should give up what they already have. Trickle down doesn't work, but helping to raise people up has to be better than just dragging everyone else down.

There is also very little discussion about how much our idea of having "enough" has changed. Brands, leased cars, fast fashion, holidays, constant upgrades, cosmetic and surgical augmentation (make up is no longer enough), influencers... things that are luxuries have become normalised. There is peer reviewed research showing that people can feel more deprived simply by comparing themselves with others, even when materially their circumstances have improved greatly.

Poverty is absolutely real and housing is absolutely too expensive. But trying to neatly dividing everyone into greedy homeowners and a "new peasantry" is disingenuous. Life is much more diverse and complicated than that.

You assume those savings will actually be passed on to the buyer. Lower production costs don't automatically mean lower selling prices, particularly when the market will bear more. SaaS pricing models are a pretty good example of this. Not physical product but the price keeps going up.

If robotics halves the cost of building a house but buyers are still prepared, or forced through lack of supply, to pay £400k for it, why would the developer suddenly sell it for £250k? Because sadly, the response to unaffordable housing has too often been to find ways of making the unaffordable manageable (have you seen the length of mortgage terms these days...), rather than actually making housing affordable.

It's probably one of the areas where clever, targeted government intervention could actually make a huge different to affordability. Making sure the benefits of cheaper and faster construction actually translate into more affordable homes, rather than simply bigger margins. Mariana Mazzucato talks a lot about this - value creation for both the government and the homeowner. There is no reason why it should all go to the developer.

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Of course not all builders will pass on the savings, but the scale of success for the developers who do do this will be off the charts. Brand new, modern, high tech attractive homes built with machine like precision that are more than affordable would create a boom in house building like never before.

Short term, we can improve the housing supply with a social housing programme and rebalancing the economy so more high quality jobs are created in the Midlands and Northern cities. We also need basic population planning - badbadbunny's post about the demand for bungalows shows that there is a hunger for the right kind of housing and we are going to have double the number of over-60s in the next few decades. Get it right and we can free up housing stock, keep people healthier and happier for longer and reduce demand on the NHS.

Long term, our population will go down if we keep immigration low, as the birthrate is below replacement rate. If and how we want to do that is a political choice.

"Successive governments, deregulation and decades of policy failure did that."

I think I mentioned that.

"So what exactly are homeowners supposed to do?"

Cutting down on the NIMBYism would be a start. Stop buying up second homes in resorts and pricing locals out of the market. Stopping complaining bitterly when highly regressive and ill thought out taxes connected with property that boost prices like council taxes are slated for reform. Ending BTL. Hold parties that don't fulfill their promises on the housing market to account. It wouldn't provide a complete solution, but might go some way towards it.

"Isn't the solution actually more of the right homes, in the right locations, at prices people can afford?"

Of course. Why do you think the government isn't doing that and what do you think happens if it does ?

"or arguing over who should give up what they already have."

I don't think people should give up their houses. I do think that the wealth of the cohort that owns houses should not be continually prioritised over those that don't. If the market was allowed to find its own level without government intervention and property taxes were well thought out and progressive I'd be happy enough with that.

I think the tech to build kit houses has been around a long time.

For whatever reason it hasn't caught on though, and I'm not convinced that it will in the future.

There is still (for whatever reason) a lot of prejudice against "non standard build" houses in the UK. Maybe a start would be for the government to act on that.