Tuesday, Feb 20, 2007
Effects of high house prices
The Independent: Steve Richards: It will take real courage to solve our housing crisis (which is why it is so rarely discussed)
Steve Richards talks about various effects of high housing costs and how it'll take balls to solve them without proposing any solutions. From the article : "The Labour MP and deputy leadership candidate, Jon Cruddas, claims that in his east London constituency and well beyond, the rise of the BNP can be linked directly to housing."
Posted by rich @ 02:59 PM (164 views) Add Comment
5 Comments
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1. nearly30 said...
A refreshing and to the point article.
Can't agree more. The housing situation is a mess - the best thing is the view on the long term problems of ignoring house construction in line with need. A short term solution would be to disuade (heavily penalise) those with 2nd 3rd 4th homes.
2. Pendulum said...
What with the volume of buy to let mortgages increasing year on year, (http://money.guardian.co.uk/property/buyingtolet/story/0,,2012835,00.html) there needs to be a mechanism to either give tax breaks to single home owners or raise the tax band of 2nd, 3rd, 4th homes incrementally. Free market policies should apply only when there in no obvious social detriment - housing is not such a commodity here.
3. enuii said...
Swap the word housing in the title for pension and you've got another crisis thats not talked about which is directly linked to HPI.
4. Northernlad said...
the government shouldn't be meddling with the housing market....which they are!
5. Chilli said...
Northernlad - there was an article yesterday or the day before (and I've seen a few more in the past on the same subject ) about homebuilders holding stock of land that has been approved for the development of houses.
It seems, the government has approved 210 000 houses last year, while only 160 000 were built. The homebuilders basically sit on the asset and let the dearth of supply increase their profits. Both on the sell side, and the value of the assets they are currently holding.
The problem is basically an abuse of the free market system. The only way this would work is if all homebuilders were to act in unison. If any were to start selling off, they would rake in the profits, while their competitors' assets would drop in value.
What this requires is government intervention.
Great article, I think this guy is right on target.