Tuesday, Aug 17, 2010
Why it is important to abolish right-to-buy
Guardian: Can David Cameron match Harold Macmillan's achievement in house-building?
Right-to-buy and buy-to-let have created an urgent need for social housing – which the Labour government did not deliver
This is the most selfish generation of homeowners in British history. Until we confront our own selfishness, there will continue to be huge housing shortages, especially for young and less-affluent citizens.
Posted by khards @ 08:52 AM (1582 views) Add Comment
30 Comments
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1. debtfree said...
It's so obvious that the government has created this mess, it's not by accident either.
Affordable housing ? Ha, what a joke.
It's for the rich or for those to make others rich.
2. mark said...
debtfree you mean the previous labour government consisting of the B&B boys
3. khards said...
This article hilights how problems have been brewing up over the last 20 to 30 years over successive governments.
We seem to be slowly moving in the right direction, however I still think that we will see people on the streets before we see real action from the gorvernment.
Once right to buy is abolished councils will have greater incentive to build social housing, this will exert downward pressure on BTL. This will reduce prices down the bottom end (BTL) and cascade through to the top end of the market.
4. mark said...
there is a council which has withdrawn right to buy cant remember which one, saw something on news the other week
5. debtfree said...
mark, here's just one example of housing manipulation
As chancellor, Gordon Brown prevented councils from using their receipts from right-to-buy to build new homes and Labour's failure to challenge this Thatcherite legacy has landed us in the crisis we have now.
6. Pwez said...
Why not ban home ownership and make social house the only option? After all, building apartments is cheap, far cheaper than the land and building costs if done in the right scale. The reason for this site's existence would disappear, BTL, HPI all banished. HPC would be one happy communist utopia.
Living in a ex-communist country, in a free apartment given by the state, I can see the advantages.
7. Crunchy said...
One for the fans of the Thatcher era. Boooo said Sid.
Yes, the selling of 'council' houses that were funded by the taxpayer (sound familiar) should be brought back to it's original intent.
This is so much more relevant today than ever. Housing assiociations should get first call on these pending repos.
The attemp to buy votes should be abolished. Brown in his last throws of puppet power supports that plea clearly.
We have never had it so bad.
8. mark said...
I cant see a crisis due to shortage or over population as there are over 1 million empty houses in the UK..
I feel it is simply greed for higher and higher prices, after all the estate agent selling your house is getting commission based on selling price, of course they will help people over inflate values causing house issues.
the real issue is prices are simply to high for people to afford.
9. uncle tom said...
The important detail is that the difference between what is being built, and what needs to be built; is really quite small, and doesn't require huge amounts of virgin land.
A general presumption in favour of residential development, where land has previously been developed, would be a good start; and as I have said before, the MoD is sitting on an awful lot of trashed land it doesn't really need any more.
There also needs to be a more pragmatic approach to the development of flood plain. There is a huge amount of land being ruled out for development, because there is a once in twenty year chance of the land being flooded. OK, these are flat bits of land that once in a generation get a thin covering of water.
Ground floor slabs can be set a foot or two above ground level, and having to drive your car to higher ground once in twenty years is not a big deal. The garden will be left a bit muddy, but again, once in twenty years isn't going to bother people much, especially if it means they can get a bigger house for a lower price.
As for Mr MacShane's case for more council housing and the right to buy issue; yes, we need more social housing; and the right to buy problem can be easily solved by only giving new tenants the right to buy at full value. But, past politicians building houses for other people to live in, has given us a legacy of sink estates. Better, in principal, to encourage and help people to build their own homes.
10. Crunchy said...
"I hate uneducated people having power; but I like to think that the poor will be rendered happy."
Harold Macmillan, before the international banking networks took over, when we still had some people of integrity and honour.
RIP David Kelly.
11. nickb said...
UT
If its a question of a physical shortage, to be remedied by building more, then why on earth are housing prices so cyclical? this can be simply seen on the chart of the homepage of this website. Population is not cyclical like that, nor, I'll bet you, is the net housing stock (supply will increase in a boom). Nor are there (all that many) unhoused people. It's an asset price bubble, pure and simple. Then add in the fact that loads of building space is kept empty effectively for speculation. So there's no need to build yet more houses, just for prices to come down, eating further into agricultural land and nature and wasting loads of energy into the bargain.
Nick
12. John East said...
Khards, I don't think emotive terms such as, "The most selfish generation of homeowners in British history" is relevent to this argument. If big government kept it's sticky fingers, and it's social engineering meddling, out of the markets, then we would never have had a bubble in the first place.
The "selfish generation" your refer too were merely acting in their own, rational, self interest, just like every human being would have done since the beginning of time, including, I suspect, yourself.
Rather than stoking intergenerational envy, a precursor to more socialist confiscation of hard earned assetts, we should unite as a society against the fools and thieves (politicians, financiers, and their pet economists) who got us to where we are today.
13. Crunchy said...
7. uncle tom said...'Better, in principal, to encourage and help people to build their own homes.'
Bravo!
Oh, the empowerment. I almost forgot it still existed. Parliament and the people pulling together? That's novel.
14. mark wadsworth said...
That is the first time that I have agreed with every single word and sentence of an article or letter written by Dannis McShane.
15. uncle tom said...
Nickb,
I could write a lengthy essay on all the factors that have affected the housing market over the years, but the bottom line is that supply has fallen very slightly short of demand since WWII, and this has provoked a series of price oscillations, each one more extreme than the one before.
This pattern of oscillations cannot continue forever. If the last peak twenty years ago had been followed my a more intensive construction program, we might now be seeing the pattern of oscillation diminish and fizzle out. As it is however, the current peak is too high for an orderly retreat.
The best analogy is to consider the behaviour of a whip. If you work it very gently, you get a series of oscillations that first grow and then fade away, without a resultant crack at the end. Work it more energetically and the oscillations grow violently until the whip cracks.
I believe the housing market has just experianced its last oscillation, and that we are now at the crack of the whip, and the big bust in the market..
16. timmy t said...
As Mark says - there are enough empty houses in this country - supply isn't the problem. LVT would sort all this out.
17. uncle tom said...
timmy t,
Yes, more empty properties could be brought into use, and the best way to do that is to charge them double council tax.
That alone is not enough though - you will never have 100% utilisation.
- We need to build more.
18. nickb said...
UT,
I agree that there is likely to be a big bust, but this just reinforces the point that it's a mistkake to expand the stock!! you don't need a supply shortage to get house price inflation, all you need is a glut of cheap credit.
Nick
19. timmy t said...
UT - if we build much more, prices will plummet not through the increase in supply but through the collapse in demand - nobody would want to live here anymore!!
20. Crunchy said...
14. timmy t,
Those nobody's would have no choice but to stay and wonder where all the Japanese interest came from.
We should be talking about housing our population but valuation is a stubborn mental block that has to be curtailed.
21. uncle tom said...
timmy t,
You're buying into the myth that more housebuilding will have a major impact on the landscape..
..only about 5% of the UK is currently developed for housing, and to have an adequate supply of homes, we only need to build one extra house for every twenty that is already built; which equates to developing just one acre in 400 of the land that is available.
- It's no big deal..
22. mark wadsworth said...
Uncle Tom, when you write that essay, don't forget to include a chapter on the impact of taxation and subsidies on house prices (scrapping Schedule A tax, replacing Domestic Rates with Council Tax via Poll Tax, phasing out MIRAS), as well as changes in tenants' rights 1988!
23. timmy t said...
UT - it was said toungue in cheek! I've already made my decision to leave though - this country is ruined.
24. nickb said...
UT
"only about 5% of the UK is developed for housing"
That kind of figure is notoriously misleading. how much of the UK is uninhabitable? How much ought to be ringfenced for farmland, in view of the current and future pressure on food security? how much infrastructure goes in when new housing is built? etc. etc.
As I said before to Mark W, a tiny % of UK land is taken up by roads. but that doesn't imply it is negligible in its effects. If I covered a 'negligible %' of someone's garden in razor wire, I would render it unusable.
If it's an asset price bubble, let it crash - there is no reason to add to the appalling Wimpy Home epidemic going on.
N
25. clockslinger said...
It is just embarrassing to watch The Guardian, a supposedly left wing paper that never seriously questioned the rightward drift of Nu Labour, get all beggy with the Etonians to do the poor a favour. Christ help us because these people, self appointed vanguard of social democracy, are clearly incapable of finding their own a55holes even using both hands.
26. it_is_going_with_a_bang said...
Well let's be honest the whole housing market is built up around of the word "selfish".
Can you really see the majority of home owners wanting any policy pursued that actually has the direct effect of easing a housing shortage with the direct knock on effect of bringing the price of housing down nationally.
Until people start seeing a home as something they need to pay for as opposed something that pays for their lifestyle nothing will change.
Personally I would like to see a huge building program of council house/housing association stock and put a stop to buying "council houses" at least for the time being.
There is also mile upon mile of area to build on - lets not kid ourselves here - it's not exactly Japan is it.
27. mark wadsworth said...
@ Nick B, Uncle Tom's figure of 5% is entirely accurate and not misleading in the slightest. Don't argue with him on maths because he's usually right.
If I covered a 'negligible %' of someone's garden in razor wire, I would render it unusable.
That's why we have laws against that sort of thing - and why would you want to do it, in any case? That's possibly one of the worst analogies I have ever seen. It's even less convincing than the NIMBY mantra that without very strict planning restrictions "They'll concrete over the South East".
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