Unmoderated

LOL, The OP is asking about ways to debunk the housing shortage argument. I'm just demonstrating that a large part of this is down to the availability of cheap and easy credit. As to a shortage it's still not agreed as defined. Are there enough houses to go around? Has building kept pace with household formation? https://blogs.lse.ac.uk/politicsandpolicy/tackling-the-uk-housing-crisis/ The reports of a housing shortage are simply (no offence) the basic person's argument for house prices only going up. "They aren't making any more land" etc. There's not a shortage of houses. There might be an allocation problem which building will not necessarily solve. https://www.telegraph.co.uk/news/2022/06/30/no-housing-shortage-britain/ https://www.economicshelp.org/blog/183129/economics/is-there-really-a-housing-shortage-in-the-uk/ Look at Japan. Property prices there went crazy in the 1980s. At one point I think Japan was worth 33% of the global real estate market!! Was there a sudden population boom or a sudden loss of housing?

IIRC the refugee boat refused help repeatedly to ensure it didn't get turned around.

Not all second homes are tenanted, far from it. BTL is BTL but one in ten people own at least two properties. Air BnB, Holiday Lets etc all place more pressure on existing housing stock. Are they going to build houses if prices fall? It seems like the volume builders are already slowing down. I'm sure the perception of a shortage of housing is justified for many spanking everything onto a house and a mortgage and the housing market is a local market so there are local shortages but people are moveable, houses are not. In response to the OP I'm not sure there is a national shortage of housing (there's an allocation issue and this has been debated on other threads) and if you restricted lending to 3X one earner you'd have house prices back to affordable levels in short order. The monster increase in house prices over the last 25 years has come about from the credit markets imho. Was there a sudden drop in population in 1990 and in 2008 or a massive increase in supply? House prices fell in those times which coincided with a huge increase in the cost of borrowing (1990) and with a sudden contraction in the credit markets (2008). Then they launched help to buy in 2013 and made borrowing easy again and the rest is history.

We have millions who are over housed and millions more who own more than one house. So is it a shortage or an allocation issue? In other words, if we just build more what is to stop them being hoarded and not allocated? Perhaps social housing might work? Just thinking aloud.

It seems like you're suggesting a conspiracy. The people setting central bank rates are not doing as they please. They're running it based on models.... The market has, for the last 15 years, enjoyed central banks buying back debt. That's not quite the same as setting interest rates so you're now drifting into QE. Right now market expectations are for lower inflation and rates in the future. The fun this is that if you disagree you can bet against it. Let us know how you get on

Spot on! If transaction costs were lower and especially SDLT people would e less inclined to move twice. So many stretch to get something that will be great for them in 10 years time but not ideal for now. Ironically, around six years ago, I bought a bungalow as a project but that's now on hold given the cost of borrowing. I might have bought the house I die in!

Totally disagree. There are people who are underhoused and there are people who are over housed. I'm not saying it's fair to kick a widow out of her family home. It's also not fair to make someone raising a family in a two bedroom flat pay taxes to pay said widow's late hubby's final salary pension, winter fuel allowance and triple locked state pension plus goodness known's what else. I'm no proposing anyone lives in a tiny house am I? I proposing people live in appropriate houses. Widow could be perfectly happy in a two bed bungalow or ground floor flat. The growing family could not yet this the where we find ourselves.

My example of homeless was simply that if we have not been building enough houses for decades while the population has increased 25% then we would, in theory, have millions homeless? This is the point. How would someone define a shortage in the first place? The UK has enough houses and enough bedrooms for everyone. There are holiday lets, holiday homes, over housed etc that mean there's an allocation issue (this is discussed a length in another thread on this forum). There's also an issue of location. Housing markets are local. We might have a million empty houses in Scotland but that doesn't solve the housing issues in central London.

Here's some phrases from last time: Extend and pretend Delay and pray

The banking class (who? lol!) don't decide interest rates. The market and the MPC decide. Nobody is getting bailed out, this is not a financial crisis. The system does not require it. We have disinflation already and it's quick, look at the annual figure last month and this month. I admit, one month doesn't make a recovery and I also think inflation will not hit 2% for a while but what matters is the MPC's view on inflation 18 months ahead. If they think it will be lower in, say 3 years time than the target we can expect lower rates. The yield curve is predicting lower rates in the medium term. I don't think saying inflation has peaked and interest rates will fall equates to mortgage rates back at 1.69% anytime soon but it does mean the worst is, probably, passed.

Have we ever lived in a period when there were zero homeless? I have friends who live in vans believe it or not. One sold his beautiful house because he split with his ex. He could have kept it but decided he didn't fancy getting a full time job and enjoyed partying too much. Far more privileged upbringing than I. I'm not saying it's easy, nor that everyone has access to the house they want/need. But the question is what does a shortage of supply look like? If it's as dire as people are trying to say then homelessness wouldn't just be up a little would it?

Haha, thanks I love classic comedy. Hadn't heard of this one.

I think this might be wishful thinking for many on here. Inflation may persist above target for some time but we're already experiencing disinflation (a fall in the rate of inflation). Supermarkets announcing cutting prices and yesterday E.On emailed me to say my bills are dropping about 15%. Not nailed on. Agreed on the benefits bill. That grates on me. They've effectively taken the feckless out of being needy and pushed the young and other marginals into that position instead. If we have to have people go without I'd prefer it's people who just CBA or are feckless cretins rather than people who do work hard and/or are starting out in life.

Yep, it depends. Part of the issue is a huge demographic at the top of the age tree who are insulated entirely from all this and thing house prices going up is some reflection of how brilliant they are. I remember people saying, so and so just sold their house up the road for £X and now a doctor is moving in - it seemed like some endorsement for how nice their street was becoming rather than how crap things are getting for everyone else. I would just cut housing benefit. What are the private land lords going to do? Sell up? Brilliant. I'll buy the houses back at less than the cost to build and turn them into council homes. Give the BTLers an opportunity to give something back .

I did say it was a very simple argument. However, do we have a shortage of housing or an allocation issue? How many widows are rattling about in large empty houses while their grandchildren are with mum and dad or in a 1 bed flat? People are staying at home longer for sure. I am 40 and i didn't move out until I was 29. I guess the real genius in this question is to define what a shortage looks like? I want a 5 bed detached on half an acre with a pool and a triple garage but I am adequately housed in a 3 bedroom place. One might argue I'm over housed. I could live in a studio. Kids might want to leave home but, they're adequately housed too? Is it about want, or is it about need? Hard to really see what demand looks like. Supply is, obviously, straight forward.

It's supply and demand of cheap credit. Simple counter argument to supply of housing; If there were simply not enough houses then where are all the homeless people? The steady increase in real house prices can be linked to two things: Income Multiple Years ago Banks might lend 2.5 or 3X the man's salary and perhaps 1X the woman's. Not PC today but it was generally the view that at some point the wife would pack up work and raise the kids. Different times, can't judge. Today banks will lend on a multiple of the total combined income and that multiple is higher... up to 5X. Along with equal pay etc this alone is probably responsible for a doubling of the house price to household income ratio. It's, ironically, especially bad for women. They have kids and now have to return to the work place unless they're extremely lucky. Progress! Throw BTL into this where people with some equity could continually remortgage and leverage up to acquire more and more property on an interest only basis and you've got huge buying demand and credit leverage. The problem (for them) is that leverage works both ways.

Suggested initial purchase of £222.2K? You're putting a £46K kitchen in a £222.2k house? Anyone that thick deserves to lose their equity. Also, anyone coming of a fixed rate in 2022 and not fixing for at least 5 years is a clown. Sorry to say it but why would anyone turn down such unreal rates!?

No such thing as a stupid question... only a stupid person asking a question.

Burden of proof is an issue within law not science. We're talking scientific method here. Very much NOT legal. You can demonstrate a theory holds but you can never truly prove a theory is totally correct. Within science no proof is absolute. The principle here is 'Falsification'. I cannot prove, scientifically, that God doesn't exist. There's no evidence, in my mind, that one does either. Clearly some theories can be rejected from the armchair. If you tell me there's some chocolate orbiting Mars I would ask how you know? Theories are made from observations (mostly) but are refined when demonstrated to not hold under certain conditions. Newton's laws of motion are excellent and stood the test of time well. The problem is they are not correct..... they're accurate enough in most circumstances but they do not allow for gravitational distortion or mass increasing and time slowing as you increase speed... just one example of many. Point of interest for you the GPS satellites have to correct for both gravitational and speed distortion to ensure accuracy. Still unsure? Let me turn it around on you. Prove to me a scientific theory is correct.

These are the ones who deserve it. Teachers and nurses shunted into some help to buy where they own 35% and rant the other 65% for roughly the cost of a £350k mortgage (last year) are who I feel bad for. Totally trapped. The clown in his house for 23 years on an IO mortgage is the problem (well, all of them are). I would really love prices to come down 30%.

That's a really interesting post. Thanks! I was checking out 10yr Gilt yields over time and they're higher now than at any time since 2007. At the same time, while inflation exactions are falling according to public surveys they are still higher than in the last decade bar the last few months or so (I'm being fluffy here deliberately as don't have exacts and working from memory). People expect it to be 3.5% in 12 months (down from 3.9% one month ago) but they also expect it to be 3% in 5 years time. Who knows right? And to your earlier points most people aren't really that close what CPI is or means. Just thought it interesting. That being said there was another article out today about Tesco's stating they're starting to see food inflation easing: https://www.bbc.co.uk/news/business-65925217 Could be just to try and dodge the heat they, and other supermarkets, have attracted recently around pricing and profits or could be true. Dunno. Maybe I am being unduly optimistic around inflation and rates (I do have a large mortgage that's fixed but not forever). I'm sorry for being rather rude in my earlier posts.

I do get it. It's really what it stems from. Lying to parliament - yes also bad and where do we draw the line? Best to nip it in the bud. I'm not sad that he's gone, not in the slightest. He did lie and he was populist. I prefer dull politicians with an eye for detail like Phil Hammond and John major etc. I object to the point in bold. I do think his Brexit stance played some part in it but only in so far as making him enemies. Pretty sure it's not some campaign by Remain. It's plainly not a conspiracy, it was an excuse to get rid of someone the majority of the party thought was a clown. Same party that thought Truss would be a good idea!

I didn't raise the capitol riots as an example.... But sticking to the point I've made my views clear. It's fine not to agree. Like a say, he's a liar but this is simply a gotchya. A way of getting him out of the way.

I'm sorry you think I'm trolling, I am not. Nor am I trying to wind you up. I'm simply giving my point of view. It's different to yours. That doesn't mean it's piffle, nor that your statement is the end of the story. Actually, that's exactly what we do get to choose. Everyone is free to break the law. They just have to accept the consequences. People might hold other people to a higher standard but ultimately we're all private citizens. He is also not The Lawmaker as a singular. Laws are voted in and reviewed by the second chamber (not sure if they used 'emergency powers' for this one though). I just question the reasonableness of this. Why does it matter if he's working with these people all day and then has a drink with them afterwards? The point of those rules was to slow the spread. Not quite sure the extra hour or so was a material increase in that risk.... so that's my point. Made no difference. It's not a hospital putting vulnerable people at risk. It's not full of geriatrics at risk etc. Meanwhile, grandparents up and down the country are picking up their kids from school as part of a 'bubble'. Risk and risk.... you know?

Yep. I see the same starting to happen with Gove.