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Housing Crisis Is A Threat To London's Industry, Business Leaders Warn

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http://www.standard.co.uk/news/politics/housing-crisis-is-a-threat-to-londons-industry-business-leaders-warn-a3219171.html

Housing crisis is a threat to London's industry, business leaders warn

More than 50 business leaders today warned that London’s housing crisis is now so acute it threatens to damage the city’s “world-beating” technology and creative industries, as well as other key sectors.

Advertising chief Sir Martin Sorrell, Canary Wharf Group boss Sir George Iacobescu, architect Sir Terry Farrell and lastminute.com co-founder Baroness Lane-Fox are among signatories of a letter to the Evening Standard sounding the alarm over sky-high property prices and rents.

“The housing crisis in London is a major problem for business,” they write. “If not addressed, whole sectors, including our world-beating technology sector and creative industries, will struggle to recruit and retain staff and find themselves losing out to international competitors.

“Resolving the issue is now urgent, so that we can protect the creativity, innovation and energy which drive London’s business community.”

Other bosses to sign include John Lewis’ productivity director Andrew Murphy; Robert Elliott, chairman of law firm Linklaters; Kathryn Nichols, chief executive of management consultancy The Nichols Group; Heathrow boss John Holland-Kaye; and British Land chief executive Chris Grigg.

Baroness Lane-Fox said: “It’s vital for London to offer homes to the creative, tech and entrepreneurial talent we rely on to keep our city diverse and thriving.” Sir George Iacobescu said: “London is a magnet for talented workers but its success means the incoming mayor must fix the housing shortage.”

Molly Jackson, deputy chief executive of the Southbank Centre, said: “Without sufficient affordable housing or access to proper studio space many workers in the creative industries will be forced to move elsewhere.

“This is a huge concern as London’s cultural institutions, aside from enriching our quality of life, are vital to its economy — drawing millions of tourists each year as well as international businesses.” Mr Elliott said: “The shortage of housing is a real issue for workers in the capital and a growing problem for employers wanting to attract the best talent. If not resolved, I feel it will progressively affect London’s competitiveness.”

The letter was compiled by business group London First, which also released a report for the Fifty Thousand Homes campaign warning of “extreme housing pressure” in the city.

The report warns that over the next decade the housing crisis will increasingly hit workers in the “flat-white economy” such as creative media, advertising, market research and software development.

The study by the Centre for Economics and Business Research forecasts a range of scenarios, including one of a year when a typical worker aged 22 to 29 would have to spend at least 60 per cent of net income on rent for an inner London studio flat.

Such expenditure would force many people to flat-share. For a large group of employees, including nurses, this is already the case.

However, the study says this would extend to many young staff in scientific research and development by 2018, teaching and the property business by 2019, telecommunications by 2021 then architecture and engineering by 2023.

In 2024 young staff in computer programming and broadcasting would be affected, followed by those in advertising and market research in 2025 then publishing and information in 2027.

If the current housing market trend continues, by 2040 only young financial sector employees would be able to rent an inner London studio flat without coming under such “extreme housing pressure”. A one-bedroom inner London flat is already unaffordable to all young professionals apart from those in about half a dozen sectors including City workers, insurance and pension fund employees, doctors and management consultants.

The study also warned that by 2025 individuals in London’s “up and coming” sectors, particularly hi-tech and creative industries, face having to save for more than a decade to get together 10 per cent for a deposit on a first-time home in the capital.

The Fifty Thousand Homes campaign is urging the next mayor to pledge to build at least 50,000 homes annually in London.

It's front page, funny coming from a paper that ramps property through it's Homes and Property section and makes huge reveneus from builders advertsing their overpriced rabbit huts.

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However, the study says this would extend to many young staff in scientific research and development by 2018, teaching and the property business by 2019, telecommunications by 2021 then architecture and engineering by 2023.

In 2024 young staff in computer programming and broadcasting would be affected, followed by those in advertising and market research in 2025 then publishing and information in 2027.

...

...

Blimey they're about half a century behind the times.

It's as if they know as much about the problem as the average football director knows about football.

Edited by billybong

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http://www.standard.co.uk/news/politics/housing-crisis-is-a-threat-to-londons-industry-business-leaders-warn-a3219171.html

Housing crisis is a threat to London's industry, business leaders warn

More than 50 business leaders today warned that Londons housing crisis is now so acute it threatens to damage the citys world-beating technology and creative industries, as well as other key sectors.

Advertising chief Sir Martin Sorrell, Canary Wharf Group boss Sir George Iacobescu, architect Sir Terry Farrell and lastminute.com co-founder Baroness Lane-Fox are among signatories of a letter to the Evening Standard sounding the alarm over sky-high property prices and rents.

The housing crisis in London is a major problem for business, they write. If not addressed, whole sectors, including our world-beating technology sector and creative industries, will struggle to recruit and retain staff and find themselves losing out to international competitors.

Resolving the issue is now urgent, so that we can protect the creativity, innovation and energy which drive Londons business community.

Other bosses to sign include John Lewis productivity director Andrew Murphy; Robert Elliott, chairman of law firm Linklaters; Kathryn Nichols, chief executive of management consultancy The Nichols Group; Heathrow boss John Holland-Kaye; and British Land chief executive Chris Grigg.

Baroness Lane-Fox said: Its vital for London to offer homes to the creative, tech and entrepreneurial talent we rely on to keep our city diverse and thriving. Sir George Iacobescu said: London is a magnet for talented workers but its success means the incoming mayor must fix the housing shortage.

Molly Jackson, deputy chief executive of the Southbank Centre, said: Without sufficient affordable housing or access to proper studio space many workers in the creative industries will be forced to move elsewhere.

This is a huge concern as Londons cultural institutions, aside from enriching our quality of life, are vital to its economy drawing millions of tourists each year as well as international businesses. Mr Elliott said: The shortage of housing is a real issue for workers in the capital and a growing problem for employers wanting to attract the best talent. If not resolved, I feel it will progressively affect Londons competitiveness.

The letter was compiled by business group London First, which also released a report for the Fifty Thousand Homes campaign warning of extreme housing pressure in the city.

The report warns that over the next decade the housing crisis will increasingly hit workers in the flat-white economy such as creative media, advertising, market research and software development.

The study by the Centre for Economics and Business Research forecasts a range of scenarios, including one of a year when a typical worker aged 22 to 29 would have to spend at least 60 per cent of net income on rent for an inner London studio flat.

Such expenditure would force many people to flat-share. For a large group of employees, including nurses, this is already the case.

However, the study says this would extend to many young staff in scientific research and development by 2018, teaching and the property business by 2019, telecommunications by 2021 then architecture and engineering by 2023.

In 2024 young staff in computer programming and broadcasting would be affected, followed by those in advertising and market research in 2025 then publishing and information in 2027.

If the current housing market trend continues, by 2040 only young financial sector employees would be able to rent an inner London studio flat without coming under such extreme housing pressure. A one-bedroom inner London flat is already unaffordable to all young professionals apart from those in about half a dozen sectors including City workers, insurance and pension fund employees, doctors and management consultants.

The study also warned that by 2025 individuals in Londons up and coming sectors, particularly hi-tech and creative industries, face having to save for more than a decade to get together 10 per cent for a deposit on a first-time home in the capital.

The Fifty Thousand Homes campaign is urging the next mayor to pledge to build at least 50,000 homes annually in London.

It's front page, funny coming from a paper that ramps property through it's Homes and Property section and makes huge reveneus from builders advertsing their overpriced rabbit huts.

Look at the sort of companies raising this. Tech, legal, consulting. Hardly sectors famous for minimum wage work. If their new recruits are balking at London prices then what hope teachers, nurses and police?

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It's all part of the bigger plan, the Big Society as Dave would call it, I call it the Dysfunctional Society. But does it matter? As long as the peeps get their opiate of forever HPI what could possibly go wrong?

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I'll bite.

If you are recruiting for any skilled job in London, requiring someone to move there I.e cannot find a local, the you need to be offering 100k+

Or you need to move way out.

Simple.

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Talk about late to the table. I have no doubt many of the signatories have been revelling in their own increase in paper worth while their theoretical property values have been increasing.

Then the sudden epiphany, "oh, it comes at a cost to others?" and "oh that's not good when we depend on the others for our own wealth".

Newsflash: the property bubble can only bring loss in the grand scheme. Some may profit, but we as a collective can only loose when the cost of shelter increases. It's the broken window fallacy all over again. Houses need to be cheap for the country to prosper. You fools.

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I'll bite.

If you are recruiting for any skilled job in London, requiring someone to move there I.e cannot find a local, the you need to be offering 100k+

Or you need to move way out.

Simple.

The thing is, that's not enough.

100k p.a. + 100k deposit (generous). Total of £500k tops. What's that? It's not even a 3 bedder in Walthamstow. It's a two bedder somewhere you wouldn't want to come back to after dark.

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The thing is, that's not enough.

100k p.a. + 100k deposit (generous). Total of £500k tops. What's that? It's not even a 3 bedder in Walthamstow. It's a two bedder somewhere you wouldn't want to come back to after dark.

Thats were the '+' comes in ;-)

Its just an easy number to get people thinking.

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Weird article ... all this "will happen," in 2024 type ****. I remember coming to London and having to flat share 14 years ago to live in zone 4 on a 35k salary (a well above average salary back then). In fact - I lived in not very nice houses (or crowded houses) until I became head of risk of a multi-billion dollar hedge fund. After a year of that I could finally afford to rent a decent zone 1 house (2 beds .. no more of course) without having to go into bonus money or anything stupid like that. If I remember correctly the crossover point to having more than I needed was about 100k for a single person .. but that was quite a few years ago and I achieved escaped velocity on account of being able to see massive financial fraud even before it unwound (such an unblievably rare skill that isn't it? .. or maybe most people should be in prison).

Maybe they forget that the little people have to pay tax or maybe they just make it all up to suit their agenda and phrase it so as not to scare the horses still in the stable. I doubt there is any genuine effort to understand or explain as frankly .. that's seriously rare anyway.

Edited to make sure nobody thinks I only ever lived in zone 1 or something stupid like that.

Edited by Kinky John

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Look at the sort of companies raising this. Tech, legal, consulting. Hardly sectors famous for minimum wage work. If their new recruits are balking at London prices then what hope teachers, nurses and police?

Love the 'is going to impact teaching by 2019'. Ask any London headteacher how recruitment is going in 2016.

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Another bunch of 'free market' loving hypocrites bleating for state intervention.

The solution is simple- they will need to pay enough in the future to attract the staff they need, not demand a state handout to compensate them for the increased wage costs that have resulted from HPI.

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http://www.standard.co.uk/news/politics/housing-crisis-is-a-threat-to-londons-industry-business-leaders-warn-a3219171.html

Housing crisis is a threat to London's industry, business leaders warn

More than 50 business leaders today warned that London’s housing crisis..........................................................................................

It's front page, funny coming from a paper that ramps property through it's Homes and Property section and makes huge reveneus from builders advertsing their overpriced rabbit huts.

That's so funny it could have come from the Daily Mash. 'Shortage' of accommodation, whilst the hedge funds are shorting the developers big style. :lol::lol: I love a belly laugh at this time !!!

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What ticks me off is the way that the situation is described as a crisis of affordability with the solution always being to build more.

Whilst at the same time builders can't sell as their stock as it is unaffordable and needs HTB, shared ownership, etc to sell.

Hopefully one honest commentator will just say it as it is, housing is unaffordable and we're heading for a crash.

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^^ as you say. It is now all over the MSM. For some reason there are thee points. Houses are much too expensive. It is demand and supply. We must build more.

Are they thinking that the priced out will join the dots and think - 'Ah yes, demand and supply, more supply, prices will fall, happy days ahead' whilst hoping that property owners only actually sit up and spit out their lambrini when they hear the words 'house prices need to fall'?

Sooner or later someone must actually say the words - when that happens the emperor's clothes will finally be seen - or not. That will be the turning point.

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Well I'm leaving. My employer is finding it hard to recruit.

There's no way I'm spending the rest of my 30s in a house share getting poorer relative to house prices. That's the only future London can offer even highly skilled workers.

Why has it taken this long for business to kick up a fuss?!

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Well I'm leaving. My employer is finding it hard to recruit.

There's no way I'm spending the rest of my 30s in a house share getting poorer relative to house prices. That's the only future London can offer even highly skilled workers.

Why has it taken this long for business to kick up a fuss?!

Maybe our business "leaders" aren't anywhere near as clever as they'd like to think they are.....bit like the politicians.

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Well I'm leaving. My employer is finding it hard to recruit.

There's no way I'm spending the rest of my 30s in a house share getting poorer relative to house prices. That's the only future London can offer even highly skilled workers.

Why has it taken this long for business to kick up a fuss?!

You have kind of answered your question. Their blinded by HPI.

H P I is fiscally toxic. It's slowly takes over the host country and eventually kill the economy.

Edited by Blod

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Indeed. All that effort writing about the elephant in the room

"Dear Chancellor. Please burst the massive housing bubble ASAP"

Would have been enough.

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