Patient London FTB Posted September 9, 2016 Share Posted September 9, 2016 (edited) Today's Times has got some interesting quotes from Philip Hammond addressing the House of Lords yesterday. Here's the key paragraph: The UK housing market is "a toxic mix of increasing money supply and restrained supply of homes creating artificial asset price inflation" and causing damaging economic consequences. Part of the problem is the shortage of land availability and part the construction industry's capacity failure, he said. There was also a bit about productivity, which mentioned housing and the idea of focusing on bringing up the rest of the country to the level of productivity in London and the South East. Dealing with Britain's weak productivity will be a defining feature of the new government's economic policy and housing will be central to its strategy to lift wages and living standards, he added. Britain is around a fifth less productive than France, the US and Japan, which are "clearly very different in the way the housing market functions". The UK housing market is "a toxic mix of increasing money supply and restrained supply of homes creating artificial asset price inflation" and causing damaging economic consequences. Part of the problem is the shortage of land availability and part the construction industry's capacity failure, he said. ... Britain's productivity problem is not in the south east and London, which are as productive as the US, but the rest of the country. "If we were able to close by 50 per cent the gap between the productivity of London and the south east and the rest of England, we would increase GDP by £300 billion," he said. Edited September 9, 2016 by Patient London FTB Quote Link to comment Share on other sites More sharing options...
mattyboy1973 Posted September 9, 2016 Share Posted September 9, 2016 The UK housing market is "a toxic mix of increasing money supply and restrained supply of homes creating artificial asset price inflation" and causing damaging economic consequences. Well he got that bit right, which is encouraging coming from the Chancellor. Now what is he going to do about it? Quote Link to comment Share on other sites More sharing options...
doomed Posted September 9, 2016 Share Posted September 9, 2016 Interesting quotes. I am still undecided on this government, but it is extremely tough to be optimistic having witnessed the ******wittery of their predecessors. Quote Link to comment Share on other sites More sharing options...
sikejsudjek Posted September 9, 2016 Share Posted September 9, 2016 Maybe he could stop spending 7x per head of population on transport for London, and start to invest in the rest of the country... Quote Link to comment Share on other sites More sharing options...
long time lurking Posted September 9, 2016 Share Posted September 9, 2016 Simple LVT of some sort even if it only applies to land bought for development with a sliding scale once planing has been granted through to the completion date of the dwellings that are being built The carrot is not working time to try the stick Quote Link to comment Share on other sites More sharing options...
kzb Posted September 9, 2016 Share Posted September 9, 2016 If we could have some decent jobs up north it would help close the gap. Stop exporting them. Quote Link to comment Share on other sites More sharing options...
frederico Posted September 9, 2016 Share Posted September 9, 2016 Let's be fair, he's making the right noises, obviously though it's what actually happens that counts. Sounds like build more for less to me. Quote Link to comment Share on other sites More sharing options...
canbuywontbuy Posted September 9, 2016 Share Posted September 9, 2016 It's unbelievable that "we are where we are" (years of HPI driven by governmental policy) and a chancellor hasn't got the balls to say "we are where we are because of governmental policy" - massive vote winner being left on the table. But of course, we are where we are because of governmental policy. Nothing will change. Quote Link to comment Share on other sites More sharing options...
spyguy Posted September 9, 2016 Share Posted September 9, 2016 If we could have some decent jobs up north it would help close the gap. Stop exporting them. Stop putting public service ones in the South. Seriously, throw a stone in Lodnon and youll most likely hit someone who relies on UKGOV for most of their income. Quote Link to comment Share on other sites More sharing options...
Pindar Posted September 9, 2016 Share Posted September 9, 2016 When he talks about "productivity", he really means that housing doesn't perform so well in the provinces as it does in London-SE-land. Just think, if HSBC and CIti bank moved up North, then Yorkshire could "enjoy" the same kind of rampant HPI as those down south have been "enjoying". Quote Link to comment Share on other sites More sharing options...
Agentimmo Posted September 9, 2016 Share Posted September 9, 2016 If we could have some decent jobs up north it would help close the gap. Stop exporting them. 20 yrs ago the techies said we'd all be working from home or away from big cities due to the comms revolution. 10 yrs ago I started working from home. Pan European company. Worked across 3 continents. No problem. Today. Everyone I know that lives in London and surrounding area works 1-2 days away from their city centre offices. Absolutely no reason for government to continually pump obscene amounts of money into London. ? Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted September 9, 2016 Share Posted September 9, 2016 "Dealing with Britain's weak productivity will be a defining feature of the new government's economic policy and housing will be central to its strategy to lift wages and living standards" Uh-oh.... why can't they just leave it alone because everything they do makes things worse? 40% Help to Buy outside London? To encourage building and the living standards of the debt aspirational. Quote Link to comment Share on other sites More sharing options...
long time lurking Posted September 9, 2016 Share Posted September 9, 2016 Can someone remind me of what Cameron &co said about the housing market and the econmy when they first come to power Quote Link to comment Share on other sites More sharing options...
zugzwang Posted September 9, 2016 Share Posted September 9, 2016 More interested in Hammond's remarks about the national debt. If Big Philly isn't prepared to splash the cash then who will? Mr Hammond said he was against taking a “cavalier” approach to the debt and deficit, as he warned that the former was verging towards dangerous levels. He also reiterated comments by prime minister Theresa May that the Government would still seek to achieve a budget surplus, although not by 2020. The deficit currently stands at around 4pc of gross domestic product (GDP), while Britain’s debt share currently stands at 82.9pc of GDP. “I would suggest that the level of [public debt] as a ratio of GDP at the moment - we are getting quite close to levels that might make a difference to the willingness of markets to lend to us,” said Mr Hammond. “So I don’t think we should be cavalier about the level of the debt.” http://www.telegraph.co.uk/business/2016/09/08/chancellor-signals-boost-for-roads-and-railways-but-warns-on-unh/ Quote Link to comment Share on other sites More sharing options...
Dorkins Posted September 9, 2016 Share Posted September 9, 2016 Can someone remind me of what Cameron &co said about the housing market and the econmy when they first come to power Exactly. They all know what the problems are, but none of them are willing to fix them. Quote Link to comment Share on other sites More sharing options...
Patient London FTB Posted September 9, 2016 Author Share Posted September 9, 2016 More interested in Hammond's remarks about the national debt. If Big Philly isn't prepared to splash the cash then who will? http://www.telegraph.co.uk/business/2016/09/08/chancellor-signals-boost-for-roads-and-railways-but-warns-on-unh/ UK and international pension funds through build-to-rent schemes? Quote Link to comment Share on other sites More sharing options...
billybong Posted September 9, 2016 Share Posted September 9, 2016 (edited) Britain's productivity lack of debt problem is not in the south east and London, which are as productive in debt as the US, but the rest of the country. "If we were able to close by 50 per cent the gap between the productivity debt of London and the south east and the rest of England, we would increase GDP by £300 billion," he said. Corrected. That's if you think that lack of debt is a "problem". I don't believe true "productivity" is any different between the south east and London and the rest of the country. If anything true productivity might well be higher in the rest of the country. It's as if Cameron and Osborne still reside in Downing Street. Edited September 10, 2016 by billybong Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted September 10, 2016 Share Posted September 10, 2016 Can someone remind me of what Cameron &co said about the housing market and the econmy when they first come to power http://news.bbc.co.uk/1/hi/uk_politics/8492583.stm Quote Link to comment Share on other sites More sharing options...
Fully Detached Posted September 10, 2016 Share Posted September 10, 2016 The UK housing market is "a toxic mix of increasing money supply and restrained supply of homes creating artificial asset price inflation" and causing damaging economic consequences. “I would suggest that the level of [public debt] as a ratio of GDP at the moment - we are getting quite close to levels that might make a difference to the willingness of markets to lend to us,” said Mr Hammond. Well I'm as cynical as anyone else here with respect to politicians actually doing something about the problem, but it seems to me that he's properly put his **** on the block with those two quotes. Then again I remember George Osborne saying that QE was the last resort of desperate governments, and Gordon Brown saying no more boom and bust. And both of them seem to have got away without being held to account for it. Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted September 10, 2016 Share Posted September 10, 2016 Well I'm as cynical as anyone else here with respect to politicians actually doing something about the problem, but it seems to me that he's properly put his **** on the block with those two quotes. Then again I remember George Osborne saying that QE was the last resort of desperate governments, and Gordon Brown saying no more boom and bust. And both of them seem to have got away without being held to account for it. And therein lies the problem. Politicians lie to get elected then do what they damn well want and are never held to account. Perhaps Swiss style direct democracy would be the answer. Quote Link to comment Share on other sites More sharing options...
Fully Detached Posted September 10, 2016 Share Posted September 10, 2016 And therein lies the problem. Politicians lie to get elected then do what they damn well want and are never held to account. Perhaps Swiss style direct democracy would be the answer. Yep, I certainly don't expect house prices to fall as a result of any deliberate policy, although the various hits on BTL that are lining up might yet prove me wrong. That obviously doesn't mean I don't expect prices to fall as a result of circumstances beyond government control though. Quote Link to comment Share on other sites More sharing options...
frederico Posted September 11, 2016 Share Posted September 11, 2016 Purely anecdotal, but by observation along the M4 corridor and up towards the Midlands, there are a lot of houses being built. IMO it's all about the number of buyers than can afford a given price level. If more are built, the price level required to sell drops. Then we wait and see at what point the leveraged BTLers start to panic. Quote Link to comment Share on other sites More sharing options...
Funn3r Posted September 11, 2016 Share Posted September 11, 2016 Purely anecdotal, but by observation along the M4 corridor and up towards the Midlands, there are a lot of houses being built. IMO it's all about the number of buyers than can afford a given price level. If more are built, the price level required to sell drops. Then we wait and see at what point the leveraged BTLers start to panic. Completely agree. I'm close to the M4 and you can't move for new building going on. Although sometimes I wonder if they are serious about it - I live opposite two large apartment blocks being built and although there are lights on at night and the occasional clanging noise they don't appear to have made any actual progress in the previous two months. Wondering if they know/suspect that the market won't be there on completion so they are spinning it out for appearances sake. Quote Link to comment Share on other sites More sharing options...
long time lurking Posted September 11, 2016 Share Posted September 11, 2016 (edited) Yep, I certainly don't expect house prices to fall as a result of any deliberate policy, although the various hits on BTL that are lining up might yet prove me wrong. That obviously doesn't mean I don't expect prices to fall as a result of circumstances beyond government control though. For parts of the country it will have an effect for sure but for the majority of the country i suspect it will not (depending on what happens to immigration controls/numbers post brexit) Why.... NMW wage will be £9phr within the next 4 years that`s a joint income of close on £40k for a couple working a 40hr week @NMW ....current lending criteria will lend 4.5 joint income =£180k + the deposit (enough to bale out most BTL baring the S/E) if things get bad i expect we will also see gifted deposits at some point as this will be the only stumbling block once we have NMW @ £9.00 phr IMO there`s a small window of opportunity in the next couple of years when it comes to buying BTL bailers ...baring another event it looks like TPTB have it covered yet again Edited September 11, 2016 by long time lurking Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 11, 2016 Share Posted September 11, 2016 For parts of the country it will have an effect for sure but for the majority of the country i suspect it will not (depending on what happens to immigration controls/numbers post brexit) Why.... NMW wage will be £9phr within the next 4 years that`s a joint income of close on £40k for a couple working a 40hr week @NMW ....current lending criteria will lend 4.5 joint income =£180k + the deposit (enough to bale out most BTL baring the S/E) if things get bad i expect we will also see gifted deposits at some point as this will be the only stumbling block once we have NMW @ £9.00 phr IMO there`s a small window of opportunity in the next couple of years when it comes to buying BTL bailers ...baring another event it looks like TPB have it covered yet again Give me a break. Nmw is zero sum. It simply accommodates reduced in work benefits. Quote Link to comment Share on other sites More sharing options...
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