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Nick_wacker

We're not building enough houses

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how on earth anybody can say we are not building enough houses now is beyond me. In the areas that I frequent they are building masses. Weston Super Mare is have an entire town bolted on to it , out where the old Westlands site was by the helicopter museum. Keynsham is getting it from both ends, big development out on the south side and another where the old cadburys factory was, (somerdale I think its called). And then Tetbury is almost getting doubled in size.

People I speak to say the same thing, there is building going on everywhere, surely this is going to have an effect on prices at some point similar to what Ireland experienced.

And don't call me Shirley.

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The population is rising by 5 million over 10 years or +500,000 per year

source: https://tradingeconomics.com/united-kingdom/population

House building is hovering at around 180,000 per year if we assume 2.3 people live in each new house thats enough for 414,000 people.

Thats a shortfall of 86,000 per year or somewhere approaching a million people over the next 10 years.

The UK has a stark choice either we build, and keep building a LOT of houses, or else we start getting rid of some of the people. It will take deporting some 1600 people per week, just to keep the numbers stable.

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3 hours ago, Habeas Domus said:

The population is rising by 5 million over 10 years or +500,000 per year

source: https://tradingeconomics.com/united-kingdom/population

House building is hovering at around 180,000 per year if we assume 2.3 people live in each new house thats enough for 414,000 people.

Thats a shortfall of 86,000 per year or somewhere approaching a million people over the next 10 years.

The UK has a stark choice either we build, and keep building a LOT of houses, or else we start getting rid of some of the people. It will take deporting some 1600 people per week, just to keep the numbers stable.

I go for deporting.. 

we could not feed ourselves during WW2.. with 10% food imports..

now we import 65% of our food we are completely stuffed.. we are food vulnerable.. 

this hot summer has seariously effected food production, with global warming we melted 3.3 trillion tons of ice into the sea over 25 years.. 

this is accelerating so maybe 4 to 5 trillion tons more ice in the next 25 years our island will get smaller and population bigger.. 

very dangerous.. especially as we have killed 75% of our pollinating insects.. 

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12 hours ago, Habeas Domus said:

The population is rising by 5 million over 10 years or +500,000 per year

source: https://tradingeconomics.com/united-kingdom/population

House building is hovering at around 180,000 per year if we assume 2.3 people live in each new house thats enough for 414,000 people.

Thats a shortfall of 86,000 per year or somewhere approaching a million people over the next 10 years.

The UK has a stark choice either we build, and keep building a LOT of houses, or else we start getting rid of some of the people. It will take deporting some 1600 people per week, just to keep the numbers stable.

The number of people per house in 2000 - 2.39, in 2016 - 2.37

The calculation you’ve done is a bit odd, but if you do it with the right numbers - 480,000 people, 210,000 new homes, 2.4 people per house, you find a surplus of about 10,000 homes.

It is true that for about five years after 2008, we didn’t build enough but we built so many before then that it hasn’t really made a lot of difference. 

So it’s more accurate to say that we have built enough homes, historically, but not a surplus.

As for the current building levels, the 2016-2017 building figures show that net supply increased by 210,000 new houses (excluding house -> flat splits), whilst population growth fell.

So right now (2016-2017) we’re building many more than we need - something like a new home for every 1.8 new people - which is a good thing, but not surprising given the huge subsidies to building companies. 

Interestingly, as well as an increase in new housing completions it looks like there has been a very significant increase in change of use conversions (i.e. barn or shop conversions).

Edited by BorrowToLeech

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41 minutes ago, BorrowToLeech said:

Interestingly, as well as an increase in new housing completions it looks like there has been a very significant increase in change of use conversions (i.e. barn or shop conversions).

I would add conversions of redundant office blocks into apartments to those other conversions.  I have seen this in Southend (low employment opportunities) and Reading (high employment opportunities).  They are both about 40 miles from central London and are in the so celled prosperous South East.  There are lots of new builds coming on-stream so that should help to crash the market when the populous realises the economy has tanked.

Edited by dougless

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14 hours ago, Nick_wacker said:

how on earth anybody can say we are not building enough houses now is beyond me. In the areas that I frequent they are building masses. Weston Super Mare is have an entire town bolted on to it , out where the old Westlands site was by the helicopter museum. Keynsham is getting it from both ends, big development out on the south side and another where the old cadburys factory was, (somerdale I think its called). And then Tetbury is almost getting doubled in size.

This what I am seeing too, new builds with box rooms everywhere, signs for new developments also. In my town two spanking new large office builds have the signs “to let” on them, no takers. They were completed over a year ago.

I did think about the Ireland effect too, I think we may well be heading in that direction.

Edited by mathschoc

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Bear in mind that some of the very high numbers in the past are to make up for that flat period that resulted in losing quite a few houses. There were also post-war period of flattening some existing housing and replacing it.

But really all those numbers are shockingly high and demonstrate the desperate need to get population growth under control. How many places have changed beyond all recognition in merely one lifetime?

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44 minutes ago, BorrowToLeech said:

The number of people per house in 2000 - 2.39, in 2016 - 2.37

The calculation you’ve done is a bit odd, but if you do it with the right numbers - 480,000 people, 210,000 new homes, 2.4 people per house, you find a surplus of about 10,000 homes.

It is true that for about five years after 2008, we didn’t build enough but we built so many before then that it hasn’t really made a lot of difference. 

So it’s more accurate to say that we have built enough homes, historically, but not a surplus.

As for the current building levels, the 2016-2017 building figures show that net supply increased by 210,000 new houses (excluding house -> flat splits), whilst population growth fell.

So right now (2016-2017) we’re building many more than we need - something like a new home for every 1.8 new people - which is a good thing, but not surprising given the huge subsidies to building companies. 

Interestingly, as well as an increase in new housing completions it looks like there has been a very significant increase in change of use conversions (i.e. barn or shop conversions).

I would certainly say in some areas there is an oversupply of new homes. When you have villages which then get a number of developers building a few hundred homes over a couple of years it completely, then the next village over gets the same, no wonder there is an oversupply to the local area. There are only so many people that want to live in rural situations with barely a local shop there.

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9 hours ago, macca13 said:

I go for deporting.. 

we could not feed ourselves during WW2.. with 10% food imports..

now we import 65% of our food we are completely stuffed.. we are food vulnerable.. 

this hot summer has seariously effected food production, with global warming we melted 3.3 trillion tons of ice into the sea over 25 years.. 

this is accelerating so maybe 4 to 5 trillion tons more ice in the next 25 years our island will get smaller and population bigger.. 

very dangerous.. especially as we have killed 75% of our pollinating insects.. 

I agree, it should be government policy to be able to produce  80% of our own food with a crisis plan that we can produce 100% in a very short period, we will get caught out one day. where do we get the money to do this, stop throwing £trillions into the property market and start using that money elsewhere, farmers to start with for example

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1 hour ago, BorrowToLeech said:

The number of people per house in 2000 - 2.39, in 2016 - 2.37

The calculation you’ve done is a bit odd, but if you do it with the right numbers - 480,000 people, 210,000 new homes, 2.4 people per house, you find a surplus of about 10,000 homes.

It is true that for about five years after 2008, we didn’t build enough but we built so many before then that it hasn’t really made a lot of difference. 

So it’s more accurate to say that we have built enough homes, historically, but not a surplus.

As for the current building levels, the 2016-2017 building figures show that net supply increased by 210,000 new houses (excluding house -> flat splits), whilst population growth fell.

So right now (2016-2017) we’re building many more than we need - something like a new home for every 1.8 new people - which is a good thing, but not surprising given the huge subsidies to building companies. 

Interestingly, as well as an increase in new housing completions it looks like there has been a very significant increase in change of use conversions (i.e. barn or shop conversions).

From this page it seems the figures I was using were new builds only:
https://fullfact.org/economy/house-building-england/

Using our most complete set of figures there were 217,000 more homes in England in 2016/17 than the year before, including the 184,000 that were built from scratch.

From the ONS:

The population of the UK at 30 June 2017 exceeded 66 million people (66,040,229), an increase of 392,000 people since mid-2016.
https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/bulletins/annualmidyearpopulationestimates/mid2017

In the UK there were 27.2 million households in 2017
https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/families/bulletins/familiesandhouseholds/2017

27.2 million  X 2.37 = space for 64,464,000 people

Comparing to our population of 66,040,229 thats a surplus of 1,576,229 or dividing by 2.37 again = 665,075 surplus houses

However we have:

...the number of empty homes in England in October 2017 at 605,891
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN03012

So arguably the surplus is 59,184 houses, equivalent to what we are building every three months, so it wouldnt take much of a downturn to change this surplus into a deficit.

I'm sure that all these figues would be looking a lot worse if we didnt have Brexit just around the corner.
 

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16 minutes ago, Habeas Domus said:

From this page it seems the figures I was using were new builds only:
https://fullfact.org/economy/house-building-england/

Using our most complete set of figures there were 217,000 more homes in England in 2016/17 than the year before, including the 184,000 that were built from scratch.

From the ONS:

The population of the UK at 30 June 2017 exceeded 66 million people (66,040,229), an increase of 392,000 people since mid-2016.
https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/bulletins/annualmidyearpopulationestimates/mid2017

In the UK there were 27.2 million households in 2017
https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/families/bulletins/familiesandhouseholds/2017

27.2 million  X 2.37 = space for 64,464,000 people

Comparing to our population of 66,040,229 thats a surplus of 1,576,229 or dividing by 2.37 again = 665,075 surplus houses

However we have:

...the number of empty homes in England in October 2017 at 605,891
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN03012

So arguably the surplus is 59,184 houses, equivalent to what we are building every three months, so it wouldnt take much of a downturn to change this surplus into a deficit.

I'm sure that all these figues would be looking a lot worse if we didnt have Brexit just around the corner.
 

I’m not sure I entirely follow this, I think you mean there’s 60,000 houses too few, which is wrong, but I think it’s what your calculations show. No?

Anyway:

1. 217,000 is net new houses, I subtracted off the number of conversions (i.e. houses turned into flats), to get about 210,000

2. 2.4 is a historically low people/house ratio. The fact that we are at that level is already evidence that there’s not a dramatic problem.

3. Building this year is well into surplus territory but, as you say, this could easily just be a fluke. Long term numbers do not show a clear surplus over the last decade, unless you take 1990s occupancy levels as a baseline.  In fact, the 2008-2013 numbers were terrible, and have only started to recover recently.

4. I think empty houses is a separate issue, because that’s about the distribution of houses.

We have enough houses, it’s just that aren’t being used efficiently. They’re being used a financial assets instead of homes. See also under and over occupied houses

4. My view is that a housing shortage hasn’t caused the housing crisis, and I believe the evidence for that is overwhelming (and isn’t limited to the population and housing counts). However, I dont think we can be complacent about that.  We’ve kept up with demand - just - and post 2008 we were not. We could easily face a real housing shortage at some point.

 

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11 hours ago, macca13 said:

I go for deporting.. 

we could not feed ourselves during WW2.. with 10% food imports..

now we import 65% of our food we are completely stuffed.. we are food vulnerable.. 

this hot summer has seariously effected food production, with global warming we melted 3.3 trillion tons of ice into the sea over 25 years.. 

this is accelerating so maybe 4 to 5 trillion tons more ice in the next 25 years our island will get smaller and population bigger.. 

very dangerous.. especially as we have killed 75% of our pollinating insects.. 

For fun, go to getmapping.com and see how much of where you live now was farmland in the 1940s

Maybe we should make newbuilds edible - wouldn't hurt the integrity of the build a jot :lol:

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34 minutes ago, BorrowToLeech said:

I’m not sure I entirely follow this, I think you mean there’s 60,000 houses too few, which is wrong, but I think it’s what your calculations show. No?

No by surplus I mean we have more houses than required to house the population. i.e. the opposite of my first post.

But as you say it is not a huge surplus - I wonder if the reason so many politicians bang an about the need to build more when there isnt actually a shortage is because they know a sigificant downturn will mean that new building will stop and then there is a danger we will see a shortage build up.

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I doubt the comfortably housed wealthy old folk near me that are organised and campaigning vigorously against new house building said a word against immigration.  Let them suck it up...the inevitable consequence of immigration on the scale we have seen and are still seeing is house building on the edge of existing population centres ruining the views of said campaigners....tough. the notion i expect they had all the newcomers would be housed somewhere else is risible .

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2 hours ago, Habeas Domus said:

No by surplus I mean we have more houses than required to house the population. i.e. the opposite of my first post.

But as you say it is not a huge surplus - I wonder if the reason so many politicians bang an about the need to build more when there isnt actually a shortage is because they know a sigificant downturn will mean that new building will stop and then there is a danger we will see a shortage build up.

And the 300,000 families now homeless in the UK, including 127,000 children (Shelter)?

And the 3.5 million young Britons between the age of 18-34 still living in the family home?

And the epidemic of subletting and beds-in-sheds in our cities and towns?

And the explosion of HMO licencing and multi-let subdivision?

And the uncontrolled, mass immigration bringing in an additional 300,000 newcomers net every single year?

How is any of this consistent with a housing surplus?! :rolleyes:

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7 minutes ago, zugzwang said:

And the 300,000 families now homeless in the UK, including 127,000 children (Shelter)?

And the 3.5 million young Britons between the age of 18-34 still living in the family home?

And the epidemic of subletting and beds-in-sheds in our cities and towns?

And the explosion of HMO licencing and multi-let subdivision?

And the uncontrolled, mass immigration bringing in an additional 300,000 newcomers net every single year?

How is any of this consistent with a housing surplus?! :rolleyes:

Because any/all of those people could find suitable housing if they only had the cash.

The housing market, like any other is driven by supply and demand, but it's not supply of houses that's the problem it is the supply of credit to buy those houses.

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Anw when I say credit is the problem what I mean is that too much credit has already pushed prices too high.

If the government brought in a new ruling that stipulated the banks can lend as much as they like on a house but anything above 3 X salary will automatically become Non-Recourse lending. That would very quickly sort out the problem, because banks would not wish to take on that level of risk, although at the moment they are happy for their customers to take the exact same risk.

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These house prices. 

For me it's in Global easy money, low rates, willingness of buyers to pay the higher prices over the last few years (when so many HPCers believed topped out), and the BTLers, with their claims on millions of homes, as their investment of choice to capture GenRent.

cliffnotes, rather than full article.

Quote

 

Migrants, house prices and the dog that hasn’t barked
April 15 2018.
  The Sunday Times

The assertion of housing minister Dominic Raab — in an interview with The Sunday Times last week — that immigration has pushed up house prices by 20% over the past 25 years seems to have been almost calculated to cause controversy.

The claim, which appears to have been derived from a model used by a quango that was abolished in 2010, has attracted a predictable barrage of criticism from housing experts. On a superficial level, however, the argument makes a lot of sense.

...Raab’s job is to try to raise the annual supply of new homes from 217,000 to 300,000, a figure that commentators on left and right agree is necessary to tackle Britain’s housing shortage, and rein in prices that have spiralled beyond the reach of all but the richest first-time buyers, or those who can rely on the Bank of Mum and Dad.

If chronic undersupply of housing is the basic problem, surely Raab was right to say we need to consider demand, too?

Look a little closer, though, and his assertions start to look a little shaky. More importantly, so does much of the received wisdom about Britain’s housing crisis.

Some of Raab’s critics have pointed to two recent studies showing that a rise in an area’s foreign-born population in fact brings about a slight fall in house prices

There is, however, a more fundamental weakness in the “immigration drives up house prices” narrative. Rents, not house prices, are the best measure of demand for housing; everyone needs a roof over their head, but not everyone has to *invest* in property.

...Unlike the average house price, which quadrupled to £215,500 in the 25 years to 2016, rents have risen much more slowly, climbing by less than 16% since 2011. More recently, they have actually been falling in real terms.

Clearly, investors have not been snapping up houses at ever-more stratospheric prices over the past quarter of a century solely in order to squeeze bigger rents out of their tenants. Rather, a gaping chasm has opened up between house prices and rents. It is very difficult to explain away this gap by way of increased demand for living space — whether from new arrivals or the British-born population.

...Ian Mulheirn, a former Treasury economist who is now at the consultancy Oxford Economics, has sought to dismantle the case that there is a housing shortage in a series of reports. Mulheirn points out that additions to the housing stock have actually outpaced the formation of new households over the past 2½ decades. There are more vacant homes today than there were in 1992 — a strange idea of a shortage. He then marshals the data on rents to argue that housing costs — as opposed to house prices — have not really risen that much.

If he is right that there is no chronic shortage behind the house price boom, it follows that building more homes (or cutting immigration) has little chance of bringing prices back to earth.

...So why have house prices soared?

The obvious culprit is low interest rates, both in Britain and beyond. Mortgage rates have declined throughout the long boom in property prices, particularly in the wake of the financial crisis when the Bank of England slashed rates to just above zero. At the same time, low rates elsewhere in the world have caused cash to flood into UK property — particularly in London — as investors seek even meagre returns or a safe harbour for their cash.

...However, this has been a home-made crisis as much as a symptom of global investors hunting for places to stash their fortunes. Crucially, the era of low rates and quantitative easing has coincided with the increasing “financialisation” of property — the transformation of houses from places to live into investment assets.

Britons have long regarded their homes as part of their pension pots. The whole notion of the “housing ladder” is predicated on the idea that getting a foot on the bottom rung will help us to save for retirement. The introduction of buy-to-let mortgages in 1996 helped to supercharge this tendency. Wealthier homeowners who had paid off their mortgages and wanted to continue saving could easily buy another property, creating a generation of accidental landlords.

In the era of low interest rates, these investors were arguably ready to buy houses no matter how quickly we built them. 

 


*invest in property would be buy a home for me, as a home, not thinking of it as an investment.  That's the problem.  Along with each and every BTLer buying up more homes, to capture GenRent.

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1 hour ago, zugzwang said:

And the 300,000 families now homeless in the UK, including 127,000 children (Shelter)?

And the 3.5 million young Britons between the age of 18-34 still living in the family home?

And the epidemic of subletting and beds-in-sheds in our cities and towns?

And the explosion of HMO licencing and multi-let subdivision?

And the uncontrolled, mass immigration bringing in an additional 300,000 newcomers net every single year?

How is any of this consistent with a housing surplus?! :rolleyes:

How is the millions of people who have two or three houses consistent with a shortage?

The effects you describe are perfectly consistent with a distributional problem. We could have a billion houses, and they’re no good if people can’t afford them. That’s essentially the situation we are in.

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56 minutes ago, Habeas Domus said:

Because any/all of those people could find suitable housing if they only had the cash.

The housing market, like any other is driven by supply and demand, but it's not supply of houses that's the problem it is the supply of credit to buy those houses.

Not quite - the problem isn’t just that they lack the cash, it’s that they lack the cash relative to ‘investors’. It’s the ‘investors’ who have too much, and so can outbid everyone else.

Ok, bit of a simplification, it’s not just investors, but it’s the excess of lent money that is crowding out earned money and the fact that some people get preferential access to it that determines who can buy.

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16 hours ago, inbruges said:

I agree, it should be government policy to be able to produce  80% of our own food with a crisis plan that we can produce 100% in a very short period, we will get caught out one day. where do we get the money to do this, stop throwing £trillions into the property market and start using that money elsewhere, farmers to start with for example

Only problem is if you ramp up our food supply to the max, that’s allot more pollution.. I have watched programs about the streams near farms dying from the byproduct left over from crops/animal slurry.. 100% of life wiped out, fish, newts, otters..  also fields that we now leave to nature support all sorts of bugs and insects.. start spraying pesticides around and swapping flowers for grain you lose allot more of already depleated wildlife.. 

the simple problem is there are too many of us.. we need to reduce our numbers or face disaster in the not to distant future.. 

Edited by macca13

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6 hours ago, macca13 said:

Only problem is if you ramp up our food supply to the max, that’s allot more pollution.. I have watched programs about the streams near farms dying from the byproduct left over from crops/animal slurry.. 100% of life wiped out, fish, newts, otters..  also fields that we now leave to nature support all sorts of bugs and insects.. start spraying pesticides around and swapping flowers for grain you lose allot more of already depleated wildlife.. 

the simple problem is there are too many of us.. we need to reduce our numbers or face disaster in the not to distant future.. 

People arguing about the population density in the UK suggesting how we could take so many more, using the little wilderness we have left as an excuse to double out population yet again with people who are of little use to us in most cases.

Ireland has a population of about 3 million, Sweden about 7 million, France with it's own immigration problems has about the same as the Britain with twice the space. If you look at England on it's own  its population is just mad, there is a big part of me and many others who just want see England become so unattractive that immigration halts or even back tracks.

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  • 140 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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