Thursday, January 24, 2013

The Rent is too Damn High

Why the UK high street is going bust

Last nights BBC One Show hits the nail on the head. Rental values are the real problem on the high street and landlords will not cut the rent as this will then trigger problems with the properties value and their commitments to their banks. A nasty vicious cycle that is ruining our high streets http://www.unsustainablefuture.com/forum/index.php?action=post;board=1.0

Posted by pete green @ 09:27 AM (5794 views)
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18 thoughts on “The Rent is too Damn High

  • Finally the wheels are coming off the property and pensions ponzi. It’s about time!

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  • Maybe its also because their larger competitors are engaging in tax avoidance on a massive scale.

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  • @Khards- I Don’t know, i just wouldnt be so sure, we have had lots of false dawns on a retrun to housing affordability.
    Wholesale fraud and theft has already been sanctioned from on high, and in effect rewarded. It seems like there is nothing they wont attack, devalue or de-base (apart from property potfolios/land values)
    Regards the One show link, i cant bare to watch the programme, bubble gum, post teatime drivel (even the rather lovely Alex Jones cant keep me watching)

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  • happy mondays says:

    Rental values are the real problem on the high street and landlords will not cut the rent as this will then trigger problems with the properties value and their commitments to their banks.

    I suspect the same with residential!

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  • Good to see the area i live in will be a ghost town in 2-3 years.

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  • These property companies really are the cancer of society

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  • A total blood boiling article to recognise that rents are too high, but then saying nothing of the reason why i.e. ZIRP and QE, is terrible reporting. Like it’s something that the serfs just have to live with and duly pay their masters.

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  • nothing to do with supermarkets with their terrible tricks and cons killing high street ?

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  • Ehem, well yes, but that is because of the property bubble, facilitated by artificially low interest rates, which also reduce people’s savings, which mean less cash to spend.

    And of course, Government refuse to reduce VAT and Business Rates, so this cannot be blamed on the market. Enough of this Socialist propaganda that the Market is dysfunction. No, the market has been destroyed by government intervention in money markets and via taxation and regulations.

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  • I was in my local guitar store in the center of town at lunchtime and noticed a sign up that they were closing down in February. Asked why and rent was the main reason. Said they needed to make £57K a year just to pay for the shop.

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  • Mark, I am not sure that the supermarkets are to blame as the independents here in Ireland seem to be doing ok. Most of the smaller stores here are franchises and put the likes of Tesco to shame over quality and pricing.

    Much of the time independents do not make economical sense due to buying power and marketing cost for a single outlet. Franchises of smaller stores for example are a much more viable proposition as you cut marketing costs and can get cost prices down by buying in bulk.

    I do agree that the likes of Greedy landlords, corrupt banks and Tesco not paying tax, manipulating property markets by buying up land does not help.

    There are some great smaller outlets here like Joyces, Centra, SuperValu and Eurospar.

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  • mark wadsworth says:

    What Khards says.

    To the extent that tax is an issue, what they ought to do is halve VAT and treble Business Rates and end empty building exemptions. That’ll give landlords the kick up the a-se they need.

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  • The major tricks of the supermarkets is that they avoid market rents & corporation tax with respect to thier competition. I.e. They are able to purchase land without the necessary planning permission and play at land banking games with thier competition. The discount stores like Aldi use less expensive sites as a niche player.

    Libertass, humour me by laying aside you own remedies for a moment, would you agree that an LVT would result in much more level playing field, creating a more true free market in retail and that will put an end to the supermarkets land banking and distortive planning shenanigans? LVT, as opposed to business rates, would also promote investment in store infrastructure as the site value is taxed and therefore promote investment and more efficient use of land.

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  • supermarkets are to blame as the independents

    I think they are; as they can ‘bulk buy’ and force the prices they pay to farmers right down. They can also buy land in order to provide parking. Most people are driven out of the high street because parking isn’t available or is very expensive.

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  • Also to blame the businesses themselves who didn’t keep up with the technology; the internet companies; the non-tax-paying retailing organisations which creates an unlevel playing field; parking fees that are being used to pay the salaries, pensions and expenses of local authority employees and representatives; obese unfit people who lack the energy to walk up and down the high street.
    I have to say though that I am really pleased that HMV is being saved – browsing heaven.

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  • @Parabolic, Libertas
    The inflated rents predate ZIRP and QE by many years.
    N

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  • I unfortunately live near to large mall and retail park outlet. There are no high streets around here in any of the towns, they have all been destroyed as everyone goes to the mall and outlets. This, online shopping and high property prices/rates, and i don’t think that the high street has much chance.

    As our lives, well those who work and therefore are spending the most money, are increasing busy with longer commutes and work hours, and therefore convience of online shopping, malls and outlets is valued over quality of high street and independant retailers.

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