Saturday, Dec 26, 2015

Not mentioned..

Archinect: London's Bleak Housing

State of London housing. Apparently Tower Hamlets has been the only borough benefiting from additional construction. One of the reasons mentioned for the urgency of building is because of a " there is a mass exodus of 30-somethings in London that needs to be stemmed" due to spending half of their income in rent.

Posted by stillthinking @ 04:18 AM (8280 views)
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40 Comments

1. latterdaysinner said...

As always, planners are rather out of touch with reality. Unless the same body is in charge of both planning and building, they can only ever act as a break on development, exercising negative control but not being able to do anything to increase the rate of building.

I've posted the following chart on this site before. It shows an index of the value of private residential construction work in London, alongside the one for GB as a whole. The data is taken from the ONS, put into real terms and indexed at 100 at the start of 1980. To put it into context, I've charted the Nationwide London and GB house price indexes in the same graph on exactly the same basis.

I think the chart speaks for itself. There's a massive residential construction boom going on in London at the moment. I doubt that planners had anything to do with this. More likely is that developers are responding to the extreme price signals in the market. I wonder how long this can last.

http://imgur.com/wwAzyd1

Saturday, December 26, 2015 10:47AM Report Comment
 

2. taffee said...

Same old same old.....problem is there is a supply shortage ON THE MARKET mainly due to hug props...there is actually plenty of property it's just in the wrong hands...there was huge demand and building prior to the collapse of other property bubbles....Spain....Ireland....Dubai....USA....

Think of it this way...when prices fell in 2007/2009...there was a glut of properties you couldn't sell as demand fell off a cliff.

Why if property is so scarce do we have any props at all...like help to buy overpriced property?

Saturday, December 26, 2015 11:10AM Report Comment
 

3. taffee said...

Meant hmg props

Saturday, December 26, 2015 11:10AM Report Comment
 

4. libertas said...

There has ALWAYS been a mass exodus of 30 year olds from London.

Many at our office keep speaking of leaving until they find they will have a 30% pay cut with no chance of progression in the sticks, discovering that as such, buying a flat in, say, Havering, Redbridge, Bexley or Enfield is more affordable with significant greater capital gains.

Monday, December 28, 2015 09:22PM Report Comment
 

5. nickb said...

So let's get this straigt: a mass exodus is an argument for building more housing.
But also, frequenters of this site will recall that mass inward migration is a very normal argument for building more housing.
Is there any situation that does not provide an argument for building more housing ??
Happy new year!
N

Monday, December 28, 2015 11:27PM Report Comment
 

6. taffee said...

Not just building new properties but hmg giving up to 40% deposit...completely insane

Tuesday, December 29, 2015 07:37AM Report Comment
 

7. taffee said...

More Londoners in 2015 sold their houses and moved out of the capital than at any other time since the financial crisis, new figures show.

Research by property firm Hamptons International revealed 63,000 households have left London for the suburbs in the last 12 months the highest number since 2007.

The companys head of research Johnny Morris linked the numbers to the capitals soaring house prices, suggesting homeowners were hoping to cash in on the boom that has this year seen the average cost of a home top 500,000.

http://www.standard.co.uk/news/london/number-of-families-leaving-london-to-buy-cheaper-homes-elsewhere-hits-eightyear-high-a3145291.html

Tuesday, December 29, 2015 07:40AM Report Comment
 

8. judgandury said...

More importantly, London's population is currently increasing. London is the birth rate capital of Europe. London's women are having more babies than anywhere else in Britain and Europe (17.7 babies per 1000 compared to a European average of 10.4). In outer London women are having an average of 2.18 babies which is also more than anywhere else in Britain or Europe.

Tuesday, December 29, 2015 01:07PM Report Comment
 

9. mombers said...

@8 but we're still below the 2.1 births per woman replacement rate (I imagine the outer and inner London rates average out to less than this and the UK rate is 1.90). Our unfunded pension and old age health care programs simply don't work without a steady retired to working age population ratio. Do we allow in many more immigrants? Ask wealthier pensioners to chip in for themselves and their unfunded peers? Or just keep hammering the working age population with higher and higher tax rates on their private property?

Tuesday, December 29, 2015 05:46PM Report Comment
 

10. judgandury said...

You are veering off topic and are incorrect in your assumptions. You can't just cut and paste a small portion of an equation, take it out of context and draw a conclusion from it. To make any sense of the situation you need to factor in complex changing trends in human productive duration and also the standard (Births + Immigration) - (Deaths + Emigration).

Getting back to the topic. There is little point in emphasising a so called exodus of a small demographic without acknowledging that the overall population of London is increasing, has been for some time and is universally forecast to continue doing so.

Tuesday, December 29, 2015 08:35PM Report Comment
 

11. mombers said...

@10 yes the population will keep growing despite a birth rate below replacement due to births minus deaths and net immigration. But the way it is growing has consequences - an ageing population will eventually require repudiation of unfunded old age welfare and/or much higher taxes (particularly on the working age population unless the political climate changes). The books are also only balanced by continuing high net immigration as the OBR forecasts show. So plenty of difficult choices ahead. We're in a much better position than most other western nations though. There are attempts to push the birthrate up in many nations (Italy, Germany, Japan) but it appears that the horse has bolted and it will be very hard to get people breeding again.

Wednesday, December 30, 2015 09:39AM Report Comment
 

12. mark said...

another couple of issues

sellers are holding out for stupid high prices

we have met several sellers who simply don't want to sell, asked them why they say we fear we won't be able to buy another house, ask them why they list their houses and waste our time viewing - answer because we want to sell

it is like idiot world

Wednesday, December 30, 2015 10:07AM Report Comment
 

13. mombers said...

@12 the joy of finding out that rising house prices mean the rungs of the fabled property ladder get further apart. We're 100k down already after 2 years - a move to a house is now 100k more than it was when we first bought.

Wednesday, December 30, 2015 10:20AM Report Comment
 

14. judgandury said...

The usual fact and data free off topic to support your reactionary obsession with persecuting old people. Did you understand a word of what I wrote? People are increasingly living and working longer which shifts the decades old assumptions you're attached to. Over the last three years there has been a dramatic increase in workers over the age of 65 such that there are now 1.2 million of them. Not only are these 1.2 million not requiring support but they are actually supporting others. Wealthier pensioners (more than 4 million of them) are also paying a great deal in monthly tax which means that they are also supporting others. Retired people now pay 12% of the UK's total income tax revenues. Let's not also forget that most of them spent a lifetime contributing and on their death the government will receive another chunk from many of them. They will then pass on what is left to young relatives which provides further support. Your portrayal of pensioners as some sort of dead weight therefore has no basis in fact, decency or reason.

The effect of the increase in over 65s still working and more pensioners paying tax is compounded by a dramatic increase in the number of young and fertile immigrants and an increased birth rate. Brand new data has come in this year which shows that the age of our population has actually started to reduce in several areas. This trend is predicted to continue. Your convenient tale of woe is out of date.

Wednesday, December 30, 2015 10:47AM Report Comment
 

15. judgandury said...

"@12 the joy of finding out that rising house prices mean the rungs of the fabled property ladder get further apart."

You are part of the problem. You spent years here insisting that we didn't need any more housing.

Wednesday, December 30, 2015 10:56AM Report Comment
 

16. mark said...

Judge

wtf , i never once said we didnt need any more housing, i said people need more sense and estate agents need to be regulated

Wednesday, December 30, 2015 11:05AM Report Comment
 

17. judgandury said...

mark, sorry old boy, that wasn't meant for you. It was a reply to 11.

Also not aimed at you...

Another thing our unsophisticated granny haters fail to factor into their one dimensional calculation is the support grandparents routinely provide for their families. Millions of people are only able to work full time because grandparents are doing school runs and child minding.

Wednesday, December 30, 2015 11:52AM Report Comment
 

18. mombers said...

@15 that was unnecessary. As I said, I have never and will never oppose building - that's what the market is obviously crying out for and it is being completely manipulated and crippled. Last week I put in a supporting comment on an application for a conversion of a house into 5 flats across the road from me. More housing and jobs for everyone - what's not to like? More housing would certainly help but it's not the only solution and absent any incentives to use our existing housing more efficiently, people will be spending more and more time commuting, exacerbating the weak productivity that the UK suffers. I am lucky in that my commute only takes 50 minutes. I work with people who spend 4+ hours a day commuting and never see their kids. We're having a really hard time recruiting as well - at the margins, talented people will not take a job that involves such a sacrifice in commuting.

It's great that grandparents are helping out, it is a useful service and it's not right that it doesn't count in GDP calculations and is not formally recognised as a contribution. But neither does the incredible work that stay at home mothers do. Hats off to the mums and grandparents!

Wednesday, December 30, 2015 12:11PM Report Comment
 

19. mombers said...

@judge BTW what's your take on the NHS crisis? Not something that an ageing population is contributing to? It's not rocket science that older people need a lot more healthcare than younger ones. The raising of the state pension age is great (and needs to go up a lot faster than planned IMHO) but there is no way to stop spending ever increasing amounts on vulnerable old people, which believe it or not I do not advocate.

Wednesday, December 30, 2015 12:19PM Report Comment
 

20. judgandury said...

"As I said, I have never and will never oppose building"

Unbelievable. End of conversation

Wednesday, December 30, 2015 12:37PM Report Comment
 

21. mombers said...

@20 please don't end the conversation! I apologise if I've not been clear on this, please do let me know which of my comments led you to the conclusion that I do oppose building and I can brush up on my delivery!

Wednesday, December 30, 2015 01:05PM Report Comment
 

22. judgandury said...

" @judge BTW what's your take on the NHS crisis? Not something that an ageing population is contributing to"

As per usual, you failed to understand or react to any of the data provided and just rolled on to the next reactionary comment. I wouldn't entertain anyone with your anti social tendencies in the wider world, so I don't see why I should here. Over the last few months we've seen that data, evidence and economics is not your thing, so all that remains is to suggest that you grow up and show some respect. You'll be old one day and you had better hope that there won't be too many of your sort around. Britain is far from perfect but we have a proud tradition of resisting extremism. All extremists are convinced that they are right and therefore justified in their spiteful targeting but they always end up disgraced. Aim your anti social spamming at someone else in future because I won't respond to you.

Wednesday, December 30, 2015 01:06PM Report Comment
 

23. mombers said...

*sigh*

Wednesday, December 30, 2015 01:53PM Report Comment
 

24. sneaker said...

Please everyone shut up and enjoy your next free market experience.

Wednesday, December 30, 2015 04:22PM Report Comment
 

25. judgandury said...

About 5 or so years ago I alerted this site to two things. The first was the relationship between employment/unemployment and house prices. It was my own proprietary research so I was not surprised that it was met with considerable resistance but some were interested and the relationship has finally gone mainstream. The second thing I alerted this site to some 5 or 6 years ago was the growing housing crisis caused by a suddenly sharply increasing population and persistent and declining building rates. I was not surprised that this was met with howling resistance because people did not want to believe that there was anything fundamental supporting house prices. Around that time I started to volunteer for a housing research unit so I was able to post all the latest data. Even the data was was met with the most unbelievable hectoring and abuse from people with no serious information to hand. The worst abuse came from the LVT crew who swore up and down that there was no real increase in population and that we needed no more housing. Again the existence of the housing shortage has now become universally accepted, so my work here is done. I have no new research to offer this site and I'm not interested in many of the cut and paste, cod economic arguments, so it's adis until such time as I have some new research to offer. I can't think of anything more that could be relevant to house prices, so I'm not sure I'll be back.

Wednesday, December 30, 2015 05:14PM Report Comment
 

26. Iain Gill said...

There is always an exodus of people as their children reach school age and the reality of how poor the inner city state schools are hits home. Would be much better if parents had complete control of their state school budget and all the catchment area nonsense was swept away.

Wednesday, December 30, 2015 07:16PM Report Comment
 

27. libertas said...

Judgandury, agreed. I think that the situation has formed as you have stated, we are too close to 2008 for momentum and sentiment to reverse, and so I think you are right. Sit back, hold tight and try to work out what the trigger will be for the next correction. My own personal believe is that prices will reverse if Europe recovers and sucks people out into the vast Eurozone area. This could result in a collapse of Sterling or a soaring of the Euro, but I do not see that happening for a few years. Before you go, I would be keen on your thoughts.

Wednesday, December 30, 2015 10:26PM Report Comment
 

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29. nickb said...

@J&J
What "research" have you done please? Where can we find your reports, articles, etc?
Thanks,
Nick

Thursday, December 31, 2015 04:55PM Report Comment
 

30. judgandury said...

libertas @26, thanks for saying that the situation formed as I stated but that suggests that I predicted something. It may seem sometimes that I make predictions but I am invariably just reading very current data and surveys (or occasionally observing a historical correlation). You have to pay quite a lot for the good stuff (particularly the surveys), so most people only see snippets of what I am lucky enough to have access to, quite a bit further down the line. A good example of this was when I told people here that wages would officially be reported as exceeding inflation within a certain time-frame (probably 4 or 5 months time). They did but no tea leaves were involved. I just read it from an expensively compiled private survey and directly repeated it here. I didn't pretend otherwise because I said that I was getting it from a survey and named the survey company. It didn't stop someone arguing that I was definitely wrong and quoting old Google search data to prove it (probably 9 months older than mine in real terms).

Occasionally you have to roll up your sleeves and do research yourself but it's quite a commitment. The first research I presented here was the unemployment/house price stuff. Long time contributors will remember that I posted details of my outputs, conclusions and methodology several times. I see that one of our angrier egg on face wallahs is snidely asking for links but I really don't respond to bad faith requests and it is particularly dumb to think that I'd happily give away my identity to a potential nut case. In any case you'd have to be a serious halfwit to think that I managed to somehow guess at a specific multi-national relationship (with an extremely thin to non existent body of work behind it) and detail specific metrics on it that turned out to be accurate. I must have been even luckier to have guessed it 5 years before the BOE and LLoyds Bank published the exact same findings.

A few weeks ago, I posted details of exactly how the housing shortage can be calculated and projected on a district by district level. There was previously no district level calculation available. The research idea was mine (auditing DC land supply statements and extrapolating where NPPF compliant plans/approved methodology were not yet in place). That took about 20,000 miles of driving and countless hours of tedious auditing. I volunteered my time, car and expenses for free to get it done. Details from it will be coming to a newspaper article or two in six or so months time. Please therefore forgive me, HPC'ers, if I occasionally lose patience with the fortunately few of our more deluded/conceited chaps who think they definitely know better (on the housing crisis) despite having next to no data and having put in absolutely no effort. Please don't ask me any more questions because I don't want to appear rude by not answering.

libertas, regarding your question about future triggers etc. I genuinely have no clue. I actually worked in the prediction game for a number of years and am firmly of the opinion that it is not really possible to predict anything with a reasonable degree of certainty. I am entirely genuine when I say that my best guess would be growth followed by recession, then growth then recession and so on for ever.

Friday, January 1, 2016 01:14PM Report Comment
 

31. libertas said...

judgeandjury, are you seeing a housing shortage more acute than is being reported? Anecdotally, and it co-incides with the refugee crisis, I am seeing serious uplifts in previously suppressed areas in London. A sense of panic from those not in the market. Working in a planning department I am also seeing that we have had 20% increase in planning applications year on year, but there is a sense that this will not be enough to satiate demand. Looking at central London, the boom is ridiculous with cranes everywhere, but it seems to be quite a good balance of commercial and residential unlikely to do anything to resolve any shortage, because with open doors to Europe and via the porous border, practically the whole of the African, Arabic and Asian continents, the demand for homes, so long as jobs can be provided, is virtually infinite.

This was not the case in the recovery after the 1989 to 1992 economic crisis because we only got open borders soon after Blair in 1996 onwards, and at that stage it was from prosperous nations where folk did not really necessarily want to move from, like France and Germany, prior to 2008, but then we opened to eastern Europe and after 2008, folk from previously wealthy parts of Europe began flooding into England, with now a torrent from actually beyond Europe, where any level of squalor we offer is countless times better than a hyper-inflationary, genocidal warzone!

Our "leaders" must be out of their minds or the Fabian Socialists went from incrementalism to outright Trotskyism to destroy the Anglo Saxon liberal model towards international socialism. As I have said many times before, if you thought National Socialism was bad, just wait for International Socialism, where you get nothing and our National Health Service and welfare system is plunging to the lowest common denominator, with Cameron siding with the Poles when they say "don't discriminate and not support Polish people (so we do to have to), just get rid of your welfare system for Poles and Brits alike" and so equality becomes a state of being equally poor, at zero benefit to anybody, it being simply the abolition of ambition and social justice anywhere, and so the Communists within the Socialist movement, in a despair that their system cannot compete with Capitalism seek to destroy everything.

Friday, January 1, 2016 06:55PM Report Comment
 

32. libertas said...

Rather than import squalor, we should seek to perfect our own system and attempt to export it, through education, trade and foreign policy of peace, friendship and iron clad defence rather than attack, but the latter involves arming the people as in Switzerland rather than producing a standing army for sale to the highest bidder.

Friday, January 1, 2016 06:59PM Report Comment
 

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37. libertas said...

Regarding government having to be the builder, this is only because the ludicrously high levels of taxation we experience today have distorted the economy away from productive house building, and, house maintenance, which is why so many homes are in a dreadful state of disrepair, because you get 20% VAT on home improvements, but VAT free on new homes.

The problem is, that when taxation levels reach this high, the expensive value added things like homes drop out of the picture.

Fact is, our greatest ever building boom was the 1930's, which was just prior to the UK's adoption of National Socialism, which as I have said, has moved in its intended path towards International Socialism, which was always the wet dream of the big name Socialists from the beginning and becomes no more than an extension of the Imperialism that has occurred in Britain for centuries, as we maintain a position as a wealthy country, yet retain a huge underclass, which is symptomatic of such a vast re-distribution of wealth. More recently, this has been ludicrously expensive wars that gained us nothing, insane taxation of carbon that plants breathe, pushing industry out to China where they have no environmental regulations and subsidy of the European Union in so many ways including ridiculous regulations over even what size light bulb or hair dryer we can purchase.

The best way to enhance the building stock is end VAT on household extensions and architects fees, etc. and home improvements alongside eliminating National Insurance payments for staff employed in the construction business who earn below a certain threshold and scrap the Community Infrastructure Levy, instead funding infrastructure through a slashing of foreign aid to the world's most corrupt nations, things like that, where our Foreign aid budget is ring-fenced, yet we slash social care for the elderly.

And we have to put a TOTAL end to social welfare for NON UK CITIZENS. Come here, and if you can't work, go home, but if you are here, as when I go to Spain or Ireland, I have to purchase private health insurance. Work hard, have a family, be here seven years and then you have earned a place in our social welfare society. Stop dismantling it to create a common market for standards of living where we drop to the sort of status of eastern Europe, where they cannot afford to pay welfare payments. I still cannot believe that there was no uproar when the Polish PM said, eliminate social welfare because Poland does not provide it. That we can reverse what was achieved early in the 20th Century to not "discriminate" against Polish people. Just total nonsense, but people buy it, so we are where we are and government has to be the builder because those who should be building simply do not have any cash to do so.

Tuesday, January 5, 2016 06:00PM Report Comment
 

38. novice pete said...

Should I have posted 'flies on excrement'?

Friday, January 8, 2016 02:37AM Report Comment
 

39. nickb said...

@J&J
You did not comply with my very reasonable request, other than to hurl back an insult. A cynic might think you are all bluster and no substance. I will repeat it:

What "research" have you done please? Where can we find your reports, articles, etc?

Thanks,
Nick

Friday, January 8, 2016 11:07AM Report Comment
 

40. judgandury said...

It's always the same when I say I won't be posting for a while. Oddballs with a grudge creep out, in the hope that I wont respond.

@38 Comply? I recently asked you not to address me again, so why pretend to be surprised (don't you remember that it was exactly that sort of dishonesty that took you off my reply list?). Slowly re-read what's written above if you need clarification. Pay particular attention to the bit about it being dumb to expect me to reveal my identity to someone like you, especially when the request is snide. There are already quite enough spammers following my stuff around (some poor sods writing articles for a housing charity have even been mistaken for me and now have spammers following them too). Only someone with dishonest intentions would pretend not to have noticed that I have provided thousands of data points and many specific details and outputs of research to this blog over the years. I even gave details a few posts ago of a specific (quite unique) research project. On the other hand, I have occasionally wondered if you actually read what's been posted because your replies never take seem to take account what's gone before (QED your last post). By way of contrast, you have provided absolutely no information to this blog over the years, other than the errors highlighted above, so how can you realistically expect me to regard you as someone worth interacting with.

Look I get it, you are angry and embarrassed at being shown up for your frequently made bizarre claims that oil prices would never stop spiralling (despite a professed expertise you were somehow oblivious to the fracking supply that came on tap shortly thereafter) and the perhaps even more bizarre claim that the population of the UK hadn't recently increased. I'm afraid that performance really does matter, even in the blog world. No matter how hard you try, pestering me won't wind back the clock so take responsibility, learn from your mistakes and please stop trying to engage me.

Friday, January 8, 2016 01:58PM Report Comment
 

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