2024 Election thread
Comments
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buying a house in your lifetime for the majority of people born after 1995 is also a pipe dream, so you might as well fight the good fight.
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This is the salient point. If you build more houses, there will be a greater supply of houses at roughly the same price they currently are. There are over a million housing transactions in the UK each year. About 200-250k houses are built a year at the moment. So you'd need to increase house building rates above the current roughly 1.2-1.5 million annual transactions enough to make a dent on prices.
That's the supply and demand argument, right RC?
Even if you did, say double the rate of new homes, and add more rapidly to the housing stock for a few years, the effect would be temporary.
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Dumping large volumes of housing randomly around the country is not a good fight in my view, even if it were feasible. I think you new found 'Radical Rick' persona is not thinking these things through properly.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Why have you decided "building houses where people want to live" is the same as "dumping large volumes of housing randomly around the country"?
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Surprised he didn't just blame it all on avocado on toast tbh.
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No, I'm assuming demand will just reflect supply. Which I l've assumed is the number of houses for sale each year, which is the supply if I'm trying to buy one.
Suppose that could be wrong. I suppose the other question is how the total supply will change. Currently about 25 million dwellings.
My rudimentary understanding of either number is that it's much bigger than the number of houses that can be built, so I don't see how it will shift prices that much.
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Logic would suggest that there will be a point where not enough people can afford housing and / or rent so prices will have to stop rising or fall. The problem is where that point is and what happens to those who can't afford somewhere to live before you reach that point?
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The limit is a way off. Because mortgages will soon become a proportion of the house, or multi generational.
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You seem to have circled back to "It's too big a problem lets give up"
- Genesis Croix de Fer
- Dolan Tuono0 -
- Genesis Croix de Fer
- Dolan Tuono1 -
No. Just that availability and price aren't necessarily going to be interlinked in the way people are hoping.
Am at limit of my understanding here, but hypothetically, if you were to flood just one part of the market - i.e. small new builds for first time buyers - enough to significantpy reduce prices, what would the knock on effects be in 5-10 years when those people start families and want to move house?
Assume it would create an even bigger price jump between, e.g., flats and 3 bed houses, and inflate the price of the latter even more?
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What's your idea then?
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There's a perception that this is the case in some of the provinces. It comes to an extent from EU directives and the targets derived from these, doesn't it?
Most likely it's wrong anyway.
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The number of sales each year reflects the transaction volume, not the supply. Indeed, you could realistically have a situation where house prices tank but the number of sales go through the roof (pun intended), as all the distressed homeowners sell up at bargain prices.
Indeed, a dramatic rise in the number of trades happening in a stock market can sometimes mark the beginning of a crash.
So again, by focusing on the number of transactions per year, you're focusing on the trade volume and not the supply or demand.
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Has anyone suggested doing that?
- Genesis Croix de Fer
- Dolan Tuono0 -
The reason I'm suggesting loosening up regulation is that the homebuilders will be then encouraged to build houses people will want to and be able to afford that will make money.
If they build a house in a location where no-one wants to live, they won't make profit.
The market is in general pretty good at matching what people need, as it rewards firms that do and punishes firms that don't.
Currently it's not especially easy or economical to build a bunch of houses and that needs to change. I think a large part of that are the ridiculous hurdles and consultancy fees that are required to get to the point of building, and even then after all that expenditure you run the risk of a local council blocking it.
Lower the cost of building homes and it will be more profitable to build more. I'm not suggesting lower the quality of homes available, but I think a disproportionate cost is around dealing with local regulations, nimbys, objections and all the rest. Not everyone needs or should have a say in building development.
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Paging #rjsterry as he seems to be involved in this field.
Are Ricks assumptions correct that removing hurdles and consultancy fees will dramatically reduce costs?
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
Fair enough. I think a housing market fire sale is sufficiently unlikely that we can discount it. It isn't stocks and shares. History shows that when the economy is bad and the market is bad, people tend to stay put.
So the supply is 25 million. And if you build half a million houses it's gone up by 2%. What's that going to do to prices?
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It's not just those. It's also allowing building to happen in certain locations, e.g. greenbelt land etc.
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I am absolutely no kind of expert and have little experience in this field but does noone else think that limiting the amount a bank is allowed to lend for a house purchase to, say, 4 x salary would have a more immediate and permanent effect on house prices?
It seems that the banks are taking advantage of the desperation of people to buy by leeching every last penny they can (a "market force" of sorts I guess) for as long as they can which increases the amount that people are able to offer for a property.
Assuming wages were not cut accordingly, if the number of people who could afford the asking price was lower or non-existent (as they couldn't borrow as much), surely the asking prices and required deposits would reduce . . .
I await being educated on why the above would not go some way to solving the problem!
Wilier Izoard XP0 -
https://commonslibrary.parliament.uk/research-briefings/cbp-7671/
The current Government has diagnosed the planning system as central to the failure to build enough homes, particularly where housing need is at its most severe. There’s a continued focus on supporting private sector delivery. The Levelling Up and Regeneration Bill currently before Parliament contains measures to reform the planning system.
This paper focuses on the main barriers and possible solutions to increasing supply in England, including:
The potential contribution of the local authority and housing association sectors. The widespread view that meeting delivery targets will require major public sector investment in a housebuilding programme.
How to ensure more land suitable for development is brought forward at a reasonable price, including how more public land can brought forward more quickly.
How to properly resource local authority planning departments and address a planning system that’s widely seen as slow, costly and complex.
How essential infrastructure to support housing development can be funded.
How to encourage and support more small and medium sized (SME) building firms into a market dominated by a small number of large companies.
How to ensure the construction industry is in a fit state to deliver housebuilding capacity, eg through improved training. The Government commissioned Farmer Review of the UK Construction Labour Model (2016) concluded “many features of the industry are synonymous with a sick, or even a dying patient.”
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I think you have this back to front. The shortage of homes is driving up rents and allowing some landlords to ignore upkeep. That poor upkeep will reduce the value of their property in the long term. Building more homes would make it harder to let poor accommodation.
1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
Is this true? What is the cost breakdown of land purchase, build cost and marketing costs, Vs the planning costs?
Genuine question.
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😆
(Labour have bought advertising space on the ConservativeHome website)
1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
You may be right.
I still think there are much much more economically productive ways to invest your tens or hundreds of thousand of pounds.
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Providing a fundamental basic need for people seems a useful way to spend your money. The biggest residential landlords are Housing Associations.
I'm sure you could find better returns, but that's not necessarily the only goal.
1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
The house is still there, whether the landlord owns it or not.
My point is the returns of being landlord are disproportionate to their actual value to the economy. The fact it's mainly a cottage industry suggests there's a tonne of inefficiency, that's borne by renters.
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As someone involved in the house building sector to a degree I really don't understand what you mean by this. Are you suggesting relaxing Building Regulations? If so, that would be a bad move - if you leave it to Developers to decide what to build based on what the market wants you can forget about any improvements in environmental standards. There are other hurdles such as flood risk that make it difficult to develop but only a fool would be looking to relax those when you look at today's news. The biggest obstacles are finding suitable land, getting planning consents and finding enough skilled tradespeople to build the houses quickly enough. Add to that, the land that is available is generally not ideally suited for sustainable development i.e. people are probably going to have to use a car to get around quite a lot. I'm all for opening up more land but providing the infrastructure to make that sustainable is a far bigger challenge. Also, where would you draw the line on making land more available - would you allow building on somewhere like Clapham Common or even Hyde Park? There is a huge tranch of open space in South West London with Richmond Park, Wimbledon Common and Putney Heath that falls within the area that people want houses so should that be fair game? I'd start with golf courses, it feels unreasonable to have large green spaces in built up areas that are for the benefit of a small number of members (often rich Boomers too) - it would presumably count as Brownfield too although I'd have to check that.
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It's a large number as FA has explained above. And different people want to live in different places, so the overall result of just building where people want to live will be pretty random, unless you don’t really mean 'where they want to live'.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0
