The economy, the housing market, and the truth

[Ela James]

Let me start by this very general impression. For several weeks I have been trying to find out if the housing market has been encouraged to grow so, firstly, it will provide homes for those who need it ( I think there is actually more demand than supply ), and secondly, I feel if you help the housing market then you automatically help the overall economy, something we definitely need.

 

Luckily today the BBC published an article titled “ Planned homes remaining unbuilt, say local councils”

Almost 400,000 homes in England have been given planning permission but have yet to be built, research suggests.

http://www.bbc.co.uk/news/uk-england-23790071

 

Could I ask if we could, please, leave politics on one side and focus only on the facts and the problems and the best way to solve them

May I start by saying if you believe like I do that there is demand for new houses that has not been met, what is in your opinion the reason?

[angos]

There are many people with a vested interests including builder, banks and politicians that benefit from high property prices, and building enough houses for everyone could cause prices to fall which would be really bad for the people with an interest in keeping them high.

[Ela James]

Thanks,

You said “ There are many people with a vested interests including builder, ..etc”, can you explain how a builder would benefit from lack of building

[angos]

Thanks,

You said “ There are many people with a vested interests including builder, ..etc”, can you explain how a builder would benefit from lack of building

 

They own the land that as planning permission to build houses and its the land value that increases, it doesn't actually cost any more to build an house now than it did 10 years ago, but they sell for double the price.

[altus]

Thanks,

You said “ There are many people with a vested interests including builder, ..etc”, can you explain how a builder would benefit from lack of building

 

They'll build eventually but lots of new houses coming onto the market in a short time will cause prices to drop so they'll make less money. Better for the builders/estate agents/banks/etc. if they are drip fed into the market slowly to maintain the high prices.

 

With politicians the problem is slightly different. Whilst they might like everybody to be able to afford a house, actions which cause house prices to drop will upset a lot of voters, not just those who go into negative equity either. That's why Osbourne has introduced that stupid government backed mortgage guarantee - to allow people to buy houses they can't really afford with the public taking some of the risk. It would be far better from a housing people point of view to put a time limit on the planning applications to force the builders to build new houses in a timely manner and accept that the resulting price decreases will cause some people will temporarily have less equity in their homes.

[WallBuilder]

I think there are over a dozen area's earmarked in Sheffield for housing development and work has already started near Norfolk park building a range of houses. The problem about lack of suitable housing to buy is aggravated by the more well off types deciding to buy a second home or holiday home usually on the coast or out in the countryside meaning that the locals struggle to get a look in. The other issue is the buy to let idea which again takes houses out or just the property landlords who can pay cash for a property and then rent it out..

A house building company are going to be more interested in an area where they can build several properties rather than just one or two and large bits of suitable land aren't that easy to come across without help from councils and planning boards.

[Cyclone]

Thanks,

You said “ There are many people with a vested interests including builder, ..etc”, can you explain how a builder would benefit from lack of building

 

She did that already

 

building enough houses for everyone could cause prices to fall which would be really bad for the people with an interest in keeping them high.

 

Builders have an interest in selling houses at a high price. 'Flooding' the market would depress that price and isn't in their interest.

 

Of course competition should override that, because no individual builder can flood the market, but by building more houses they can realise more profit more quickly. I don't know why that isn't happening.

 

---------- Post added 22-08-2013 at 13:01 ----------

 

They'll build eventually but lots of new houses coming onto the market in a short time will cause prices to drop so they'll make less money. Better for the builders/estate agents/banks/etc. if they are drip fed into the market slowly to maintain the high prices.

 

With politicians the problem is slightly different. Whilst they might like everybody to be able to afford a house, actions which cause house prices to drop will upset a lot of voters, not just those who go into negative equity either. That's why Osbourne has introduced that stupid government backed mortgage guarantee - to allow people to buy houses they can't really afford with the public taking some of the risk. It would be far better from a housing people point of view to put a time limit on the planning applications to force the builders to build new houses in a timely manner and accept that the resulting price decreases will cause some people will temporarily have less equity in their homes.

 

3 years is the standard limit. Maybe it should be reduced for any 'multi dwelling' permission.

 

---------- Post added 22-08-2013 at 13:02 ----------

 

I think there are over a dozen area's earmarked in Sheffield for housing development and work has already started near Norfolk park building a range of houses. The problem about lack of suitable housing to buy is aggravated by the more well off types deciding to buy a second home or holiday home usually on the coast or out in the countryside meaning that the locals struggle to get a look in.

Is that an issue here?

Is it a real issue anywhere outside cornwall or the lakes? What sort of numbers of 2nd home ownership are there in different localities?

The other issue is the buy to let idea which again takes houses out or just the property landlords who can pay cash for a property and then rent it out..

A house building company are going to be more interested in an area where they can build several properties rather than just one or two and large bits of suitable land aren't that easy to come across without help from councils and planning boards.

The point of the link in the OP is that there are 400k approved houses that are currently not being built.

[erebus]

Well than yourself lucky for all the LEGAL immigration, only a few million, but every little helps, to put pressure on the system. Possibly a detail overlooked.

 

THe production of wealth, and not the service industries that spread it, but real manufacturing, where value is added, excluding the military industrial growth thanks to the wars, and wars on terror.

 

House prices rising, as the government take the 11.5 billion from those undeserving people with surplus bedrooms, and plonks it into the hands of building speculators, where like magic prices rise, as do rents.

 

THose that had the surplus bedrooms, dont vote TORY, and in 2 years, with house prices rising who might benefit? Labout of course!!!???? Or not! Anyway the builders and associated trades that feed the industry, are in a position to fund the parties that patronise them. So the financial merry-go-round, just might turn up trumps.

#

Of course none of this could possibly have any merit, so its an opinion.

[Obelix]

Let me start by this very general impression. For several weeks I have been trying to find out if the housing market has been encouraged to grow so, firstly, it will provide homes for those who need it ( I think there is actually more demand than supply ), and secondly, I feel if you help the housing market then you automatically help the overall economy, something we definitely need.

 

Luckily today the BBC published an article titled “ Planned homes remaining unbuilt, say local councils”

Almost 400,000 homes in England have been given planning permission but have yet to be built, research suggests.

http://www.bbc.co.uk/news/uk-england-23790071

 

Could I ask if we could, please, leave politics on one side and focus only on the facts and the problems and the best way to solve them

May I start by saying if you believe like I do that there is demand for new houses that has not been met, what is in your opinion the reason?

 

Lack of capital for the builders to actually hire the men, buy the materials and get building them? We have had a credit issue of course and a lot of the big name builders have had issues.

 

I mean here there was a planning application put in and granted for eighty houses. They are building six at the moment, and wont finish them all until the end of 2014. That's going to show up as 72 houses with planning and not built on that sort of thing, but they will get built, just slowly as they don't want to be left with unsold houses for very long.

[angos]

 

Is that an issue here?

Is it a real issue anywhere outside cornwall or the lakes? What sort of numbers of 2nd home ownership are there in different localities?

 

Yes because the issue spreads, locals that would have bought houses in Cornwall will buy houses somewhere else because of second home ownership.

Each time someone is priced out of their own area they will move to a more affordable area, this increases demand in that areas so prices go up which forces people from that area to move to a more affordable areas, the North is generally the cheapest area so it generally spreads Northward and ultimately affects everyone.