The economy, the housing market, and the truth

[Ela James]

Who is in this monopoly?

It just feels like there is one

 

Anyhow, here is a relevant article “ Home ownership: how the property dream turned into a nightmare”, by Faisal Islam, Channel 4 News' economics correspondent, http://www.theguardian.com/books/2013/aug/18/default-line-extract-faisal-islam-housing

[lily may]

They could build decent sized houses with gardens big enough for families and have just a few clusters in different areas of the town. Plenty of green space and a children's park. small supermarkets and individual specialist shops (not the tacky cheap ones) encourage cafes to remain open in the evenings to forge a community. In Europe many towns have squares for locals to sit and chat and rarely is there big shops except in major cities. We are never going to attract big stores to Sheffield centre so we need to think outside the box and use the centre for housing instead of the green belt

[Rupert_Baehr]

...

Nothing exploitative about it, it's supply and demand.

Interesting that you mention Northern Europe, we have by far the highest level of home ownership, yet they seem to do just fine with long term stable rents.

 

Perhaps there's a reason for that?

 

I rented a house in the UK to a man who:

 

Did significant damage

Failed to pay his council tax

Removed items from the premises

and finally, 'did a runner' owing me quite a lot of money.

 

The Police weren't interested. I was told 'If you want to recover the money, you're on your own. We're not interested. - and if you act outside the law in recovering the money, we'll prosecute you! (But we will ignore the thefts you've reported. - We're far too busy to deal with 'minor theft')'

 

The council seemed to think I might like to assume responsibility for the unpaid council tax (it didn't take me too long to dissuade them from that daft idea .)

 

I sold the house. - One more property off the rental market.

 

On average, I'm asked twice a month whether I would like to rent out this house. I use it for 5 months of the year, but otherwise, I would have no problems in renting it out - and no problems in getting a good tenant, either.

 

The rent is set (I'm not sure who sets it, but there is a 'rent per sq metre' for every town, village and city.)

 

As a landlord, there is a long list of requirements I would have to comply with. The tenant also has a long list of requirements. If either of us was to default, we would be in trouble!

 

The Police here are interested in petty crime and they would track down a 'runner'!

 

People are willing to rent out houses here and others are prepared to rent them, because the rules work both ways and they are enforced.

[chem1st]

An average wage at what point in their life? It's not a single fixed value from the age of 18 through to 65 you know...

 

And should that be a single person? Or a couple?

 

Quite - but why should a person or couple on average wage have to devote more than average salary to buy the average house.

 

Just using two average values doesn't mean that they should be related. Has it ever been possible to buy the average priced home on the average national salary?

 

It used to be possible to legally build your own dwelling in a day in the UK 525 years ago upon common land common to all citizens of the UK and then take ownership of it.

 

One could take ownership of one's own house for less than 1/300th of one's annual salary, if one was able.

 

We shouldn't really be measuring housing costs based upon wages, without first taking into account the amount of labour required to produce them. And with technological progression, house prices should actually be falling. Like consumer electronics do.

 

The oft trotted out excuse is that, 'they aren't making any more land'. Which may be true, but it is essentially irrelevant when we use so little land for building.

However, we aren't making any more physical resources such as copper, so why do not consumer electronics rise is value much like houses?

 

Perhaps because of very large injustices in the tax system and the subjection of one to the forces of capitalism and the forces of monopoly/cartelisation of t'other...

 

There might only be a limited amount of apples in the market at one point in time, but a person or even a couple need not spend the entirety of the annual wages upon their fair share of apples.

However, they could potentially be forced to if the market was rigged, and apples were essential for a minimum standard of life.

 

Let us not forget that even the apple market is rigged. If fellow posters on here wished to grow their own apples, they would soon find a stumbling block... Apples are not to be grown by the lower classes, they are the preserve of the rich with estates, and the lower echelons of society are doomed to working on the estates planting, nurturing and picking, freezing and packing apples.

 

Earlier on this year some fellow UK workers were killed on such an estate...

 

Hampshire Constabulary and the Health and Safety Executive (HSE) have launched a joint investigation into the deaths which are being treated as “unexplained”.

Blackmoor Estate, which was established in the 1920s, has a long-standing reputation for growing both traditional and new varieties of English apples, pears, plums which are also used to produce cider and juices.

It is owned by the fourth Earl of Selborne, 72, who is a member of the Conservative party and entered the House of Lords in 1971, becoming a hereditary peer in 1999.

Staff on his country estate, where the fruit is grown, stored, graded and packed, were last night said to be distraught over the tragedy.

Lord Selborne’s son, William Wolmer, Managing Director of Blackmoor Estate Limited, said everyone was “absolutely devastated” by the deaths.

He said in a statement: ‘This is absolutely devastating for our tightknit community and our thoughts are with their loved ones.

‘The cause of this tragic incident is being investigated and the estate is co-operating fully with the authorities.’

 

Read more: http://www.dailymail.co.uk/news/article-2281601/Two-fruit-packers-dead-Lord-Selbornes-country-estate-overcome-fumes.html#ixzz2d1oF7Rcr

 

If these people had the freedom to grow their own apples, I doubt they would died in such a tragedy, as they would have greater concern for their health and safety, rather than profit.

We see time and time again, workers die in such tragic circumstances, but never is the root of the problem tackled. The root is the manipulation, and control exerted by certain people over others, via land. Be they mine owners, farm owners, landlords with tenant farmers, landlords with people lacking property rights with respect to their own shelter, or the provision of it in the first place.

 

Property prices and average wages, combined with build costs, can then in turn be used to quantify not how much a house should cost, but instead, how much workers are being exploited by their landlord masters.

 

---------- Post added 26-08-2013 at 01:10 ----------

 

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?

 

400k plots is a pitiful number.

 

There ought to be many more plots out there with permission. We should be building 400k+ houses per year. We should be allowing builders to plan in advance their building. We should in turn approve enough planning permission to have sufficient building over the next 5 years.

 

We need 2 million plots with planning permission out there, then perhaps 400 000 houses might be built in a year. With just 400 000 plots out there, the builders are understandably slowing down their building, in order to ensure they don't use all their approved plots and go bust due to an inability to build in the first place.

 

I'm not in favour of taxing the plots with planning permission either. Instead we need to tax all land values.

 

The man who waits for agricultural land to increase in price by gaining PP, makes far more than the one who waits for land with PP to increase in price, after he pays well over the odds for land with PP due to artificial scarcity of land with PP.

 

Thus a family can be rich beyond it's wildest dreams, by drib drabbing land out to the plebs via the builders (often companies that they own - and so they can also manipulate the value of land with PP and in turn price out competing builders).

[Ela James]

Housing is the only basic human need for which rapid price rises are met with celebration rather than protest.

[ivanava]

Housing is the only basic human need for which rapid price rises are met with celebration rather than protest.

 

That might be because the land under the house will last a very long time and can be passed onto your offspring which gives them an advantage over those people that don't own land. Just about everything else that we need and have to buy doesn't last very long, so needs replacing frequently.

Look at the other long lasting assets that people own and you will witness celebration when they increase in value, people will complain when the consumables bought frequently increase in price.

[Uptowngirl]

I think some folk are confusing houses with tents. You decide to stick up a tent in your garden and 20 minutes later there it is.

 

Putting up houses takes a bit longer. A developer buys 20 hectares of land and applies for planning to build 200 houses. Then they start with architects, raising finance, planning drains, water mains, roads, electricity & gas. Afterwards they might build a few show houses to test the market. It takes years. But all along there is a plot of land with planning permission and no houses. It sells papers.

 

We have a plot of land alongside the house with planning permission for 2 houses. We don't want to build them, but it increases the value of the land should we decide to sell and move on.

 

There are undoubtably many housing developments on hold for lack of cash or because it is uneconomic to build, but there are many more where the reason that homes haven't been built is down to the time it takes to plan and build them.

[muddycoffee]

There has been some very interesting points, especially on the first page of this thread.

My own point is that I think that building a new residential or commercial building is a big risk for a builder, especially a small family firm or even an up and coming regional one.

 

I know several small local builders who have gone out of business due to not selling a newly built building quickly enough.

And we have all heard about Velocity, and their half built tower and several other abandoned projects.

 

It seems to me that expecting builders to build lots of housing too quickly is counterproductive, it appears to be more sustainable to the building trade to allow them to build them over a series of years.

[Uptowngirl]

There has been some very interesting points, especially on the first page of this thread.

My own point is that I think that building a new residential or commercial building is a big risk for a builder, especially a small family firm or even an up and coming regional one.

 

I know several small local builders who have gone out of business due to not selling a newly built building quickly enough.

And we have all heard about Velocity, and their half built tower and several other abandoned projects.

 

It seems to me that expecting builders to build lots of housing too quickly is counterproductive, it appears to be more sustainable to the building trade to allow them to build them over a series of years.

 

 

Plus land is the most important commodity that a building company can own. They buy when a suitable plot is available not when they have resources in place to start building. So if a company is already fully committed to a project and another plot comes available they will buy it to guarantee work several years down the line.

[Staunton]

The volume developers contributed over £half a million to the tories around the time of the general election - I wonder if this might possibly be a factor?

 

Time to wake up!