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Britain is no longer well housed - Pt 1 The Problem

 

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Current Housing cost levels; in much of the UK; are a Disadvantage to our whole economy.
 
UK Housing often costs far more than the underlying costs of house construction (that is the labour, materials and basic land cost)
By comparison, Housing in most of the USA usually only costs the underlying direct construction plus land priced at a faming/utility rate (so: you would pay about £150k for a  4 bedroom family house with plenty of living space)
 
As a result of this situation, UK wage and salary costs have been driven up by the need for staff to earn enough to enable them to pay for their inflatedly priced housing.

This situation makes much of the UK uncompetitive compared to most of the rest of the World for any manufacturing or services that could be undertaken cross-border (such as programming, design) - unless we have a very strong quality or design advantage.

 

The Root Cause is that Housing Demand is greater than Housing Supply….. We have not built enough new homes over recent years, recent decades.
 
A careful cautious approach would have to be taken to dealing with the underlying causes; but the six principal ones are these:
 
Green Belt protection; valuable though it certainly is;  has been given more credence than family housing needs
 
Many large house development and building concerns have 'sat on' hundreds of thousands of approved planning consents to maintain and/or drive up prices (…….because doing this causes housing supply to fall even further behind housing demand).
 
Foreign interests are allowed; and encouraged; to purchase UK housing assets; often simply for investment purposes.
 
UK Councils have been seriously discouraged from operating Council House schemes.
 
Right-to-buy' rights; together with UK Treasury proceed grabs; have reduced housing stocks.
 
A wide-spread belief that increasing house prices are good for us. 
    They are not if an ever-growing proportion of the population cannot find anywhere decent to live.
    or if an ever growing proportion of our housing stock is owned by foreign landlords.
    Taking second mortgages - based on increased house values - in order to buy fashionable tat from the Far East and posh car badges was never a very sensible idea.
    But…. We do need to be very careful not to endanger the value of existing housing on the open market - so as not to damage home owners or their mortgage lenders

 

Should the next Labour Government tackle all this head-on?

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