Thursday, June 07, 2007

10 times the price, G8, and air-guitar.

So the National Housing and Planning Advice Unit set up by the government is warning that house prices might increase to 10 times you can read the full report on the NHPAU website oops no silly me that's for recruiting the full report is available um hold on... ah got you Affordability Report, nice that all the news sites linked to it <cough>

It's only 25 pages long and not a bad read. Some nice graphs that pretty much show what I said back in November - wages are static and house prices are soaring.

So a lot of people can't get onto the housing ladder. They can't live near where they work (as a side-effect this puts a burden on the traffic system). They need to borrow from friends and family to even put down a deposit before even getting to the mortgage. Money is ringfenced for loan repayments leaving less to be re-injected back into the economy (money from loans going back to banks to be paid out as loans to be paid to banks...). The economy slows, jobs are lost and some people now find themselves in serious trouble.

So what's the problem. Buy-to let mortgages have increased by 750% in 7 years from 44,000 to 330, 000. People who already own their own homes see owning another as an investment. While it could be felt that this opens a new renting arrangement it does take a property of the market and the new owners are still looking to make their money back, that's the mortgage plus.

Not enough new houses being built? Blame planning regulations; in fact -

The house building industry is keen to see targets for more houses to be built, and keen to see the relaxation of planning constraints that prevent this.
Yeah I bet they are. Here's a neat little quote about what the housing objectives should be -
A mix of housing, both market and affordable, particularly in terms of tenure and price, to support a wide variety of households in all areas, both urban and rural.
"Both market and affordable" what they can't be the same? Why should we have to artificially lower the price of a house to below its market value? If you build more houses, increase taxes on second homes (including buy-to-rents) then won't the market price start to decline in response?

Oops sorry my mistake as I said in November we don't want prices to fall; people would be stuck with mortgage repayments on a loan that's higher then the current value of their house and we know what happened last time and that was from a much shorter drop to the 'ground'. Nah better we massage the prices of a few homes for 'key' workers or trot out schemes like shared ownership that I've already discussed
. Maintain the status quo at all costs.

So the G8 got a quick mention this morning on both BBC and GMTV, as per usual it's a case of G7+1-who-wants-everyone-to-do-things-their-way; no prizes to guessing the identity of the 1. The protesters got almost an entire 5 seconds of coverage, with only one channel mentioning the German police using water cannons on these peacefully gathered demonstrators. Head over to Indymedia for their reports.

So again according to the BBC air-guitar has "burst onto the scene" and "gone international". Yep it's so new they're only holding both the 12th annual UK Championships and the 12th annual World Championships in Finland. Ah Webster's "burst" - to gain attention in the United States; "international" - something that occurs in Europe and the United States ;-)