They'll all be communists when they grow up. (Photo by Dylan Martinez - WPA Pool/Getty Images)
Harry, a 32-year-old Good Middle Class Graduate from a Good Middle Class Family™ looks up from his phone. His eyes move across the cramped rental flat to Fiona, his girlfriend of five years. He’s been thinking about starting a family for a while.
Later that evening, he tells her: “I’ve done some maths — we can just about afford to buy a gardenless 1.5 bed flat in Catford and have a baby, if we reduce our food budget.” And they’re the lucky ones. And yet, is that all his country has to offer them? Britain’s answer to anyone who isn’t a home-owning pensioner today is, unfortunately, yes. The formerly normal aspiration to settle and start a family is out of reach for swathes of young people. A fundamental compact between conservative principles, and the party that is supposed to represent them, has been broken.
The next leader of the Conservative Party faces an economic emergency with few obvious solutions. Public finances remain in a dire state following an almost continuous stream of crises. The Office for Budget Responsibility (OBR) estimates that the government has already spent as much as it did during the Financial Crash to support households through the current squeeze on living standards. House prices are a national disgrace, far exceeding historical trends on affordability and requiring decades of saving for average couples to even afford a deposit for a first home. Homeownership among the young has dwindled.
Britain tends to think of itself as an equal partner to countries such as France, the Netherlands and Germany in terms of incomes and living standards. This is a collective fantasy, which hasn’t been true for well over a decade. The reality shouldn’t be shocking, yet it remains so: Britain’s incomes and living standards have fallen far behind what were its peer nations only 15 years ago. “Across European countries, only households in Greece and Cyprus saw a worse performance between 2007 and 2018 than the UK,” found the Resolution Foundation. On its third consecutive Tory prime minister, and about to select its fourth, Britain isn’t working.
Does this seem like the time for a middle of the road party leadership candidate offering more of the same, a contest in which candidates simply take turns to outbid each other with Boomer-pleasing tax cuts? Or does a radical programme with a fresh-faced advocate need to step forward? The Tory party no longer has the theatrics of Brexit or a disruptive global pandemic to distract from these systemic, structural failings. The tide has gone out, the party isn’t wearing any knickers, and nobody is impressed by what there is to see.
Because the reality is that Britain’s national religion is no longer Anglican Christianity. It isn’t even the NHS. It is Pensionerism. Britain is a care home with a navy. And as the Baby Boomer cohort of voters ages, it is vital for the party’s long-term survival, not to mention morally just, for the party to begin mending the structural underpinnings of society that enable people to establish themselves and build families.
Brexit aside, if British conservatism is defined by anything, it is its reverence for community and continuity over radicalism and state interventionism. Asset ownership is vital for the maintenance of these values — increasing the country’s housing stock is a means to a conservative end. People who own houses invest in them for the long run and want them protected. These values express themselves in everything from taking care of a front garden, seeing it as a community as much as a personal asset, to favouring low levels of asset taxation on something “earned”.
Graduates face a marginal tax rate of at least 50%. They are expected by Bank of England governor Andrew Bailey to exercise restraint when looking for pay rises, even in the face of nearly two decades of pay stagnation. Family homes are completely out of their reach. Ask yourself, how does this look compared to the comfort of homeownership and the 10% growth in the state pension, under the triple-lock policy, that shields pensioners from the same fate? Are we really all in this together?
Yet all attempts to reform this growth-killing inequity end in failure, such is the strength of the homeowner-pensioner lobby. Despite free enterprise fitting hand-in-glove with Conservative ideological orthodoxy, housing remains a market throttled by the state, with severe supply restriction enforced via irreformable planning forcing prices up. This has deleterious effects across swathes of public policy, from living standards, to fertility, to climate change.
Is it any surprise that productivity and post-housing cost income growth doesn’t exist in a market where any wage rises go straight to existing landowners in higher rents and prices, rather than resulting in an increased supply of houses? If increases in productivity don’t raise living standards, where is the incentive to increase productivity? Scaling this huge challenge must be the immediate, urgent priority of the next Conservative leader.
It’s been done before — look back to Margaret Thatcher’s reforming governments. But while Thatcher wielded the sword and cut through the Gordian knot of Britain’s public sector businesses and unions in the Eighties, she did this with the tailwinds of North Sea oil and gas revenues and entering government afresh, not 12 years into Conservative rule.
Thatcher could even be said to have redistributed — a word we associate solely with the Left of politics — housing towards council housing tenants. She recognised that without homeownership, the facts of life ceased to be conservative. Nobody could imagine a Conservative government today redistributing housing wealth towards the young, regardless that much of it was ‘earned’ through planning restriction and loose monetary policy. It seems unlikely that any of today’s leadership candidates would — or could — wield such a sword as she did.
There is an obvious solution to all these structural problems: growth.
It is encouraging to see Sajid Javid identify growth as one of the key planks of his campaign for leader and for him to state that housing is a supply side issue, but less so to see Jeremy Hunt reflexively spouting a ludicrous unfunded promise to “cut all taxes”. Yet another demand-side reform. But Hunt’s reasoning is tragically logical: the next leader will not win the votes of members by attacking the party’s own base — which has become substantially older in recent years — over the lack of planning reform, the biggest cause of Britain’s anaemic growth record. What is required therefore is a dose of the dryly titled ‘policy entrepreneurialism’.
To win — and win properly, not just squeak into office just to prepare for election defeat in two years’ time — the next leader must shout from the rooftops about growth, while investing in clever innovative policy solutions. Seek softer community buy-in with policies that could encourage development while benefiting residents like Street Votes. Be radical. Call for the permanent abolition of Stamp Duty. The Treasury will fight you, but a universally-hated tax that increases market friction by preventing the elderly moving out of large family homes is a politically feasible housing policy reform. There’s £3.31bn in annual economic growth up for grabs!
Build more houses, but be smart about it. Building is impossible in Chesham and Amersham? You’re a Conservative government with sky high prices in Labour-dominated, youthful cities! Ignore Chesham and Amersham. Build in the cities with the strongest price signals and if current residents don’t like it, let them vote even more Labour, or move away. Enabling growth in the productive cities will give you tax revenues to spend on public services, or enable you to cut taxes responsibly from their current postwar high.
The UK has some of the highest childcare costs in Europe according to the OECD. The cost of subsidising childcare to a level closer to the European average could bring more women into the labour force, thereby increasing economic growth while solving sex-based social inequality. Isn’t this win-win?
But already in this contest we see Suella Braverman open her candidacy with cheap promises to leave the European Court of Human Rights. This kind of policymaking would neatly follow on from the return of voluntary imperial measurements, and the probably unworkable Rwanda refugee policy. Meanwhile Sajid Javid, Penny Mordaunt and Liz Truss have all pledged to lower fuel taxes, an astonishingly regressive proposal that benefits the richest first while ignoring the pressing need for climate action. The party must learn: throwing red meat to the crowd doesn’t put red meat on the table.
Without Brexit to focus on, the Government has lost its sense of purpose. The next leader must be a strategist, cerebral, and yet still a salesman. Someone who recognises that there’s more to winning than winning itself, and declinist managerialism — that a far greater prize is changing peoples’ lives and your country, for the better.
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SubscribeYou completely ignore demand. Our population is constantly increasing due to mass immigration, driving up house and accommodation prices whilst simultaneously depressing wages. We also have insufficient food production, precluding further loss of agricultural land for building housing and infrastructure, and insufficient energy production to provide for this ever-expanding population.
Suella Braverman’s plan to leave the ECHR is one that all of the Tory leadership candidates should intend so that the tens of thousands of illegal migrants every year can be deported. Legal immigration, too, needs to be drastically cut, at least for a few years until a new equilibrium is reached. 1.15 million visas were issued last year – it’s utterly unsustainable.
Agree – it does seem a fairly stark oversight.
However, I’d be weary of placing too much faith in any potential candidate who only focuses on sorting immigration out for three reasons:
a) We’ve heard it before
b) It’s a lazy low hanging fruit policy, and very likely calculated to be an easy replacement for any other substative policies or general strategy.
c) it won’t alone do much at all to improve the inflation, energy and cost of living crisis.
If it were really low-hanging fruit, something would have been done !
They always ignore demand.
The premise of the article is sound. The opinions offered are not. Lowering fuel taxes is not “regressive” and does not benefit the rich over the poor. What utter nonsense. It’s almost as if this is only there to shoe-horn in a green narrative. It is net zero that is regressive for the less well off. Fact.
Why do the immigrants come across Europe and a risky channel crossing? Because the British are addicted to socialism and living off government handouts. This is what the immigrants come for. To stop immigration we have to take responsivity for ourselves and I cannot see any sign of that happening.
Most immigrants come to Britain because they speak English, not French or German, and above all have family here. If you paid any attention to Conservative policy, which you clearly don’t, you will know they have closed ALL LEGAL ROUTES. In 2016 Therese May made and agreement with Alf Dubs, a Kindertransport refugee, to allow 3,500 child refugees into the UK. They allowed in 359. Every single piece of social research for the last 40 years show that ‘immigrants’ are less likely to use any state benefits or medical services. You are ignorant.
How are these immigrants driving house price growth when middle class working young can’t to buy?
I just can’t compute how someone arriving from abroad is leaping ahead of the domestic citizens?
net zero and green taxes effectively tempered spending in the good times but now things are squeezed they have driven inflation by putting up base costs that inflate wholesale costs that drive retail costs to us consumers, it’s not a difficult concept to comprehend. Remove (even temporarily) the unnecessary taxes that drive base costs and inflation is reduced.
No mention of immigration and its pressure on house prices makes this otherwise excellent essay worthless. If boomers had bothered to police the country’s borders the south east would have millions less people living in it.
Was Tony Blair a boomer?
“an astonishingly regressive proposal that benefits the richest first while ignoring the pressing need for climate Action,”
Every article I read that includes that garbage loses my interest. I have concluded that any journalist who uses such a job killing, economy stifling, and government power grabbing phrase deserves the economy he decries. When America uses it’s rich resources it prospers, why not England? When we shut off those resources in the name of the Climate Scam, we lose our way and that is more regressive than any tax.
Climate is only a problem for the white middle classes.
I know people in some African countries who’d disagree with you. Try telling a small farmer whose water supply has dried up that it’s not a problem.
Does the small farmer in question really think it’s climate change? Or does he understand that it is almost certainly down to changing land-use patterns of the same kind that western farmers had to solve hundreds of years ago for the same reasons?
It is depressing to read such nonsense. Climate change is the issue of our time, and the smart countries are investing in green technology (where millions of possible jobs lie) at a rate of knots, having noticed how dependence on the dirty old forms of energy leave them tied over a Russian barrel. All across Europe people are wilting in 42 degree heat as I write this. It’s time people accepted the truth of climate change and stopped resorting to flat-earth denial and the dumb mantra that all growth is good growth, all profit acceptable. That kind of thinking led to filthy air and water, hideous hedge-less farms and animals penned in vast prisons while we exploit them for their milk and eggs. Wake up.
Rubbish. Climate change is a politically-synthesised issue designed to pass huge amounts of power to the political class at the expense of everyone else’s liberty. The facts have proved that whatever the causes of the present modest changes in climate may be, those changes do not represent immediate dangers and most certainly do not justify the colossal confiscations of wealth required to fund the intended policy responses.
In 2020, the UK actual individual consumption (AIC) per head was well above the EU27 average.
AIC is a better indicator of material welfare of households that GDP per capital and is derived from purchasing power parities, which equalise the purchasing power of different currencies by eliminating the differences in price levels between countries.
Taking the EU average as 100, Switzerland was 125, Germany was 123, the UK was 116, France was 109, Italy was 100 and Ireland was 95. The UK has major issues with housing supply, educational attainment, and regional inequality. But the relative picture is not as bleak as is frequently depicted.
Meanwhile, the prize for the most simplistic statement on a complicated issue must go to the following: “The cost of subsidising childcare to a level closer to the European average could bring more women into the labour force, thereby increasing economic growth while solving sex-based social inequality. Isn’t this win-win?”
Re: you last paragraph – absolutely! Sheer economic illiteracy, which seemingly increased as the article ‘progressed’…
What would you do about childcare? Let’s have your solution, instead of ad hominen puffery
The reason it’s so expensive is the regulatory requirements around it that effectively overstaff the service. The one way to make this problem even worse is to then subsidise the system with tax money taken from elsewhere. The solution is to fix the broken regulatory system, not give it more money.
But of course that’s impossible because as soon as anyone tries that, they’ll be labelled a child-murderer or some other fatuous accusation. I was accused of the same motive only yesterday for questioning why Park Lane should have its speed limit reduced to 20mph. The cretinous stupidity required for someone to envisage Park Lane as a kiddies playground for the purposes of winning an argument boggles the mind, but it does handily explain why almost every new law, no matter how stupid and destructive, is permanent.
This article is wrong to assume a few things, but absolutely correct in this statement:
“If increases in productivity don’t raise living standards, where is the incentive to increase productivity? Scaling this huge challenge must be the immediate, urgent priority of the next Conservative leader”
I’m a hard working engineer and physicist, I’m years away from a deposit on a house and I earn very good money
. I chose to have a family because nothing was going to stop me having one when I decided to, but this endlessly failing economy, this directionless government and this British culture is completely alien to any wide spread conservative Principles. And that’s not because the young don’t work but because many entitled and successful people, especially older ones don’t stick to the principles of a fair community or a state, and have priced out our future for their comfort and because of their great pride in themselves. Covid lockdowns lncluded.
Normal human beings don’t hoard wealth in houses, they build up and support each other and thus create community through homes, education, jobs and institutions. It’s so fundamental but sadly we are wonks away from it. We knew it after WWII because people looked the end of the world square in the eye, but after 70 years of prosperity, no one over a certain age can imagine hardship, and now it’s on our door for a the very foreseeable future.
But to be true, It will forever be this case unless we can reignite the fear of something or the longing for a new world. Perhaps Putin will provide the necessary dilemma.
What’s a good salary?
£50k?
There’s a reasonable probability that Harry and Fiona consider it terribly cool to be in favour of open borders or, at the very least, refuse to discuss immigration.
Too few homes is only half of the story.
The average wage in the UK is now £615 per week (£32k per year).
If Harry and Fiona both work they could afford a (3x earnings) £200k property.
There are 1500 three-bed properties on sale for £200k or less in Lancashire on Rightmove today.
There are 12000 jobs paying over £30k in Lancashire advertised on Indeed.com today.
That is before we talk about remote working options – live in Lancashire but earn London wages. If they currently work from home down south they could do the same job up north.
They should get married, stop moaning and get moving.
Harry and Fiona probably grew up in the South East and have family, community and friends there – they feel it is their home – are you suggesting the answer to their problems is to become an economic migrant?
Cake and eat it stuff
On the other side, they may also be part of the decades long exodus/brain drain from provincial regions that follows the pattern of a residential university course away from home followed by working in an overcrowded city because that’s where jobs exist. They’re already economic migrants.
Exactly. They might want to move back to their (cheaper) home town.
Considered normal in the US to move across the country to find work or just a more affordable/ satisfying lifestyle. It is also becoming increasingly common here – I had loads of my team leave London – for places including Lancaster and Carlisle – during Covid.
No doubt Harry and Fiona want a three bedroom mansion flat in Holland Park but you can’t have Champagne tastes if you only have beer money.
When I left home it was a series of rented rooms, shared bathrooms and a pay as you go meter. First married home was a two bedroomed flat over a butcher’s shop. Baby came, no washing machine. Second baby and we were pushed to move and we bought a wreck with no electricity, heating, floors or plaster. I am amazed at the expectations of the young nowadays.
This all sounds very familiar to me.
1) I suspect the jobs they do in London do not pay the same as Lancashire. Even in the Home Counties, the pay gap between them and London for the same sort of job is very noticeable. This will also mean that to earn £32k in Lancashire, you likely require more experience than someone typically has in their early 30’s.
2) While remote working has increased, it is mostly hybrid where employees will go to the office 2-3 days per week. Any savings on housing will likely be swallowed by travel and possibly other alternative accommodation costs as a result of travelling down to Lancashire.
3) And maybe they should cut down on the £10.99 per month Netflix subscription and the £1.00 Avocado on toast. That’ll have them a deposit in a jiffy I’m sure…
£1.00 for avocado on toast? Sounds good value to me! ;0)
1. There is plenty of well paid work in Lancashire – just run the search on Indeed or any job site.
2. Many jobs on the same site are advertised as 100% remote.
3. Sure. Everyone has to when they start a family. My dad had two jobs until I was 10. Sacrifice is part of the deal.
Most parents now both work full time and still can’t afford it, that’s the difference. With a bit of hard work your parents could survive in just his labour
Both my husband and I had to work to afford a house as my entire salary went on repayments, and when inflation hit 17% part of his salary too.
1500 houses is a drop in the lake of demand. It will house 3000 people to begin with. Then what?
There are houses and flats in every county in England and many in the Home nations. But yes population growth needs to be monitored and throttled off if needs be by raising the earnings threshold on work visas.
there’s a good reason housing is cheap in Lancashire
And what is that?
Maybe once but remote working is changing things. House prices are rising in most of the provincial markets. Remote working and the expensiveness of the South are the reasons.
So you or your family have moved to or live in Lancashire for work then? Or would be willing to relocate there or anywhere else for work, tomorrow, if you had to? Do you have friends or a community that you belong to right now where you live, not in Lancashire perhaps? Do you have a aging father to take care of or a school that your kid/s goes to? Or wife have a job too she enjoys?
Your comment is so tone death that I assume the answers are all No. Or Yes just because you want to save face.
I’m from Lancashire.
Also I note you are an engineer. If you ever did want to make the move and get a better standard of life, you might not know that BAE Systems make fighter jets and nuclear submarines in Lancashire and they employ thousands of engineers. You could do a lot worse. I think you would be surprised with the sort of house you could afford. Schools are good, countryside beautiful and the towns are full of pubs and restaurants. Family down south? Train takes 2 hours from Preston to Euston. Good luck with your family.
Why would the young vote Tory? he asks… because they only have to look at the alternatives and see that they would make the difficult situation present now considerably worse, with borders even more open and flinging money about with no thought for tomorrow.
I had the nagging thought throughout the article: but migrants are coming here from France. Evidently Britain is better in their minds despite everything.
Sadly, for a long long time, many young people believe that despite all the evidence, Socialism works.
And why wouldn’t they? Millennials would have entered the workforce around the time of the credit crunch, so all they have ever known is stagnant wages, insecure gig economy employment, house prices climbing out of reach, record rents and many have taken on large student loans in a desperate attempt to avoid the most dead end jobs.
Now compare that to their grandparents time which was more socialist in nature in which many started their days in a council house with affordable rent, could leave school with nothing and find a job that allowed them to buy a family home and raise a family on a single wage.
If the current system is failing the young then they’re going to look for alternatives
Case rested. Thanks to those who posted below on this matter.
https://www.migrationwatchuk.org/briefing-paper/347
2014
Response to UCL paper on the fiscal effects of immigration to the UK30 December, 2014
Summary
Overall cost of migration
1. Between 1995 and 2011 the fiscal cost of migrants in the UK was at least £115 billion and possibly as much as £160 billion according to a report from the Centre for Research and Analysis of Migration headed by Professor Christian Dustmann at University College, London. The report found that migrants in the UK were a fiscal cost in every year examined.[1]
Contribution of ‘recent migrants’
2. The report claims that migrants who had arrived in the UK since 2000 had made positive contributions throughout the period from 2001 to 2011. This does not appear to be correct, the figures in the paper show that the contribution from these recent migrants was negative in each year after 2008.
Contribution of ‘recent A10 migrants’
3. The authors also highlighted a finding that between 2001 and 2011 recent migrants from Eastern Europe had made a net contribution of £5bn. While this correctly reports their most optimistic finding, their calculations in four alternative scenarios were all lower. One of these alone was enough to reduce the contribution to as little as £0.066bn – a sum within the margin of error of such calculations.
4. In addition, the very large fiscal cost of immigration overall is compounded by the cost of congestion and loss of amenity caused by our rapidly rising population.
What a ridiculous article, which starts by dividing the population into young people who cannot afford to buy a house and start a family and home owning pensioners.
There is no point in saying house prices are a national disgrace. They have increased because of cheap money, increased loans in proportion to salaries, and lack of supply. The lack of supply is because of profit made when land prices increase when classified for building and the objections to more and more development.
Living standards have fallen because of the lack of useful jobs and the creation of meaningless jobs to create the impression of high employment. We allowed our assets to be taken over by foreign companies. Britain is working, it isn’t doing anything useful and the profit we generate is going abroad,
The state has taken over from family support. It provides child care so that mother’s can go to meaningless jobs. it provides care homes for the elderly because their children have been brainwashed by the state from birth to believe it is not their responsibility to look after them. The elderly are living longer and in a poor state of health because of all the drugs they are on and probably could not be looked after at home anyway. This the what the NHS has done. It has destroyed the health of the country.
Thatcher may have helped some into home ownership but industry and jobs were lost in the north and Wales. This was because most of it was inefficient and badly managed. It was not viable and could not continue anyway. Thatcher did not have any real answer for replacing the lost jobs and that is still with us.
Here the answer is “growth”. Growth of what precisely and what about competition? We cannot have high wages and expect to sell goods and services when others are prepared to work for lower wages. It is also says building in the cities is the answer. Who in their right mind wants to bring up a family in an inner city, postage size apartment?
Change lives for the better – how many time do we hear that? All we have been doing for years is voting for a different slave master. Now is the time to cut the chains, forget reliance on the state and take responsibility for ourselves. None of the political parties will allow that to happen. They all want control over us.
I had thought that Substack sounded interesting – until I read this man’s article. If all the contributors are as vitreolic as this one then count me out. Possibly some interesting opinions but I couldn’t get past his nastiness. I do hope he doesn’t come to live near me. It wouldn’t be long before he graffitied my door with the word BOOMER. I apologise for being born at the wrong time and for owning my own house and I accept that this makes me selfish, greedy and grasping. Even worse, I have so far been blessed with good health which may mean I live for some time. I apologise as well for this.
However, I do hope so as this means I can continue to give every spare penny I have to my children which has helped them on the (albeit bottom) of the housing ladder and to give loving and unquestioning child care. Most of my friends have lived their lives this way.
By the way, good on yer Sharon. Wonderful and succinct. Funny how he avoided that topic completely.
I would hazard the number of Substackers are now in seven figures. All with different opinions.
Substack stands out as THE centre of Covid opposition.
To tar all on the evidence of one is beyond stupid.
Take care. It’s not good to be stupid in these times, they’ll do you lot first.
Pretty damning assessment of the situation, but I must say highly persuasive in its recommendations.
Growth over all else is certainly something I can wholeheartedly get behind; the foundational policy around which all else hinges. Its not only obvious that a half arsed suite of reflexive, shallow policies will do nothing other than win a leadership contest, but it will also as result, come general election time, likely allow Starmer to stroll into number 10 without ever having to generate any ideas of his own; continuing his effortless ascendancy built purely on Tory incompetence. For It seems very clear to me at least that without serious, innovative, growth focused (maybe even, dare I say, growth obssesed) policies, the deep problems the country faces will only get worse.
As the author alludes to, even with what little faith we can place in the Conservative’s ability or willingness to fight the various cultural battles, without a solid foundational change in economic direction these battles will certainly be lost once the general election is.
The one advantage the Conservatives have is the lack of economic ideas on the left, and a unwillingness or inability of them (the left) to talk of anything other than how money should be taxed and distributed – rarely if ever is any attention given to how wealth should actually be generated. Many Labour voters are also, in their religious like environmentalist mindset, suspicious of economic growth, any many will no doubt be turned off if Starmer starts talking of firing up the capitalist engine – even moreso if this neccesitates deviating in any way from the sacred ‘net zero’ targets.
The only problem that remains then is the immense amount of planning, intelligence, diligence, determination, PR, and foresight that it will take to drive along this dogged and absolutely all out commitment to growth and reform, and dispelling the lingering feeling that when there is such a crucial opportunity and need for a new approach – nothing ever seems to happen.
“You completely ignore demand. Our population is constantly increasing due to mass immigration, driving up house and accommodation prices whilst simultaneously depressing wages.”
You are wasting your breath. You are are challenging a tenet of the new religion: The belief in the rightness of an open border immigration policy.
Growth is what got us into this mess. It is the driver of capitalism, and the financial system. It needs growth to maintain profits and profits have been declining for decades. It is not a sustainable system. What we need is free, competitive trade and that means keeping governments away from business and their links and support for the global corporations.
This seems like a pretty reasonable summation of why younger people don’t vote Conservative. But I struggle to see why you think there is any more prospect of the next Tory leader adopting any of the policies that you advocate than there is of the current Labour leadership (which has far less excuse, given that it’s voters are much younger) doing so.
Incidentally, on the matter of housing supply, I hate to disabuse both you and the commenters but the reason that housing supply has not kept pace with demand has little to do with restrictive planning policy (at least at the aggregate level) and not a lot to do with immigration (at least of people – the inflow of money is a different matter). It has much more to do with the standard development model employed by developers, which all but prevents house builders from building homes if values aren’t rising. To ensure that they can keep building, developers are very careful to ensure that they do not build homes at a rate which would cause values to fall. This was the central finding of the Letwin Review of a few years ago. It was, largely, ignored.
The curious and counter-intuitive consequence of that, is that high house prices actually suppress supply instead of incentivising it because developers can only build the number of homes that the market can absorb with prices at their current level.
If that seems weird, than ask yourself this: is it easier to find buyers for houses that you want to sell at £400,000 each or £200,000 each?
Thus, if house prices are high, you can only build homes at the rate that you can find people who can afford £400,000. If you could build and sell them at £200,000 each, you could sell them much faster because there are far more people who could afford that price. So, if you want to build and sell more homes, you should reduce the price.
The problem with that is that, if you tried, to do so, you’d find that you were unable to buy any land to build the houses on. This is because the price of land depends on the value of the homes you build on it. So, if you want to cheap houses, that’s tough because the landowner will sell the site to someone who wants to build expensive houses instead.
There are ways to fix the problem but neither of the major parties have shown the slightest interest in those solutions – both of them largely ignored the Letwin Review and remained in their respective comfort zones of blaming the planning system (Tories) or blaming developers (Labour).
It is barely credible that the fate of this once great nation of nearly 70 million is soon to be decided by a Cohort of a mere 200,000 grumpy, moronic old farts such as my good self whose usual battle cry is “outraged of Tunbridge Wells “.
God help the young, they’re going to need him/her.
What is sex-based social inequality? Another manufactured “crisis” by the Government Is Our Daddy crowd? A woman who decides to have a child will need to make tough choices for the sake of that child. If she doesn’t want or can’t afford to leave her job to raise the child, the logical decision is not to have one until she can.
The same goes for married couples, but they have the advantage of one partner out working, one home raising, and combined families tied together who are the vital support team. That system has worked pretty well for thousands of years.
Good grief, government the world over is a colossal reeking pit of malevolence, corruption and incompetence. Who in their right mind would want it anywhere near their babies’ upbringing?
And does “What is sex-based social inequality” differ from “What is gender-based social inequality”
Inquiring minds, norl that…
“…need for climate action…”
It is green energy policies that are destroying the economy.
Climate action. Climate justice. Climate bollocks.
We finally get a taste of the glorious Summer of ’76 and we’re all going to fie of heat. How come CO2 is causing this? But not in ’76?
“Climate change” was the prompt for the handling of Covid. Terrify the nation and they’ll do your bidding
Shame the planet’s cooling for 7k years.
OKAY. Enough pensioner kicking. There are TWO MILLION of us living in poverty, and that number will rise exponentially as energy prices rocket.
The REAL pensioner problem is Public Sector pensions, which are gobbling up more and more of our taxes, and which we really cannot afford.
Blaming recipients of one of the WORST state pensions in Europe after a lifetime of work is bigoted and ignorant.
Got it?
A lot is missing here. How about the decline in medium wage jobs that don’t require a degree; the decline in education or training that would provide a young workforce able to do such jobs; two decades of importing labour to compete for any such jobs that still exist and the low wage jobs that replaced them. Low productivity is as much a problem of far to many people doing jobs that generate little, if any, tax revenue as anything else; there are too few net contributors.
In the town where I grew up in the North of England, the population has almost halved over the past half century as industries declined. Large areas of Victorian terraces, solid houses that would cost £500k in the prosperous South, have been levelled. Plenty of brownfield land, but you can’t build without jobs for young school leavers to do. Likewise, how do you build in cities that are already overcrowded?
The reason why we are falling behind Europe in our standard of living is twofold. First, because housing is ludicrously expensive – not because building costs are high but because land is. And land is expensive because the government and, lets face it, we the people have created a highly restricted pool of developable land. That is not difficult to sort out , though a lot of people will not be happy with cheaper housing – the banks and mortgage lenders in particular.
Second, we are grossly overtaxed. That has two effects; we have less net disposable income, and we have a lot of civil servants and similar being paid lots of taxpayers money for doing nothing productive. That is very easy to sort out….
Nothing new here. Heard it all before.
Why should the Tories help people who believe that girls have penises and the world is going to burn up in ten years? Idiots should not be pandered to.
Not all young people believe that! I don’t like it when Boomers are generalised, so please don’t generalise the young.
These “idiots” will be paying for your social care so you may not want to bit the hand that will feed you one day.
people like Mordaunt?
‘Growth’ is the answer… although it will make achieving anything like Net Zero that much harder. Perhaps, just perhaps, there are no easy answers.
It is difficult to know where to start. When you talk about housing and the cost you ignore the glaringly obvious.Thatcher forced councils to sell their housing stock at 30% BELOW MARKET VALUE. If Pakistan, Nigeria, or India had done this it would have been called corruption. When counils pleaded to be allowed to build new council housing with the sales revenue she refused: “That is socialistic.” In the same year, 1983, she was paying £5 BILLION a year for mortgage tax relief. That wasn’t socialistic. She then went on to abolish minimum building standards “as an impediment to the market.” So for 45 years Britain has seens the shoddiest housing buildings erected anywhere in the so called developed word.
Now 95% of former council houses are owned by private landlords renting out the properties to the people who would have originally been eligible in the first place at three times the rent they would have been charged. So the occupants cannot live there without Housing Benefit. Once you have HB you are on an ‘earnings taper’.
Let me explain: I became a single parent in 2004, me and my son were put in a homeless hostel where we were supposed to be for not more than one year. We were still there four ears later and my son developed panic attacks at the age of 6. The Council, Barnet, the most extreme right-wing in Europe, refused to house us. We didn’t have enough ‘points’, even though my son had been in care, and I had been diagnosed with clinical depression.
In 2008 I was offered a ‘private’ flat via the Paddington Housing Association, something to do with a Gordon Brown scheme where flats would be rented from private landlords. When I went to the flat, two bedrooms, top half of a house, tiny but palatial compared to the hostel, I asked the Housing Officer if it was long-term. “Absolutely.” We moved in.
My neighbour downstairs, who owned the freehold, asked me why I had moved in. I told her about spending 4 years in one room and how I had been told it was long-term. She immediately told me the previous tenant had been a drug addict and after 4 years of complaints had been forcibly removed and the lease was being ended in 3 months.
I was volcanically angry and called the housing officer in to a meeting. I made the fatal mistake of not having a witness with me. She sat in front of me and swore blind that the tenure was long-term. Six weeks later I got a notice to quit. I developed tinnitus from this the consultant said it was stress.
I complained to the Housing Ombudsman about my treatment by Paddington, and despite a sworn affidavit from my neighbour they refused ny complaint because the “Housing Officer: “Had no recollections of any conversations with me on length of tenure.” Ombudmen are supposed to use civil court judgements: “On the balance of probalbility.”
Eventually I came to an agreement with the landlord we would stay. The rent was £230 p.w. The council tax £25. My Housing Benefit was always £20 p.w. les than my rent and my council tax benefit £5 short. I had an ‘earnings taper’ of £71.80p per week. So I had to pay £25 weekly towards rent and council tax, and £38 for my weekly travel card, totalling £63. I was earning £10 p.h. So after my first hour I was earning £1.30 p.h. because I had an 87% marginal ‘tax’ liability. Who can you name who pays 87% tax? Four million of the poorest people did, now it’s ‘only’ 57%.
I came home from work on a Friday evening to find a letter from the Council saying my new award for rent was £230 p.w. I was exultant, another £20 p.w. in my hand. Saturday morning the landlord rang me and said he was increasing my rent to £250 p.w. There was a time that would have been illegal. But Thatcher said: “Property owners have the rights to do whatever they wish with them.”
If I had ben a scumbag and left my son in care for the 17 years I cared for him it would have cost the state over £1,000,000. My reward was to be kept in poverty by design and then blamed for my poverty.
What this idiot author does not understand, think about, or aknowledge, is that housing, built and provided by local councils, at affordable rents so people could work and save, and move on to home ownership, or simply live a humane life, was the bedrock of the ‘boomer’, social mobility years.
Private provision of housing will NEVER, EVER, EVER, meet needs. Think about it for a nanosecond. If they met demand there would be no market or ever increasing prices. Rent used to take 30% of income,now it is common for 55%-65% which meams everyone works to pay the landlord and can never save. WELL DONE MARGARET THATHCER. We have you to thank.
The horrifying thing is that most peope on this site regard Thatcher as a dabnerous leftie.
I suspect my post will not even be read of commented on. That would require thinking.
Why would the young — shown at the top of your piece — vote?
House ownership is key to Conservative support. Thatcher and Major understood that because they came from backgrounds where house ownership was marginal: some people rented and some owned. They saw how people changed with home ownership. The Bullingdon boys do not understand, because they have never had to worry about whether they could afford the mortgage.
Important to say: I have not been in Europe before. I live in Nigeria. But I follow the news.
As to starting a family, consider this: immigrants from my country in the UK, even those doing blue-collar work, start families with much less than the unmarried couple mentioned in this article. They usually produce more than two children. And the children and their parents don’t suffer from malnutrition. They go to school and, with time, join the British elite. Lesson: let the British learn from immigrants: let the British that want children reorder their family budgets.
On comparisons with France and Germany. More illegal immigrants from the global South prefer the UK to France. I don’t know about Germany. More highly educated or skilled French citizens (not only footballers) look for work in the UK than vice versa. (I’m told the reverse is the case with retirees.)If I’m right, does it not cast doubt on your view about the UK vis-a-vis France?
How about colonizing the Falkland Islands? There are literally 4700 square miles of lovely terrain with a population of 2,000 living in it. That might be a fruitful endeavor!
no need to go so far, have you ever been north of the Caledonian canal? There’s practically nobody there. Wick is the perfect choice for desperate people fleeing France.
An excellent idea and far, far better than salubrious Rwanda! It would also give the RAF something to do getting ‘them’ there.
Alternatively how about those sparsely populated Scottish islands?
Why not try comparing the lives of Brits under 50 with the lives of those under 50 outside of the first world and if anyone does they might see the underlaying problem in the UK is the entitlement culture that has developed in the UK and depressingly multiplied under Boris Johnson .
A land value tax to force the optimal use of our land, and to prevent the extraction of rent from the productive part of the community. It’s ludicrous to give up the state’s fundamental resource to homeowners, effectively creating a little sovereign realm of every home.
Take away the principle private residence capital gains tax exemption.
Introduce an imputed rent tax. If you own your home outright, and it would rent for £2,000 a month, you owe us £400 a month tax just as surely as if you owned any other income producing asset.
We won’t think. We can’t be made to. Sic transit gloria mundi.
Good article until the end. Net zero and high fuel costs hurt the poor and the rest of us. Otherwise agree so much more could be sone quite simply. My other suggestions include increasing inheritance tax gift allowances (grandparents will part with cash far more readily) and reducing capital gains tax on second homes. It’s meant to be a deterrent but stops people selling up when they otherwise would.
If the Conservative Party still considers itself ‘the Party of the Family’ then it is doomed if it doesn’t promote young people starting families, preferably in their own homes.
Let’s be clear: capitalism as practiced in 2020s Britain doesn’t work for the vast majority.
Let’s be clear, the class of rentier oligarchs (who are not capitalists) do not have special rights and their numbers mean that electorally, they are insignificant. If the Conservatives won’t strike a new Big Tent deal with them, then the Labour Party will come to power with one goal: sticking a terminal knife into that class of grasping, avaricious self-serving oligarchic master race nitwits. And that’s me being polite…..
I’m totally contemptuous of saying ‘housing markets should be global’. No they should NOT. They should be the preserve almost entirely of those who live in the country where the market exists. I don’t want to hear rubbish about restrictions on foreign ownership of property being ‘anti-capitalist’. It is anti oligarchs. It is anti unaccountable hedge funds in Hong Kong, New York or elsewhere. It is anti property developers who build for the ueber-rich who buy apartments they never live in solely as investments, often to smuggle out fraudulently obtained lucre from their home countries. Once you disassociate the cost of housing from the local wage levels, you have basically disenfranchised a whole nation of the most natural aspiration in life, owning your own home and starting a family in it. And you have thrown your lot in with global gangsters, criminals and Ponzi salesmen.
Now: the Conservative and Unionist Party have one simple decision to make: are they for the millions of honest, aspirational hard-working people in this country or are they c**ksuckers to globalist oligarchs and financiers who could not give one flying f**k whether the UK went down the tubes or not?
Words mean nothing on an issue like this: if their actions do not convince the millions of honest, aspirational hard-working people where their support lies, then they will be terminated by garotting at the next General Election and, quite frankly, good riddance to them.
Replace ‘God, King and Country’ with ‘Decency, Society and Family’, really live up to that new slogan and you have a chance.
Without doing something like that, start erecting political nooses all over the country.
I am not convinced immigration explains housing price increases.
Foreign born population
UK: 14%
Germany: 17%
France: 10%
I would argue UK housing prices are more reflective of London’s outsized role in global finance (like New York) and the Anglo-American economies that absorb global savings gluts. Michael Pettis is really good on this topic.
But to the older folks on here—I noticed plenty of comments on Netflix subscriptions and economic migration but no one has noted the trebling of tuition in the wake of the Great Financial Crisis that was borne by the young. I have also not seen any comments on the austerity measures borne by rural communities after the financial crisis. UK productivity has not risen for over a decade. Immigration does not explain that. Martin Wolf at the Financial Times had a really good article on productivity a few days ago.
Three to four million extra in the last ten years. They need houses. A lot of houses. So we have a shortage and prices go up. Brought in no doubt to “pay” for the pensioners but forgetting they too will so become one day. So more people, more houses ad infinitum? But the same sized UK.
“Nobody could imagine a Conservative government today redistributing housing wealth towards the young, regardless that much of it was ‘earned’ through planning restriction and loose monetary policy. ”
We can, sort of. I do myself. How? Simple: create building rights on limited-size plots of land for under 35s with no criminal record who have never owned a house yet. This does involve cutting a swathe through the existing planning system, yes, and it will inevitably create pockets of resentment and voter anger at the NIMBY level.
But look at the bigger picture: as a homeowner myself, I can see that I will not make it through retirement with my main asset safe from predatory taxation unless I permit the younger generations to get on the same housing ladder that benefited me. I have two options: face punitive wealth taxes that will drive me out of my home in retirement, or agree to a planning revolution that will certainly inconvenience me via construction and reduced amenity. What is not an option is for me to sit in my modest little castle (more commonly known as a 3 bedroom house) with an I’m-alright-Jack attitude and just expect everyone half my age to rent forever and just suck it up.
I read once that the total value of the UK’s existing planning permissions was over four trillion pounds, and that was before the house price boom we’re in now. It’s probably over double that amount now. It is also the case that most of the UK, even the crowded south-east, is still green (the UK-wide figure is that over 83% of the country is rural), so what this means is that we’re sitting in a country that is still dominated by vast tracts of rural space, and we could add trillions in value to the country’s collective wealth by simply decreeing a tiny proportion of that existing green space as land for new homes.
This might be politically difficult in certain areas, but it is economically and socially – and common-sensically – a slam dunk obvious thing to do.
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