What the fuck is this?

Landlords should be banned from buying new-build properties and have less access to buy-to-let lending to address the wealth gap between them and their tenants, a thinktank has suggested.

I\’m sorry? What?

Individuals should be banned, by law, from purchasing or using property as they wish because inequality?

The SSC\’s analysis of the sector, based on official figures, found that private sector landlords tended to be wealthier than the general population, with an average of £75,103 held in savings, bonds and other investments. In contrast, private renters had an average wealth of £9,506. While 50% of landlords had accrued wealth of up to £20,500, the same proportion of tenants had just £398.

We\’re to abandon the entire concept of equal property rights because of a piddling £20k difference in accumulated wealth?

Landlords were older than tenants, with an average age of 48, compared with 32 among renters,

Err, hang on, don\’t we expect people 16 years older to have greater wealth? Hasn\’t someone explained the lifetime cycle of weatlh creation and consumption to these people?

20 thoughts on “What the fuck is this?”

  1. So Much For Subtlety

    The very concept of a free society is beyond these people. And unfortunately they are our ruling class. The language of liberalism is one they simply do not understand.

    Alas they will win in the end. Because they keep coming up with dumb ideas like this one and you can’t kill them all.

  2. It’s all very well waffling on about free society.

    But we don’t have a free market for housing, supply is heavily restricted, particularly for the type of houses people want (as opposed to flats, no end of those).

    Maybe this is the wrong solution to the wrong problem.

    And maybe we shouldn’t “concrete over the greenbelt” as some people would describe it.

    But fuck yes, we do need some kind of market controls to balance out the already existing meddling that is partly responsible for stupid prices.

  3. “Individuals should be banned, by law, from purchasing or using property as they wish because inequality?”

    Welcome to the politics of envy.

  4. A higher proportion of peoples wages are going towards rent/mortgage as these are increasing faster than wages, and the % of households renting rather than buying is on an increase.

    Does that answer your question JuliaM?

    The market is screwed due to artificial constraints.

    Either remove those constraints (good bye greenbelt), or put some redistributive policies in place to mitigate those constraints.

  5. fake, it’s the market controls and meddling that have got us into the mess that we are. You are asking for more controls and meddling to get us out of it? By the same people who came with the ideas that got into the mess that we are in now? Seriously?

    The reason there are so many flats is because government guidelines stipulated a certain number of properties per acre. And the more the better. So how better to meet that requirement? Build flats. Planning departments would happily approve them as they met government guidelines and developers like this as the uncertainty of the normal planning process is avoided.

    Oh, and the greenbelt is not actually green. Fly around and look down and you will see that many greenbelts are quite urbanised already. And there is no danger of concreting over this green and pleasant land. Again fly over the country a bit more and you would be hard pushed to see wall to wall concrete. All you will see is a lot of green.

  6. fake, the percentage of salary on rent is increasing because of the costs to landlords plus the extra government meddling of housing benefit which allows landlords to ask as much as they want.

    The percentage of householders renting is not a problem. In fact if more people rented, the working population would be a bit more mobile and could move to where the jobs are. When you own a property it is harder to move.

    The market IS screwed due to artificial constraints. Remove these constraints, eg government guidelines meddling and interference and the market will find its own level. Renters will only pay what they can (not what housing benefit pays), landlords will offer houses to a standard that rents. And if the rental market does go tits up then it’ll be the landlords who suffer, what’s not to like about that.

    And I talk as a landlord who has rented on many occasions.

  7. *Fake, it doesn’t answer my question at all. Why is the rising rate of renters a concern?*

    Because this isnt Victorian England any more FFS.

    And the rising rate of renters is due to the rising cost of housing (and subsequently rent), being higher than the rise in wages

    How is that NOT a problem?

    Oh wait, I can just guess how old you are……………

    *fake, it’s the market controls and meddling that have got us into the mess that we are. You are asking for more controls and meddling to get us out of it? By the same people who came with the ideas that got into the mess that we are in now? Seriously?*

    Er, no. trying to hard.

    I said we either REMOVE those market controls, or put more controls in place, the current controls are there to protect the green belt, and for green policies, they are not their to control the price, and have a definite impact on price.

    So now we need to remove those controls, or accept they affect price and so do more.

    You are being a silly libertarian by automatically going “controls are causing problems so more controls are not the solution”, silly silly silly.

    *The reason there are so many flats is because government guidelines stipulated a certain number of properties per acre. And the more the better. So how better to meet that requirement? Build flats.*

    So market controls reducing supply of what people want, thanks for proving my point.

    *Oh, and the greenbelt is not actually green. Fly around and look down and you will see that many greenbelts are quite urbanised already. And there is no danger of concreting over this green and pleasant land.*

    Besides the point, greenbelt policies do restrict housebuilding, ***I’m not getting into an argument about that being a good or a bad thing***, I am simply pointing out the economic impact on house prices that has.

    The price of houses and flats is vastly inflated, even flats that are small with only 1 parking space, that no one really wants, are overpriced, because the overall building rate is artificially constrained.

    *The percentage of householders renting is not a problem. In fact if more people rented, the working population would be a bit more mobile and could move to where the jobs are.*

    Hmm, lovely.

    Until of course they are no longer working, and therefore cannot afford rents (and had no opportunity to pay of the mortgage).

    Colour me surprised when more and more people of my generation rely on state housing when they get older.

    *The market IS screwed due to artificial constraints.*

    Right, thanks.

    Now hands up who thinks those constraints will ever disappear, fiddled with yes, but disappear?

    Hmmmmm.

    No.

    My generation is paying for piddly little flats, the same amount of money your generation would have paid for nice large houses with gardens, for the same money (adj for inflation).

    Thanks so fucking much.

  8. I’m with Fake on this, to an extent. The housing-market distortions have gone a long way to reversing the rise in equality brought about by the good kind of socialism at the start of the last century. Sure, the proceeds of production are still relatively equally distributed, but those who own property are now, thanks to the state-mandated rents (in an economic sense), screwing the ‘workers’ out of their share through inflated rents (in the housing sense) and housing costs. We really do need to do something about this pretty pronto, although I’m not convinced by Fake’s solutions, such as they are.

    Ultimately, the property price-rises this country has seen have had the effect of unfairly concentrating an overly large proportion of this country’s wealth in the hands of the boomers. Government made the mess, government will have to clear it up, and the boomers will have to get by with less. The only question is the kind of methods by which the government resolves the problem, whether by direct taxation/interference, or deregulation and use of markets as far as is practical.

  9. Fake

    “And the rising rate of renters is due to the rising cost of housing (and subsequently rent), being higher than the rise in wages”

    So higher price for something leads to higher demand? sounds perfectly logical doesn’t it…

    “Until of course they are no longer working, and therefore cannot afford rents (and had no opportunity to pay of the mortgage).”

    pensions? savings?

    “So now we need to remove those controls, or accept they affect price and so do more.”

    Because that has worked well elsewhere?

  10. -Dave-

    *We really do need to do something about this pretty pronto, although I’m not convinced by Fake’s solutions, such as they are.*

    I don’t really think much of my own solutions either, but it’s “something must be done ism”, I’m sure smarter people than me can come up with sensible policies.

    We either stick with our restrictions and come up with some counters for the increased cost they cause, or tear them up.

    I can’t keep sitting around people in their 50s, going on about how we shouldn’t be laying one single brick on any part of greenbelt, whilst they pay (adj for inflation) significantly less for significantly more, half of them couldn’t afford their own properties under their current wages and today’s prices.

    Yes, I know people should be wealthier as they get older, and some of this may be perceived as “young persons envy”, but the costs compared to wages are much higher for my generation, this will effect my generations entire quality of life.

    -Emil-

    *pensions? savings? *

    So pay full rent for you working life, whilst trying to save, then try carry on paying rent on pension and those savings, all while rents and mortgages are rising against wages.

    What?

    There are many people that should be able to afford to buy housing with their current wage, but house prices are so hugely inflated.

    So instead these people will live a life of much higher costs (as rents will continually increase, but mortgages can be paid off).

    Then they face a retirement of much much higher costs vs income, or just run to the social for housing.

    Fuck. That. Shit.

    So how about instead we either deal with what causes high prices, largely but not solely restrictions on building.

    Or the people who so avidly want to protect the green belt, can fucking pony up for it, rather than forcing the costs onto the preceding generation.

  11. Fake>

    I think there’s a fairly simple solution, if we’re willing to build more. Auction off the planning permission slots. It would be interesting to find out whether people would bid for nearby planning permission in order to prevent the land being built on.

    I’m all in favour of more building, if it’s done right. We could just compulsorily purchase a London suburb and rebuild with much higher density. Personally, I’d favour building a fast, subsidised rail link to Lincolnshire, and extending the motorway up there as well, then building a proper new suburb of London – there’s plenty of space. If it’s a half an hour commute on the train, it would be closer, in travel time, than most of London outside zone two or three. A side benefit is that trains run in both directions, so Londoners would get a fast rail link to a nice part of the world. It would be fun to have a beach ‘in’ London, and Skegness is in just the right place.

  12. Irrespective of the freedom issue can anybody suggest any way in which preventing people pay for houses will increase the amount of new housing built?

    Thought not. Perhaps the parasites in power don’t want housing built so that they can make electoral hay out of its unavailability. .

    The only I can see it being justified as not grossly harmful is if we accept the housing market is so subject to regulatory theft already (with 75% of the cost of housing being state mandated) that the parasites have ensured it is completely unaffected by the laws of supply and demand already.

  13. Since when did the product of a conversation down the pub after ten pints of lager qualify the group for “Thinktank” status?

  14. *Irrespective of the freedom issue can anybody suggest any way in which preventing people pay for houses will increase the amount of new housing built?

    Thought not.*

    But your not preventing people from paying for houses.

    Your preventing one group of people that can pay inflated land prices from paying for houses.

    A house will still cost 60k (or whatever) to build, and 80k to sell, it’s just that the land it sits upon won’t add another 100k onto the price.

    Well that’s the theory anyway, again I don’t think this is the right solution.

  15. @ fake
    The “solution” proposed by the SSC will make housing and more expensive by exacerbating the cyclicality of housebuilding. Do I need to explain?
    Only a minute proportion of first-time buyers buy new-build house, but that is irrelevant. Buy-to-let landlords have traditionally bought newly-built properties during downturns in the housing market when builders were willing to discount the price of new-build to generate cashflow by getting them off their hands. If you ban buy-to-let landlords from buying new-build you eliminate this longstop for housebuilders so they either build fewer houses or go bust. The reduction in the build rate make the shortage worse and pushes up prices and rents. The inability of buy-to-let lanlords to buy new-build when it is cheap will be a secondary factor in pushing up rents.
    I am not going to bother to answer your arguments in detail because adding more controls – especially those proposed by SSC – will just make a bad situation worse.
    The largest single factor in the housing shortage in the south-east is the poor drafting of the Atlee government’s Planning Act which limited the number of dwellings per acre taking no account of the difference between multi-storey flats and two-storey semi-detached or even bungalows. So some of the tower blocks in London are surrounded by acres of unused space.

  16. The percentage of householders renting is not a problem.

    Ask people who live next to rented properties if that’s not a problem.

    I grew up on a street full of working-class families, and there was never any major problem with the neighbours. They’d lived there for years, they expected to be living there for years, and they had no desire to annoy the people who’d be living near them during that time.

    Then house prices more than doubled, and now no working-class family can afford to live on the street. So when my mother’s neighbour moved out, the house was bought by a landlord and stuffed full of Poles who liked to have drunken parties at two in the morning.

    Similarly, in the last shared house I lived in, we had about six cars parked to fit around a house that would previously have been occupied by one family, and we knew we couldn’t possibly ever afford to buy a place there so we had no incentive to keep the neighbours happy. The landlord did as little as she had to for the house, so it was a wreck compared to the rest of the street.

    Unless you’re at the top end, where your employer is happy to pay thousands a month to rent you a fancy house, renting sucks for everyone other than the landlord. Renting because you can’t possibly afford to buy a place of your own sucks even more.

    And, as always, having created the problem with central planning of housing and interest rates, the statists want to ‘solve’ it with more restrictions rather than by eliminating the root causes.

  17. If you think the asset is over-priced then why would you want to buy (with leverage). Surely the renters are the smart ones? The return to a buy to let landlord is barely more than the cost of borrowing (post tax) so the notion of some vast rentier class of landlords ‘exploiting the workers’ is nonsense. Taking a family house and filling it with 6 Poles paying cash is completely different and is already covered by law and regulation.Ultimately the fact that there are more people renting than buying is because the banks worked out that a 22 year old student nurse wasn’t as good a credit risk as a 50 year old lawyer and given the ‘rules’ say that they can both borrow at the same rate, the obvious answer is to restrict access to borrowing for the student nurse…plus of course all those regulations designed to keep everyone ‘safe’ say they can’t lend to them anyway. When I bought my ‘cheap’ flat ithere were mortgage queues and nterest rates were 14% and it took 80% of my take home salary, while the previous generation ‘earned’ 14% for taking no risk whatsoever with their cash – actually the banks simply recycled it in ‘low risk’ mortgage loans. As interest rates fell, the capital value of the properties rose – that’s financial economics – giving a capital gain to those that took the risk/made the sacrifice at the time. Now we are told we should provide ‘affordable housing’ for everybody that ‘deserves it’, unfortunately the end result will be just like the working class families moving out of gentrified areas, those with access to the affordable housing will simply collect the spread between the ‘fake’ price and the real world price. So naturally they think it is a good idea, like fixed rents, great if you get one, awful if you don’t.

    It’s like the journos that work for the Evening Standard and the Mail, they gawp at the estate agents windows near their offices in Kensington and then write about how awful it is that they can’t afford some of the most desirable real estate in the world – especially when (as they never miss the opportunity to mention) they went to Oxford and everything.

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