I came across the campaign group Positive Money’s website this morning whilst reading letters readers of The Observer had written in response to its coverage last week of the rise in private rented housing in Britain, aka Generation Rent.
The website puts across a stark argument about the role banks have played in fueling runaway house price inflation by pumping billions of pounds into the property sector during the decade before the economic crash.
The result, it says, is that property values doubled in this time and we are not poorer, not richer, as an ever-increasing share of our incomes is spent on keeping roofs over our heads.
Check out the website, which sets out what the public can do to support the campaign. The two-minute video below sets out the argument about the role banks have played in creating this issue.
Housing is one of the big stories of the year, in terms of the impact it has on the economy and our lives. But a glance at the daily headlines reveals very little about the issues the sector faces that is new in itself, and merely seems to confirm what we already know.
Inside Housing, for example reports findings from a poll by Safestore which looks at public views on home ownership. The storage and removal company used that old PR tactic – a survey – to highlight familiar concerns (that we can’t raise the money we need to buy) and package these as a ‘finding’ that half the country won’t be able to buy a home in the future.
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It doesn’t seems like six weeks since I blogged about my reflections on 2010, which contained some personally important landmarks in my life. I’d like to take a different approach this time and look forward to 2012 rather than spend a lot of time looking back on a year which – for all sorts of reasons – was tough, extraordinary even, yet not as enjoyable. One reason why I have not blogged recently is because I have been absorbed in other matters and struggled to find the time to devote to writing (I can feel a new year’s resolution coming on here).
This is not to say some important things didn’t happen in 2011. I kept my job (which is positive), my wife lost hers in November and then was told she had got it back with a different organisation just before Christmas (negative then positive) and my little girl started school in September (life changing). Despite these things (and others), I will be quite glad to see the back of 2011 and look forward to a new year with optimism and hope.
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Cornwall’s house price problem hit the headlines again today, with news that local MP Stephen Gilbert can’t afford to buy a house in his constituency.
Mr Gilbert, MP for St Austell and Newquay, put his PR skills to good use by using his own circumstances to highlight the problems faced by locals who have no hope of saving for a 20% deposit in high value areas like Cornwall.
I remember the feeling as a reporter when I wrote about workers who were taking action over what they perceived to be bad wages, and would realise they were paid more than me.
I’m reminded of this today when I hear of measures aimed at helping young families onto the housing ladder and the need to address the country’s housing crisis. I am not debt ridden, or badly paid. But when Grant Shapps talks of young families who are caught in a pincer movement between the paucity of available credit, high housing prices and the substantial deposits needed to get decent mortgages, it feels like he could be talking about me.
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Housing minister Grant Shapps
Housing Minister Grant Shapps’ pledge in The Observer to deliver some stability to Britain’s housing market will come as welcome news to millions of people who can not afford to get a foot on the ladder.
In making the case for a cultural shift in the way Britons view their property investment, Mr Shapps is stating what many people who do not own their home have been aware of for years: that the current status quo should not be allowed to continue.
The facts in the South West, which has some of the highest house prices and lowest household incomes of any area in the country, are stark. In some areas, house prices are more than 15 times the average annual salary. Holding down two jobs is clearly not going to be enough in this case; 12 may just about do it.
I welcome the recognition that house prices can not be allowed to sky-rocket as they have done in the past, even if it is acknowledged that the Government can not set the cost of home ownership in this country. There are other elements to this complex issue, however. A focus on increasing and diversifying supply, creating a well-regulated and effective private rental sector as an alternative to home ownership and improving access to mortgage finance can all help in this area.
That’s a big set of challenges, but I know plenty of people in the sector who are up for playing their part in addressing them.