In a single graph.



As good a point at which to start a discussion as any.

Its a great shame to see how the local authority building program falls off and then disappears off the graph in the 1990s - the peak that you see in the 1970s is when I was employed in the building trade and a huge percentage of our work was on local authority new build schemes - times were hard in the 1970s, 3 day week, power blackouts, recessions, wage freezes, etc etc etc, and yet money was found for social housing by both flavours of government - also surprising to see that the level of private home building has barely changed at all since the 1960s.

... and it's pretty clear to see that nothing has replaced it ... so prices rocket.

Why does the housing association line track so closely to the private market line?

Is the availability and therefore price of land not a factor in the reduction in the amount of homes built?

It's also pretty clear under which government the supply was restricted. Why did they do that? Let's think what else happened - oh, yes a credit bubble (based on rising property prices to underpin borrowings) to create a feeling of rising wealth in order to mask the reality of economic decline.

Still don't think Labour got us into this mess?

Therein as I have been saying for ages also lies the difficulty in finding a solution through mass construction. If house prices decline then borrowings won't be covered by asset prices and banks will collapse.

Bull[is[/ihit

House prices would have to decline to 20% of their current value to cause anything like a genuine problem.

Notwithstanding that, there could still be a privately-funded, mass housebuilding programme that would provide a real stimulus to the economy, there's absolutely no reason for those houses to be built to sell. There's plenty of demand and a concommitant wish to fund, long-term rental properties

The rapid decline in local authority funded house building was taken up by housing associations - back in the 1970s when all local authorities received budget allocation or central government loans to build rental homes the housing association was a fairly rare animal, usually restricted to building and running old folks homes (RBLHA for instance), the company iw roked for did work for a handful of housing associations but most of our income was from local authorities and private housebuilders.

I personally don't believe that there has ever been a shortage of house building land, just a lack of imagination and finance for rental properties, it took a tightening of green belt useage in the late 1980s for the private sector to turn towards inner city brownfield sites and slowly realise that a sector that they had ignored to date was the next golden goose - one and two bed apartments built in tower blocks on cheap brownfield sites, you'll also note in every city centre just how many of those apartment blocks were not rented out direct from the developer but sold to private landlords, the developers made their money and moved on and hardly any of them were built for social housing simply because the local authorities were not allowed to build by that time and the associations either had a complete lack of foresight or no access to cheap funding due to political will which prefered to encourage individuals to sponsor rental properties rather than central government.

If it were so easy and not reliant on public money why is the mass housebuilding programme not underway - surely if you are correct it is a no brainer and every commercial builder would be clambering to get on board?

My way doesn't require one single penny of public money, unfortunately neither does it provide massive profit margins for avaricious speculators.

I've detailed it often enough on here, do a bit of work and find it for yourself

Quite clearly your theory is just that theory - simply not workable in the economic climate in which we find ourselves in. Businesses are not charities, they require profits/cash flow to keep functioning - even the Quakers who you so admire did their charitable deeds from positions of wealth unimaginable to us. Businesses are not going to undertake huge projects for little return, the risks are too high even you can surely see the flaws in your argument?

Which is where the public funding element of social housing kicks in, as someone stated earlier this week, "public services are supposed to cost money, its why we pay our taxes".

In theory there was nothing wrong with the now demonised buy-to-let schemes of the 1990s, other than the fact that several elements in the ladder needed to make a profit along the way whether it be from the construction of the buildings to the financiers who lent the money to private individuals to purchase them in the first place, and its that need for the financiers to make ongoing profits from the lending that is keeping private rents artificially high now - its cheaper to buy than rent, if only you can raise a deposit, which is not the way it should be.

A non-political overview of the country's housing stock in the 1980s should have decreed a proper market price for existing social housing stock without discounts to tenants (try that one on if you rent a car from Avis and then offer them a quarter of its value to purchase it when you take it back just because you've rented it for a while), only on the proviso that monies raised from sales were re-invested into new housing stock or refurbishment of existing stock.

There's nothing wrong with a government investing taxpayers money into housing for its citizens, its only political attitudes that look upon the topic as if its something they trod in on the street and walked into the carpet - the stock doesn't lose its value (have you seen what decent ex-council houses sell for now), the construction of them was always of top quality (we hated working on council house sites only because each one had a clerk of works, you never saw them on private housebuilder sites) and the maintenance SHOULD have been kept up to date were it not for political will.

Political hatred of other classes has screwed this country for the last thirty years.

Now where I have ever said that profit couldn't be made or that businesses should operate as charities?

Do a search on my previous posts on the subject but if that proves a little too difficult for you, have a read of this:
[i
Before laying a single brick: introduce Land Value Taxation on all undeveloped land and any land containing an empty property. Based on the maximum developed potential of the land, the imposition of LVT should be sufficient to stimulate either a building explosion or the release of suitable building land onto the market. That should see a marked drop in land values and although it may be viewed as engineering a reduction in land prices, it will only mitigate the false increase in land values following Right to Buy.

Central and local governments control thousands of hectares of land suitable for house building, this land is owned by US the taxpayer, it is only administered by governments. So release this land to housing charities and other not-for-profit housing organisations, on 99 year leases at peppercorn rents. Allow these organisations to go to the money markets to attract the investment to fund construction. The actual cost of building a house (materials and labour) is only around 40% of its total value, the remaining 60% is the cost of the land it sits upon. There are many European institutional investors who would see the attraction in long-term investment, paying an attractive return.

These new houses could then be rented at around 50% of the prevailing rate, giving the investors a suitably attractive, long-term return and retaining a buffer for maintenance. They should also be under a robust, non-challengeable covenant to prevent any future right to buy,

The pluses include:

1) increased employment in the building sector, leading to a lower benfits bill and an increase in Income Tax & NI revenues

2) Increased employment in retail sectors - all these houses will require furnishing - with similar improvements in tax & NI revenues as in 1)

3) Lower rents leading to reductions in Housing and other benefits

4) Lower rents in the private sector through a knock-on effect

It would also require a change to the current mindset that everyone should aspire to be a home-owner. Prior to the 1980s, there was no stigma involved in renting your home, plenty of middle-class families lived on very attractive council housing developments.

There would of course be some losers: Buy to Let landlords and the banks who loaned them the money are the most obvious. But hey, we're all in it together ain't we?[/i

I'm still waiting for someone to offer a serious argument against, care to have a go?