Tag Archives: housing crisis

ECB pays lip service to worries about inflating a housing bubble

The European Central Bank (ECB) raised its inflation target last week, at the same time going to great lengths to try to persuade people that it did not.

In the process, the central bank also stated that it will find a way to deal with an issue that is increasingly pressing: that of runaway house price inflation.

Continue reading

How to make renting attractive in the UK

Central banks have been busy saving the West from its own excesses since the great financial crisis of 2007, but in the process, they have made housing unaffordable for young people, particularly in the UK.

House prices have surged in many UK cities, with record low interest rates and money printing making homes more affordable for “investors” and less so for those who actually need them as places to live in, as opposed to assets to speculate on.

Despite record low mortgages and various subsidies, homeownership is increasingly unaffordable for a rising number of people.

The consequence is deepening inequality, which makes the UK look more like a feudal, rather than modern, society.

One of the ways to tackle the so-called “housing crisis” would be to make renting an option perhaps as good, if not better, than buying a property.

Here are four ways in which the UK government could go about making renting a truly affordable option for young people in the UK – and a few of the reasons why it will never do it.

Continue reading

House prices are becoming red hot, and this is scary

House price growth is accelerating in the UK and the rest of Europe, but it is far from healthy growth. The consequences of lax rules on lending to house buyers could be devastating.

Continue reading

Mortgage guarantee could sow the seeds of trouble

The UK government awarded hard-working medical staff a meagre 1% pay rise in the most recent budget, all the while splashing out on yet another indirect subsidy for house prices: the mortgage guarantee.

Continue reading

The UK should stop subsidising house prices post-Brexit

Forget Covid-19 and Brexit. The question to which most people in the UK would want an uncertain answer is what will happen to house prices in 2021.

Continue reading

Covid-19 should stop the government’s house price subsidy

Before the new coronavirus pandemic, one of the main ways in which the UK’s Conservative Party boosted consumer confidence was pushing house prices up with the aid of various taxpayer-funded schemes such as Help to Buy.

But as the damage done by Covid-19 to the economy heaps pressure on the public purse, should the taxpayer still generously fund schemes that mainly serve to boost house prices and the fortunes of a few big companies and their already well-off clients?

Continue reading

The safety of housing as an investment is about to be tested

The price growth of an “asset” into which investors everywhere around the globe have poured billions since the financial crisis has slowed dramatically, and this should worry policymakers.

Continue reading

Cooling housing markets will prevent interest rate rises

Housing markets in certain developed economies are beginning to lose steam, prompting worries that house prices might see corrections, especially in countries where they had been overheating.

Continue reading

As home prices hit record levels, negative equity looms

A statement from Halifax shares the “good” news: home prices paid by first-time buyers are the highest ever.

In the first half of this year, first-time buyers paid on average £207,693 for a home, the highest price on record. This is 4% higher than a year ago, and 50% higher than five years ago.

Continue reading

Brexit voters blame the wrong foreigners for the London housing crisis

One of the main complaints of some of the “Leave” voters was that Britain is a “small island” and it is “full up.” Immigration “puts pressure” on local services such as hospitals and schools, but, most importantly, on local housing.

Even Prime Minister Theresa May, when she was Home Secretary, said immigration was putting pressure on the housing sector.

Intriguingly, however, it seems the kind of foreigner whom the UK government welcomes is the foreigner who buys homes but never lives in them – the foreign investor.

Continue reading