House prices to rise 50% in next 10 years, London to double...

[Weststander]

The big developers have 'land banks' capable of accommodating about half a million homes, but they prefer to drip-feed developments into the market over time to limit supply and keep prices at a premium. It's in their interest to build homes but definitely not in their interest to create a glut.

The entire start to finish planning process takes an average of 7 years. The large developers don't sit on cash mountains (I'd had a nose at their accounts last year) to be able to fund the working capital to develop more and they need to ride out very long lulls in the market such as the last two or three years ... very few buyers.

 

[Justice]

First bit is a fact. And where would all the additional skilled consultants and tradesmen come from?

An expansion of the developments carried out by housing associations is required.

A massive undertaking in terms of capital, training, land and other resources. Most probably only touched the sides by 2028.

In the inter-war years and post-WW2 large tracts of beautiful countryside eg the Coombes around much smaller Brighton were bought up and just built on an army of cheap labour. Not a care in the world for special fauna and flora.

There is f all profit for tradesman to work on new builds it’s not the lack of.
Prices are cut throat and not worth the hassle that’s why they are all shit builds. Shoddy materials not any care goes into the work as it’s in and out to try & make a few quid.
The government cover up lack of housing with the lack of tradesman garbage.

 

[fly high]

The entire start to finish planning process takes an average of 7 years. The large developers don't sit on cash mountains (I'd had a nose at their accounts last year) to be able to fund the working capital to develop more and they need to ride out very long lulls in the market such as the last two or three years ... very few buyers.

Yes but @Bry Nylon's premise is still valid. They bought up swaths of land in the 80s around towns & hired tenant farmers & probably continued to do so. Cheap farmland becomes building land sold at a premium.

 

[Weststander]

Yes but @Bry Nylon's premise is still valid. They bought up swaths of land in the 80s around towns & hired tenant farmers & probably continued to do so. Cheap farmland becomes building land sold at a premium.

The independent CMA found that housebuilders land banks do not distort the market, the planning process is the main constraint.

Which is why Labour have stepping in, announcing those days will soon be over.

 

[Guinness Boy]

The big developers have 'land banks' capable of accommodating about half a million homes, but they prefer to drip-feed developments into the market over time to limit supply and keep prices at a premium. It's in their interest to build homes but definitely not in their interest to create a glut.

But that’s big developers. Not “builders”.

The country needs more housing association / social housing. Not more badly built, tasteless big estates for Aaron and Stacey Turkey-Teeth and their Frenchie Luna.

“£500000 may seem steep sir, but you can almost walk round the kitchen and you’ll soon get used to the thin walls”.

 

[A mex eyecan]

But that’s big developers. Not “builders”.

The country needs more housing association / social housing. Not more badly built, tasteless big estates for Aaron and Stacey Turkey-Teeth and their Frenchie Luna.

“£500000 may seem steep sir, but you can almost walk round the kitchen and you’ll soon get used to the thin walls”.

Snob

 

[Bry Nylon]

But that’s big developers. Not “builders”.

The country needs more housing association / social housing. Not more badly built, tasteless big estates for Aaron and Stacey Turkey-Teeth and their Frenchie Luna.

“£500000 may seem steep sir, but you can almost walk round the kitchen and you’ll soon get used to the thin walls”.

I know a couple of builders and their aim per year is to (a) build and sell one house, (b) start another build and (c) be in the process of acquiring a plot for future development using the proceeds of (a). These tend to be 5 bed exec type places as that is where the margin is on a single dwelling build.

Meeting government new home targets will require the big developers on board - especially as they are the only people who can build housing association / social housing, as that requires multi-home plot sizes, marketing activities, part-exchange offers and finance deals well outside of the financial reach of local / independent builders.

 

[abc]

If there is not enough supply, then you need to either increase the supply or reduce the demand. If it's council houses, that's fine because that will increase the supply. Rent controls will do neither; experience of when that has been tried (eg. in Scotland now) is that it will increase rent prices and push houses from the rental sector to the buy sector, but that won't affect supply or demand because there is still 1 house in the market, and the reduction of 1 demand unit of the house buyer is offset by the increase of 1 demand unit by the homeless tenant.

It's possible via government intervention to increase supply by putting huge penalties (or repossession) on people owning empty houses, and by heavily restricting the holiday market, but surely that's getting too statist and intrusive. (Besides driving people abroad for their holidays and hitting the economy that way.)

Agree. What I was trying to say that in this case increasing the supply sufficiently is an almost impossible task - at least in the sort and medium term. Therefore to make housing affordable we have to have state intervention that will make renting affordable and the state will need build houses for rent.
My OP was suggesting that this be at least partly financed by some form of tax on existing home owners with houses over a certain value. Ultimately the money has to come from somewhere

 

[abc]

In other words, nobody will ever truly own their home.

Not at all. How do you come to that conclusion?

 

[Bry Nylon]

The independent CMA found that housebuilders land banks do not distort the market, the planning process is the main constraint.

Which is why Labour have stepping in, announcing those days will soon be over.

Yes. I've heard lots on the radio recently how the snails-pace planning process is also massively inhibiting development.

The upshot of that of course is that any Local Plans that have been created are as good as worthless now as the decision will be taken in Whitehall.

 

[fly high]

Not at all. How do you come to that conclusion?

Think that was in reply about people having to take out a loan to pay any tax imposed.

 

[Weststander]

Yes. I've heard lots on the radio recently how the snails-pace planning process is also massively inhibiting development.

The upshot of that of course is that any Local Plans that have been created are as good as worthless now as the decision will be taken in Whitehall.

The local plans (I await @BrightonCottager arguing with me ) often took many more years to complete than the deadline and failed to deal with the numbers shortfall during that long extra delay ... compared to other planning authorities. I know this for a fact with BHCC, a planning expert demonstrated this to me.

Then our population has risen by 11m since 1997 and nimbies hate this, people want to live in southern England e.g. by family.

The local plans that emerged from 2015 onwards in total fail to deal with the huge population gains etc.

 

[jordanseagull]

Not at all. How do you come to that conclusion?

If you are legally obliged to pay a yearly tax on your house, the penalty for non-payment would range from financial (including re-possession) to custodial. You’d be taking a compulsory loan to maintain an asset. It’s never going to happen and nor should it.

Anyway, the issue with supply won’t be resolved by throwing extra cash at it and maintaining the broken planning system.

 

[GrizzlingGammon]

The big developers have 'land banks' capable of accommodating about half a million homes, but they prefer to drip-feed developments into the market over time to limit supply and keep prices at a premium. It's in their interest to build homes but definitely not in their interest to create a glut.

This. No housing developer is going put lots of the houses on the market and cause house prices to drop. Over 1 million houses have been approved through planning since 2015, but not yet built.

 

[abc]

If you are legally obliged to pay a yearly tax on your house, the penalty for non-payment would range from financial (including re-possession) to custodial. You’d be taking a compulsory loan to maintain an asset. It’s never going to happen and nor should it.

Anyway, the issue with supply won’t be resolved by throwing extra cash at it and maintaining the broken planning system.

Taking todays headline of c 5% annual increase in house prices, paying say a tax of 10% of that increase (not the whole house value) to help solve the housing crises for those not fortunate enough to be born in the right decades, have parents that were or are amongst the very highest earners, doesn’t seem unfair.
I don’t know how the mechanisms would work but it’s not impossible. Though non payment issues is not an argument against or no taxes would be collectable..
I agree we have to fix the planning system but cash is exactly what’s needed to enable the state to build new council houses

 

[beorhthelm]

The big developers have 'land banks' capable of accommodating about half a million homes, but they prefer to drip-feed developments into the market over time to limit supply and keep prices at a premium. It's in their interest to build homes but definitely not in their interest to create a glut.

this is an area full of misleading information. there are said to be enough acreage/plots with planning for so many million homes, not seperating outline and full planning, or whether land will be used for residental or commercial development. the house builders, Barratt, Wimpey, Perismmon etc, report land banks in tens of thousands each or 12-18mths of building pipeline. then there are other developers who hold land in the various states of planning. my observation of several large developments is once final planning is granted, the builders break ground in weeks and houses go up in a year or so.

 

[dazzer6666]

If you have large amounts of equity in your house then you can borrow, if necessary, against this to pay your tax. Perhaps the tax should only apply to houses over a certain value and no doubt an allowance for typical repairs etc.

Not if you don’t have the income to make repayments

 

[A mex eyecan]

Not if you don’t have the income to make repayments

don’t worry about such little details as that ….

 

[beorhthelm]

Taking todays headline of c 5% annual increase in house prices, paying say a tax of 10% of that increase (not the whole house value) to help solve the housing crises for those not fortunate enough to be born in the right decades, have parents that were or are amongst the very highest earners, doesn’t seem unfair.
I don’t know how the mechanisms would work but it’s not impossible. Though non payment issues is not an argument against or no taxes would be collectable..
I agree we have to fix the planning system but cash is exactly what’s needed to enable the state to build new council houses

taxing homes on basis of house price rise wont build a single property, it'll just raise a slush fund for other purposes, while wrecking finances of many (honestly, asking pensioners to go into debt after a life of saving?). raising money isn't the problem, simply allow councils to fund building, open planning to allow them and private developers to build where they need to.

 

[abc]

Not if you don’t have the income to make repayments

Fair comment.
It just seems unfair that many people ( me included) are sitting on significant equity for basically being in the right place at the right time rather than through hard work or entrepreneurship, whilst so many younger people are struggling to afford anywhere to buy or rent.