Originally published on April 17 on my blog for Inside Housing.
Dominic Raab’s comments about immigration and house prices may have sparked a furore but they also shine a light on something else about the recent history of housing.
Amid mounting pressure, on Friday the Ministry for Housing and Communities Local Government (MHCLG) published updated analysis that he had relied on for his claim that he had been told by civil servants that immigration has increased house prices by 20 per cent over the last 25 years.
When I tweeted about it, the man himself came back to me with this:
In fairness, he could have added that the increase was actually 21 per cent but, as I suggested last week, that is minor by comparison with the 284 per cent total rise in prices that happened between 1991 and 2016 and accounts for just £11,000 of the £152,000 increase.
According to the analysis, increases in real earnings were a much more important factor in price rises.
Look a little deeper, though, and the analysis does not really prove very much either way.
Originally published on April 9 on my blog for Inside Housing.
The latest Mr Buggins to take his turn in the housing minister job gave a revealing first print interview on Sunday that speaks volumes about his priorities.
The new(ish) minister – I forget his name, they come and go so quickly – makes the seemingly incendiary claim that immigration has pushed up house prices by 20 per cent over the last 25 years.
He tells the Sunday Times that he is writing to the Migration Advisory Committee (MAC) to urge it to consider the negative effects of immigration on housing demand as well as its positive economic benefits.
Mr Buggins is playing a key role in the drive to boost housebuilding but he says: ‘You’ve got to deal with demand as well as supply. You can’t have housing taken out of the debate around immigration. If we delivered on the government’s target of reducing immigration to the tens of thousands every year, that would have a material impact on the number of homes we need to build every year.’
He says he’s been told by civil servants that immigration has had a sizeable impact on prices based on the Office for National Statistics house price index from 1991 to 2016.
Originally posted on October 11 on my blog for Inside Housing
The comments prompted outrage online and in the comment pages of the newspapers and the ones about inheritance saw him ‘slapped down’ by Downing Street. These were ‘personal comments’ and ‘certainly not policy’, said No 10.
But what did the housing minister actually say?
Originally posted on October 6 on Inside Edge 2, my blog for Inside Housing
What would ‘housing that works for everyone’ look like?
Housing was a constant theme running through the Conservative conference this week. Communities secretary Sajid Javid said it was his ‘number one priority’ and announced a new(ish) £2bn fund for accelerated construction on public land plus ‘further significant measures’ in a white paper in the Autumn.
Housing minister Gavin Barwell is said to have addressed 17 different fringe meetings on housing and continued his charm offensive with more sensible comments about the need to encourage all tenures and tone down the obsession with home ownership and starter homes.
And Theresa May herself singled out housing as one example of market failure that requires government intervention to create ‘a country that works for everyone’ and an economy where ‘everyone plays by the same rules’:
‘That’s why where markets are dysfunctional, we should be prepared to intervene. Where companies are exploiting the failures of the market in which they operate, where consumer choice is inhibited by deliberately complex pricing structures, we must set the market right.’
‘It’s just not right, for example, that half of people living in rural areas, and so many small businesses, can’t get a decent broadband connection.
‘It’s just not right that two thirds of energy customers are stuck on the most expensive tariffs.
‘And it’s just not right that the housing market continues to fail working people either.’
Originally published on June 24 on Inside Edge 2, my blog for Inside Housing
As the dust settles on the momentous vote for Brexit, the one certainty seems to be uncertainty.
I blogged last week about what would follow a Leave vote that seemed a possiblity but no more than that. Here’s my updated take on the likely consequences for housing now that it’s a reality.
The markets are signalling, no screaming, that they expect huge dislocation. Shares in leading housebuilders led the stock market plunge, with falls of 40% or more at one stage, and banks were not far behind with falls of 25%.
You could read this as a signal that the City expects house prices and land prices to fall with severe impacts for both – or as a reaction to panic and uncertainty.
Either way, there will be short-term consequences. Housebuilders look certain to scale back development, stop opening new sites and hold off on decisions to invest in land. Equally, few people will want to buy in a market that could be about to see prices fall and the wider market will stall.