Five years on
Posted: March 5, 2014 Filed under: Buy to let, Housing benefit, Housing market, Private renting | Tags: Interest rates, QE Leave a commentOn today’s fifth anniversary of record low interest rates all the talk is about how savers have lost out to borrowers. It should also be about renters and owners.
On 5 March, 2009 the Bank of England cut its main interest rate to 0.5 per cent, the lowest in history, and began its associated policy of quantitative easing in a successful attempt to prevent economic collapse.
But the effects continue to be controversial. The campaign group Save Our Savers estimates that savers have lost £117 billion in lost interest over the last five years plus another £209 billion from the way inflation has reduced the spending power of their money.
In contrast, borrowers have gained billions from lower interest rates. SOS’s message resonates because of the perceived unfairness that prudent savers and are paying to extricate us from a crisis caused by excess borrowing.
But what about the housing impact? In a CIH policy essay a few months ago, I did a rough calculation that mortgage borrowers have saved around £30 billion a year as a result of lower mortgage rates, QE and politcies such as Funding for Lending. Those with larger mortgages and with enough equity to remortgage to lower rates will have gained proportionately the most. The impact has also varied considerably between different regions.
Mixed messages
Posted: January 23, 2014 Filed under: Buy to let, Housing benefit, Private renting, Universal credit | Tags: Fergus and Judith Wilson, housing benefit, private landlords Leave a commentSo are private landlords about to pull out of the housing benefit market or not?
It’s one of the most crucial questions for the future of the housing system but the answer may be more complex than recent publicity suggests.
The alarm was raised when Fergus and Judith Wilson, the King and Queen of buy to let, revealed that they were evicting all of their tenants on benefit. A poll yesterday by the website spareroom.co.uk found that only 18 per cent of landlords currently rent to claimants, down from a third two years ago.
Read the rest of this post on Inside Edge, my blog for Inside Housing
Appearance and reality in the 2014 housing market
Posted: January 5, 2014 Filed under: Buy to let, Help to Buy, Housing benefit, Housing market, Labour market, Private renting | Tags: David Cameron, Fergus Wilson, housing benefit, Sharon Ray 3 CommentsCombine one ex-PR man prime minister with one lucky homebuyer who’s also an estate agent, then add one ex-teacher turned buy-to-let mogul. Welcome to the New Year recipe for housing, where perceptions are everything.
David Cameron used Help to Buy as a metaphor for the Conservative message about economic recovery and opportunity for all when he took part in a photo op in Southampton with a young mum and her toddler and had tea in the new home she’s just bought through a government scheme.
It seemed standard, if rather awkward-looking fare, until this post appeared on the internet claiming that the young mum, Sharon Ray, was actually Sharon O’Donnell, a sales director with the estate agent that allegedly sold the home. That was followed by a typically sexist story about the ‘attractive blonde’ in the Mail and this corrective about some exaggerations and errors in the original post. Cue a Twitterstorm and debate between those seeing the whole thing as an example of Tory fakery and those outraged by the hounding of a young woman who’d done nothing wrong.
10 things about 2013: part 2
Posted: December 30, 2013 Filed under: Buy to let, Help to Buy, Housebuilding, Housing market, Labour market, Planning, Private renting, Wales | Tags: Budget George Osborne, David Cameron Leave a commentHere’s the second part of my look back at the key themes I’ve been blogging about this year.
6) Help to Buy
If the bedroom tax was the subject I blogged about most in 2013 (see Part 1 of this blog), Help to Buy was certainly the best (or worst) of the rest.
The first hints of the scheme came in January as the coalition published its Mid-Term Review. Perhaps conscious of the gap between rhetoric and reality when it came to the government’s record on housing, David Cameron promised more help for people who cannot raise a deposit for a mortgage, with details to come in the Budget. By March Cameron and Clegg were promising what sounded to me like the coalition’s fourth housing strategy in three years. And in the Budget George Osborne duly announced what I called a huge gamble, loosening the targeting of previous schemes at first-time buyers and new homes and extending the help available much further up the income scale.
Inside the pressure cooker
Posted: December 16, 2013 Filed under: Homelessness, Housing benefit, Private renting, Welfare reform | Tags: DCLG, DWP, housing shortage, Joseph Rowntree Foundation Leave a commentSo what is really happening to homelessness in the wake of the financial crisis, housing shortage and cuts in benefits?
Where the Homelessness Monitor 2013, published on Friday by Crisis and the Joseph Rowntree Foundation, paints a picture of a grim situation that is bad and getting worse, the DWP and DCLG seem to see only sunshine and happy smiling faces.
Read the rest of this post on Inside Edge, my blog for Inside Housing
Gloomy forecast
Posted: December 10, 2013 Filed under: Help to Buy, Housing market, Private renting Leave a commentIt’s the time of year for predictions and the prospects do not look good for anyone struggling to get on to the housing ladder or afford their rent.
The latest Home Truths report from the National Housing Federation predicts that house prices in England will rise by 35 per cent by 2020. However, the bad news does not stop there for the ‘huge swathe of the population locked out of home ownership for life’ because rents will rise by 39 per cent over the same period.
The latest RICS housing market survey, also out this morning, shows that prices again rose sharply while expectations for future growth have risen to their highest level since 1999.
Read the rest of this post on Inside Edge, my blog for Inside Housing
First for Wales
Posted: November 18, 2013 Filed under: Homelessness, Legal, Private renting, Regulation, Wales | Tags: Carl Sargeant, Housing, Wales 1 CommentLegislation introduced today marks a historic moment for housing in Wales but it has wider significance for the rest of the UK too.
It makes history by becoming Wales’s first Housing Bill since it acquired greater devolved powers. The Housing (Wales) Bill aims to ‘ensure that everyone in Wales is able to access a decent home’ (though ministers behind all Housing Bills everywhere say that). The details are what count and the timing and the context are what create the wider significance. As Carl Sargeant, the Welsh minister for housing and regeneration, puts it: ‘Despite the impact of austerity measures and budget decisions taken by the UK Government, the Welsh Government is determined to improve the supply, quality and standards of housing and the proposals in this Housing Bill are crucial in achieving this.’
Read the rest of this post on Inside Edge, my blog for Inside Housing
Help to Rent
Posted: November 6, 2013 Filed under: Help to Buy, Housing benefit, Housing market, Private renting Leave a commentFor all today’s headlines about house prices, the most significant claim in new forecasts out today is that private renting will grow by another million households in the next five years.
That is one of the new forecasts for the housing market issued by Savills today and flows from its assumptions on what will happen to house prices. It comes despite the government’s flagship Help to Buy policy that aims to create more owners.
Read the rest of this post on Inside Edge, my blog for Inside Housing
Housing crisis? What housing crisis?
Posted: October 24, 2013 Filed under: Help to Buy, Housing market, Private renting 7 CommentsThe housing minister for England gave his first TV interview yesterday. I think it would be fair to say it did not go too well.
A week ago Kris Hopkins was ‘not available’ to appear on Channel 4 News to debate homelessness and house prices. This week the news peg was a 40 per cent increase in mortgage approvals and a 10 per cent increase in asking prices in London in a single month. He was interviewed as part of a package that asked ‘Is the housing market overheating?’
Interviewer Jon Snow presented him with four ‘key stats’ on completions (up slightly but still down by a third on the pre-crisis peak), house prices (up 5 per cent in a year), foreign home buyers (responsible for half of sales over £1 million in London) and the gap between prices in the north and south (up from £66,000 to £103,000 in the last year).
Here’s how it went with a few comments from me along the way.
Jules Birch 