Logical leap 1: One main argument for flogging off taxpayer-owned assets for short term political gain (aka "Right to buy") was the bollocks logic that it was "paving the way to a property-owning democracy where everyone had a real stake in their communities", which a lot of people still believe and regurgitate to this day. We know that this is bullshit on at least two levels* but let's go with it for now.
Logical leap 2: A majority of people are NIMBYs, so the Con-Dem government decided to try and win a few votes by making it easier for a majority to completely trample on the minority and oppose new construction in their localism bill.
There are, however, some significant flaws in the planning system that this Government inherited [this is more bollocks and lies, the planning system is little different to how it was last time the Tories were in government]. Planning did not give members of the public enough influence over decisions that make a big difference to their lives. Too often, power was exercised by people who were not directly affected by the decisions they were taking. This meant, understandably, that people often resented what they saw as decisions and plans being foisted on them. The result was a confrontational and adversarial system where many applications end up being fought over.
Fair enough, so what's our take away here? People like to own their home (that's a good thing) but they want as few other people as possible to be able to have a home, whether to own or to rent (that's a bad thing). Hypocritical and nasty, but at least you can see their point of view.
Logical lap 3. Here it gets tricky though. Home-Owner-Ism is about ensuring that people who own land get as much money as possible (especially if they make generous political donations), and the best way of doing that is to get planning permission and the next best is to collect rental income. So if you can give land owners planning permission to build rental accommodation and then channel taxpayer subsidies to them to finance the construction, that is pretty much the Gold Standard in Homey economics.
The government wants to encourage a wider range of investors to build houses for private rent. The 2011 Budget introduced changes to Stamp Duty Land Tax which will mean that large-scale investors pay a typical 1% instead of 5% on bulk purchases, as Stamp Duty will be assessed on the average value of individual properties rather than on the overall value of the portfolio.
The Budget also included a range of measures that were introduced in the 2012 Finance Act to support the development and growth of UK real estate investment trusts to make them more suitable for residential investment.
In response to Sir Adrian Montague's review of the barriers to investment in private rented homes on 6 September 2012 we announced:
•a £200 million fund to provide equity finance to house builders and developers
•a debt guarantee scheme to support the building of more private rented housing
•a team of private rented sector investment experts to support demonstration projects through the equity finance fund and development and take-up of the new debt guarantee scheme
The private rented sector is already governed by a well-established legal framework and we will not introduce any further regulations. This will ensure the sector is free to grow in response to market conditions.
But how the f- do you square that with 1 and 2? You can't, can you? Do the Con-Dems think that private tenants have a "stake in their communities" or that NIMBYs won't mind blocks of rented flats popping up all over The Hallowed Green Belt just as much as anything else?
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* We know that this is untrue on at least two levels:
a) Council tenants very much have "a stake in their communities", they have friends, neighbours, employers, their local shops; they know that if they want to complain that there is somebody at the council to whom they can complain, if local councillors want to be re-elected, they've got to sort out any problems on council estates etc. And they are perfectly aware that while council housing is not the nicest housing, it's good value and a council tenancy is something worth having. Council tenants are less likely to move than private owners, so if anything, they have a far larger stake (my grandparents lived in the same council house from the 1930s to the 1980s).
b) It must have been clear to a blind man that selling them off would merely lead to greater concentration of land ownership. The FT reports that one-third of the ex-council flats in Wandsworth are owned by landlords (one landlords owns 93, FFS) and even if they are only bought and sold between private households every twenty years or so, just like any other private housing, because people take out large twenty-year mortgages when they buy, this means that banks can collect over half the rental value as mortgage interest every year in perpetuity.
The first big mistake in that article is the headline "Right to Buy is not to blame for British housing shortage", well of course it isn't because there is no real housing shortage in the first place.
Nicked Bags
4 hours ago
14 comments:
"A majority of people are NIMBYs"
I'd dispute that. The type of NIMBY that objects to something being built that has no direct effect on them (something being built in the next street as opposed to slap bang in front of their house) is fairly scarce. Most people who display NIMBY tendencies do so for two reasons. Firstly, when they buy a property, they are forced to pay extra for things they don't own, like the view or the fact that there is a field at the bottom of the garden. Not unnaturally, they resent having that taken away from them. Secondly, most NIMBY activity is directed against large developers, who existing residents see as making a lot of money, largely at their expense.
Anyway I can't see the problem with NIMBYs: building more houses isn't going to solve anything as there is no housing shortage and it won't do anything to bring down prices. If it stops a few fat-cat developers making money out of land speculation, then so much the better, the getting of planning permission being one of the biggest sources of corruption in local government.
The Build to Rent Fund supports the development of new purpose-built privately rented homes. It will provide ‘off the shelf’ investment opportunities and take the risk out of building homes with the intention to let. Developers will repay or pass on the loan when new investors are found. The fund will also be used to build innovative demonstration projects to show what a more professional, larger scale private rented market might look like.
WTF? What about stocks, shouldn't the state "take the risk out of" capital investments, and "show how large, professional ownership of stocks" looks like?
Seriously, not many governments is this blatantly landlordists. We're slowly getting there, but this is cutting edge rent-seeking this here.
"WTF? What about stocks,"
Kj, don't give them ideas.
B, most people in this country (well more than half) are rabid NIMBYs. They oppose anything being built within five miles or so, they couldn't give a shit about anybody else.
The fact that they are possibly right for the wrong reasons is a quite separate topic. Don't forget that the same people oppose LVT even more violently.
Kj, the UK government invented Home-Owner-Ism (which is ultimately Landlordism), they are the cutting edge of corruption.
I agree - the Tories do not really believe in home ownership any more (if indeed they ever did).
However, the "right to buy" was in my view Thatcher's greatest and longest kasting achievement. It allowed council tenants to own a home when many of them could not possibly have aspired to that otherwise. And yes, there was a taxpayer subsidy to achieve that. The result was a serious undermining of the British class system - an unmitigatedly good thing. We now have young middle class families buying houses in what were council estates and living amongst working class families. And we have working class families who bought their council houses, sold again and moved out to privately-built estates.
You can argue about those rules that prevented councils using the proceeds to build more houses. But the right to buy itself was an achievement that changed the lives of millions and transformed the face of our country for the better.
AC, was that a send up of the sort of propaganda which Thatcherite Home-Owner-Ists spout, or are you actually being serious?
People who own houses take vastly more care of them (and the surroundings) that those who are given them for free.
It's anti-social housing that's the problem. How do I know? I used to live there.
Adam Collyer.
Well said.
SB, you rail against "those who are given them for free."
Does that include RTB people?
"B, most people in this country (well more than half) are rabid NIMBYs."
Do you have any evidence that this is true outside the environs of London, or, indeed, it is true at all? My experience of the countryside is in direct contradiction to this statement, i.e. that very few people are NIMBYs and that a fair proportion are the opposite. Also you seem to have this wierd conspiracy theory that the NIMBYs have some grand plan to stop houses being built anywhere, in order to prop up the prices of their own houses. Quite apart from the fact, which I learnt from you, that land prices (which make up the majority of house prices) are not affected by more land coming onto the market, there is absolutely no evidence, apart from a few vociferous nutters, that NIMBYs care about anything being done that does not reduce the value of their own property, i.e. they are reacting against a fall in value, not trying to promote a rise (and that's not one and the same thing).
AC, there is nothing wrong with the "right to buy". It's the "right to buy at a discount" that was wrong, because it was vote-buying on a grand scale. If council tenants had been given the right to buy their houses or flats at the market price and the council had been free to spend that money on building new council housing, RTB would have been the success you say it was. As it turned out it was a disaster for everyone except those who were on the recieving end of the vote-buying money and those who delight in harrying the poor.
"People who own houses take vastly more care of them (and the surroundings) that those who are given them for free."
Surely, if you inherit a house or are otherwise given it for free, then you own it? Anyway, the sort of people who are lazy and prepared to live in a shithole tend to live in a shithole whether they own it or not. Most people like to live somewhere "nice" and make the best of their homes, again whether they own them or not.
B, we've argued about this countless times.
I'm just going by what I hear people say, what people say to me when challenged, the letters which people write to newspapers, surveys which have been done asking whether people oppose new development in their area, all the HOOL and CPRE campaigns.
Perhaps this is a vocal minority and the huge silent minority is perfectly relaxed about new construction, but surely the pol's would know about this and would just ignore the NIMBYs if there were few votes to be lost (and plenty party donations to be gained) by allowing more development?
"but surely the pol's would know about this and would just ignore the NIMBYs if there were few votes to be lost"
But NIMBY activity tends to be concentrated round some proposed new development, which means there is a concentration of votes apparently to be lost in what might be a key constituency. Alternatively, in a safe seat, people of influence may be amoungst them. thus there political effect is out of all proportion to their numbers.
Also, my experience of being closely associated with NIMBY activists (some of the few) and being on the local Town Council has shown me that what people are really concerned about, when it's not a case of something being built to spoil their view, is what the new buildings will look like, not whether they are going to be built at all.
Having said all that, the incidence of NIMBYdom amoungst FBRIers is pretty high, but then, they tend to be retired folk with time on their hands.
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