Monday 20 January 2014

Reader's Letter Of The Day (2)

From last Friday's Guardian, actually:

Ed Miliband's plans for the political realignment of the middle class may well founder on the issue of home ownership, which you identify (Editorial, 15 January) as the key to middle-class self-identification.

With house (basically land) prices so high, Labour's only recourse would be to its old post-war model of the development corporation, compulsorily purchasing land at agricultural prices and retaining any planning uplift while developing houses for sale or rent, preferably on garden city (and village) principles.

Ideally a revived middle class could benefit from increased job mobility via a computerised letting service and move first into high-spec rented property then, after saving a deposit from the affordable rent, buy a house, as of old.

A land value tax would be necessary to cap any current land value inflation, so maintaining the house price stability achieved.

DBC Reed, Northampton.

10 comments:

Lola said...

Cat. Pigeons. Well done.

DBC Reed said...

Ironically there seems to be a lot of this kind of talk about at the moment: about new towns and development corporations -all in the past few days.
Mark's sketch of National Mortgage Bank seems to me to indicate a link-up between arguments about banks and the arguments about development.Lets hope he develops the sketch up to blueprint scale.And publishes it mainstream.

James Higham said...

compulsorily purchasing land at agricultural prices

= theft.

Mark Wadsworth said...

DBC, thanks for dropping in. Our putative National Mortgage Bank is just LVT by the back door.

JH, OK, how about voluntarily offering to purchase ag land at a 20% uplift to market value? It's still tuppence ha'penny once they've abolished agricultural land subsidies.

Derek said...

The more backdoor, frontdoor or sidedoor methods of introducing LVT, the better. A National Mortgage Bank sounds good to me. Gives the consumer a bit more choice too.

Contact YPP said...

D, I'm always a bit wary about "the government" doing stuff, but why lend taxpayers' money to banks interest-free so that the banks can on-lend at 3% or 4% to borrowers?

Why not lend straight to borrowers at 3% and cut out the middleman?

Bayard said...

Because the whole idea is to cut in the middleman.

Mark Wadsworth said...

B, correct.

Kj said...

... and when LVT is implemented in full, govt can merrily write off all those debts over and above the changed house-price (if that's the case).

Mark Wadsworth said...

Kj, yes of course, well spotted. Whether NMB gets monthly interest payments or the government gets monthly LVT payments does not make any difference.