Monday, 30 March 2015

Community generated land values.

All from today's Evening Standard:

Exhibit One (no link)

State schools in London risk becoming victims of their own success by pushing house prices up so high that teachers cannot afford to live near them, a senior mayor has warned.

Exhibit Two

A popular vegetarian restaurant is set to close after 40 years of trade in Covent Garden because the owners cannot afford to pay spiralling rent prices.

Food For Thought, in Neal Street, runs as a co-operative and counts celebrities and West End stars as regular customers.

Exhibit Three

The West End’s historic Chinatown will “disappear in five years” as oriental restaurants are squeezed out by rising rents and soaring property prices, traders said today.

The cheap and cheerful grid of streets lined with red lanterns and restaurants between Leicester Square and Soho have been popular with theatre-goers, office workers, late-night revellers and tourists since the 1950s.

Landlords Shaftesbury PLC, which owns 71 premises in the area, saw profits grow by almost 50 per cent in the six months to the end of March 2014.

A spokesman for Shaftesbury said: “The company, whose ownership in Chinatown has been built up over 50 years, has demonstrated a long-term commitment to supporting the local community through its strategy of creating lively, prosperous and interesting destinations in the West End for visitors, those working in the area and residents."

Exhibit Four

A run-down row of Edwardian villas once home to a community of squatters has been restored after decades of neglect — with some flats now up for rent at more than £3,000 a month.

The six blocks in Rushcroft Road, Brixton, were seized back by Lambeth council during violent clashes in 2013. During the eviction, squatters, some of whom had lived there rent-free for more than 30 years, fought with bailiffs, with furniture set ablaze in the street.

The 47 properties have been gutted and renovated in a project funded by the sale of half the block to private developers for a reported £2.5 million.


Random said...

Mark, I have been thinking about the pensioner exemption, I don't think it is a good idea to appease the homeownerists. Inequality amongst pensioners is high and a lot of it is down to property ownership (or non ownership.) This would make things worse.
I think a better idea would be to use the LVT to double the state pension. Then go on about how it is stingy, effect of homeownerism on children, etc...
I also think lowering the retirement age would be a good idea because:
1. It would free up a lot of jobs for younger people. If a young person is doing a job instead of an elderly person they gain skills.
2. A lot of people retire early, show how this is a "ripoff."
3. You could have a pension paid for "useful work" or "community work." Pensioners don't lose contact with community and the e.g. health problems retirement brings.
It is one of the few things that would help young people elderly people might support.
You could show how moving out of London could be a good thing and have a lot of cash to buy a cheaper place.
We need to change mindset from fixed pie, me vs others, to win-win, make the pie bigger.

Ben Jamin' said...

It's an interesting one.....

Do the suppliers of capital generate land values?

Shift demand yes, generate land values perhaps not.

I think Says Law states that supply creates it's own demand.

But I think this is bullshit.

A larger market/network increases productivity which increases aggregate demand.

Which both the owners of land and suppliers of capital try to tap into.

The difference being that capitalists produce wealth, and landowners merely transfer it.

Random said...

Do the suppliers of capital generate land values?
An awesome beach may make a house (land/location under it) worth more, do the owners of capital create it? So yes and no, although mostly yes.
The broadcast spectrum has value because of radio tech. Land is just a fixed natural resource
Geographical locations still has value in non-capitalist economies though.
Commies argue that labour creates all value. They advocate nationalising both capital and land.

subrosa said...

Thank goodness I live in rural Scotland.

Lola said...

I thought that it was part of The Plan that pensioners would get CI + State Pension?
The rest of your comment is social engineering, which is in large part is what gets us into these messes.
Indeed many people retire early. A ot of these are state employees able to take advantage of their generally generous pension schemes - police and firepersons for example.
OTH if anyone has saved and invested diligently and has generated sufficient cash capital to fund 'not working', then what's wrong with that.
The old saw of aged job blockers is a fallacy. One reason is experience.

Mark Wadsworth said...

R, I do no recommend 'pensioner exemption'. I recommend a deferment option.

As to 1, 2 and 3,
1 is a fallacy,
2 I don't understand and
3 is a brilliant idea, it would wind up the Daily Mailexpressgraph no end if they were given a taste of the medicine they love handing out to the young. Make the pension conditional on e.g. baby sitting your grandchildren, tidying up the park etc.

BJ: "A larger market/network increases productivity which increases aggregate demand. Which both the owners of land and suppliers of capital try to tap into."

The former more successfully that the latter!

R: "The broadcast spectrum has value because of radio tech. Land is just a fixed natural resource"

Radio spectrum IS land for these purposes!!

Technology increases land values in exactly the same way - for example the lift, which enables you to squeeze ten time as much building onto a plot and hence making it worth (potentially) ten times as much.

S, yes, but it's always cold up there. The south eastern tip of the British Isles is the most bearable, weather wise.

L, the plan is for state pensioners to get a 'Citizen's Pension' of around £150 a week, which is what the Lib-Cons promised would happen but I don't think it has yet. Wimps. The working age Citizen's Income for the time being would be £73 a week.