MAGGIE PAGANO: The housing bubble is breaking young people’s dreams

0
28
Falling... but still high: London prices have fallen at their fastest pace since 2009


Bravo to New Zealanders. Their government has just banned foreigners from buying homes in a bid to tackle sky-high house prices.

With average house prices in the Auckland capital costing NZ$835,000 – £431,000 – the homes are among the most expensive in the world when compared with people’s incomes.

The government defended yesterday’s move, saying that stopping foreigners snapping up houses was the only way of ‘restoring the great New Zealand dream of home ownership’. 

Sound familiar? Sadly, the dream of buying their own homes for the younger generation has become the stuff of nightmares – which is why it is good news that London house prices are cooling.

Falling... but still high: London prices have fallen at their fastest pace since 2009

Falling… but still high: London prices have fallen at their fastest pace since 2009

The latest ONS figures show that London prices have fallen at their fastest pace since 2009. The cooling down is due to many factors: fewer buy-to-lets and rich overseas buyers, but also rising interest rates and the continued squeeze on consumer spending.

Yet house prices are not lower because of falling demand. There are thousands of youngsters who are sharing houses, desperate to get onto the housing ladder. Add in boomerang children (those who return to live with their parents after leaving home) and you see the pent-up demand.

It’s the supply of homes at the right price that’s the problem. The average London house still costs £477,000 – about 12 times higher than the £34,000 median salary. 

Moving is an option: average homes in the North cost £127,000. But the young are not daft: they will continue to swarm to London because that is where the opportunities are. Until there is more investment in our great Northern cities, they are not going to move. And why should they?

There are solutions, and it feels like Groundhog Day to keep repeating them. Yet ministers still don’t get the message. Councils must be forced to release more land and fund housing schemes. Planning regulations in and around the green belt, introduced for a post-war era, must be torn up.

More conversions from commercial to residential properties in town centres must be pushed through. You hear endless stories about councils keeping properties empty rather than going through the rigmarole of planning. Yet every study shows the more living and office space you have on a high street, the busier they are.

It doesn’t take a genius to work this out. It’s good to see the New Zealanders having a go at breaking the mould. They will be watched from around the globe as the world’s biggest cities, from Barcelona to Sydney, share the problem. 

In San Francisco, where two-thirds of people rent because of high prices, the authorities also have radical plans to get building again. 

Why, then, is this government, despite its rhetoric, so pathetic about building more homes? Are ministers that scared that Nimby baby-boomers will turn against them if more green belt is built upon? 

They should worry more about losing the trust of a younger generation whose dreams are being broken.

Shameful indictment

The Financial Reporting Council’s report into PwC’s audit of Sir Philip Green’s collapsed BHS group is sensational.

It rips Green’s accountants, Steve Denison and PwC, to shreds, claiming they made ‘incomplete, inaccurate and misleading’ statements about BHS’s financial health hours before it was sold for £1.

The detail is gripping – that Denison spent just two hours auditing the books in the months up to the sale, and failed to review the work carried out by a colleague with only a year’s experience. Every trainee accountant should be given a copy of the report the day they start work.

 

(function() {
var _fbq = window._fbq || (window._fbq = []);
if (!_fbq.loaded) {
var fbds = document.createElement(‘script’);
fbds.async = true;
fbds.src = “http://connect.facebook.net/en_US/fbds.js”;
var s = document.getElementsByTagName(‘script’)[0];
s.parentNode.insertBefore(fbds, s);
_fbq.loaded = true;
}
_fbq.push([‘addPixelId’, ‘1401367413466420’]);
})();
window._fbq = window._fbq || [];
window._fbq.push([“track”, “PixelInitialized”, {}]);



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here