How will we afford houses in the future?

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Reply 40

Bang Outta Order

Original post by Reue

Move out of London. Plenty of cheap housing elsewhere in the country.

Portsmouth? Brum?

Reply 41

brainhuman

Original post by Observatory

I lived in London for four years, basically in one room. I lived in what was built as a family home and then subdivided into eight one-room apartments.

It would have made more sense to have demolished the whole street and built an apartment block with thirty or forty apartments on the same footprint.

Can't do that, it's illegal.

Even where it's not strictly illegal, the cost of obtaining permits and sitting on capital waiting for permits exceeds the cost of actual work, and that cost is passed on to tenants.

You are talking about replacing existing housing with high rises to allow for more housing in a smaller area.

Maybe. But does London want to turn into Tokyo?

Reply 42

Observatory

Original post by brainhuman

You are talking about replacing existing housing with high rises to allow for more housing in a smaller area.

Maybe. But does London want to turn into Tokyo?

No, which is the problem.

London would rather be a gingerbread village than a liveable city.

That policy can only last so long.

Reply 43

brainhuman

Original post by Observatory

No, which is the problem.

London would rather be a gingerbread village than a liveable city.

That policy can only last so long.

The point I was trying to make is that Tokyo is not a liveable city...

I guess people have different views and those deciding for the city have a different one to yours.

Reply 44

Observatory

Original post by brainhuman

The point I was trying to make is that Tokyo is not a liveable city...

I guess people have different views and those deciding for the city have a different one to yours.

Tokyo is far more liveable than it would be at low density. Of course you could also slaughter a few tens of millions of Japanese and get the best of both worlds.

Reply 45

brainhuman

Original post by Observatory

Tokyo is far more liveable than it would be at low density. Of course you could also slaughter a few tens of millions of Japanese and get the best of both worlds.

What is and what isn't "liveable" is not objective.

I live in Zurich. I guarantee you, that while house prices are similar to that in London (with probably not as large a high end as in London due to lack of vast rich foreigners buying up things) it is far far more "liveable" (in my eyes) than either London or Tokyo.

Reply 46

Observatory

Original post by brainhuman

Yes it is pretty objective - how much living space and how far is it from where you want to be?

London is expensive because hugely more people want to live in walking distance to 20 minutes' tube ride of Z1/2 locations than there are housing units in such locations.

More housing units in those areas, lower prices. People like houses and gardens, but that ship has sailed, and the liveability difference between a 3rd floor and a 30th floor apartment is pretty much zilch. So, demolishing 3 storey house-shaped apartment buildings in Z1/2 and replace them with 30 storey apartment building-shaped apartment buildings.

Tokyo has a lot of housing units and high prices, because there are a whole ton of Japanese, but destroy housing units and you make the problem worse. Only way to "solve" this problem is to start eliminating Japanese.

Zürich is liveable because it's just a town. More people live in Bristol than in Zürich.

Reply 47

brainhuman

Original post by Observatory

So for you the only aspect of "liveability" is how ones flat feels?

Just no.

Reply 48

Observatory

That's not the definition I gave.

Reply 49

Imperion

Original post by DanteTheDoorKnob

Mate, a doorknob in London is like 10x the price of your mum.

Ouch... RIP whoever got told this

Reply 50

jamesthehustler

1-well gold is rising faster than houses
so there's an answer buy gold and let it's value grow sell it and buy a house
2-diamonds even faster still
3-leave london and other major cities
4-don't spend money on anything else but a mortgage

Reply 51

Youngmetro

Dont leave london, everything outside of london is just farms and countrysides and villages

For example, here is a genuine uber driver outside of london:

Reply 52

brainhuman

Original post by Observatory

That's not the definition I gave.

That is exactly the definition you gave when you said "living in the 30th floor is no different than living in the third".

Reply 53

spv

Original post by Drunq

Also, that's an average price, which means there are houses for a lot less than that.

The average priced 2 bedroom London house in absolute slums cost roughly 400k
You'll be paying roughly 600 for the 2 br in a slightly less slummy area.

It's expensive af in london, everywhere.

Reply 54

MagicNMedicine

Original post by Observatory

Housing shortage is a result of regulation restriction building and development. Those laws will eventually be reformed, although probably not until the situation becomes very desperate.

Exactly.

Much of the problem here is on regulation and lobbying to prevent planning permission.

The older generation were granted planning permission to build, and they were able to get houses.

Many of them have profited hugely from the increasing scarcity of housing as their house prices have increased, giving them the ability to purchase further property and rent it out, which has meant their lifetime wealth has increased far more than they would have hoped to earn in wages.

Now that older generation have been very vocal at lobbying government to limit planning permission so that others can't get on the housing ladder and to ensure they get ongoing price rises, all at the expense of the younger generation who are trapped renting for the long term.

The tipping point will be when this really starts to bite with Middle England. To a point Middle England families can just about survive this because young people with access to the Bank of Mum and Dad can get parental help to put down deposits or benefit from inheritance, but the fact the older generation is living longer and potentially needing more time in social care is creating a problem on inheritance: yes your parents might be rich but if they are say 25 to 30 years older than you, and they live till 90 or over then you're looking at inheriting when you are 60. That's no good for people with aspiration to own their own home and have a family. Besides, when you split the inheritance with your siblings and deduct what might have ended up going on paying for your parents' social care there might not be as much left as you hoped.

So we're going to see people from Middle England families who are getting in to their 30s and 40s, stuck renting in crappy conditions and they will be angry, and they will make up a part of the electorate worth listening to. That will be the point they start doing something.

The other issue is that there's a very real threat to the economy of London. Businesses pay a huge premium to locate there because there's a huge consumer market and a large pool of skilled labour because London is such a popular city.

However we're approaching a point where young professionals just find it uneconomic to live there and they will start moving away to other cities. Once the skilled labour goes, businesses will relocate quickly because it's much cheaper to operate out of another city. This could trigger quite a rapid downsizing of the city as businesses will respond quickly to the actions of their rivals so as not to be caught paying higher costs than them and becoming uncompetitive.

I think government is sleepwalking in to this a bit - at the moment they don't need to do anything because the skilled labour is sucking up the miserable renting conditions and paying 50 to 60 per cent of their wages in rent, but as the rent keeps rising (its about 10% a year at the moment), unless wages keep pace with that then people will just say it's better to earn a lower wage in Birmingham, Manchester, Leeds, Bristol etc.

Reply 55

JamesN88

This article sums it up perfectly. I know which one I'd chose.

http://www.dailymail.co.uk/news/article-3540852/Now-island-London-studio-flat.html

*apologies about the Mail link :smile:

(edited 7 years ago)

Reply 56

antipathy

Original post by MagicNMedicine

I think government is sleepwalking in to this a bit - at the moment they don't need to do anything because the skilled labour is sucking up the miserable renting conditions and paying 50 to 60 per cent of their wages in rent, but as the rent keeps rising (its about 10% a year at the moment), unless wages keep pace with that then people will just say it's better to earn a lower wage in Birmingham, Manchester, Leeds, Bristol etc.

Extremely well written post, agree with you on all points.

Interestingly, I'm currently doing exactly this - relocating from London to Leeds. As a Civil Servant, wage rises are capped at 1% until 2020 (And have been either capped for frozen since 2010). The cost of living is already exorbitant, but by 2020 rent costs will be completely unmanageable - hence seeing the writing on the wall and upping sticks now.

I've worked in Whitehall for a couple of years, and would have been happy to stay, but the cost of living differential is just too extreme. And it's not just about 'can' you live in London, it's about is the hit to living standards worth it.

Couples have it slightly easier, as they can use their dual incomes to out-compete singles for one bedroom flats. But if the choice is buying a nice house in Leeds, or renting a small room in a shared house in London, it's a no brainer.

The cost of adult social care is an absolute time bomb as well. The current system is entirely predicated on the assumption that a) Most people will own their houses outright when they retire, and therefore retirement incomes don't need to be high enough to rent privately, and that b) The majority can pay towards the cost of care by utilising their housing equity. With those assumptions gone, the benefits bill is going to skyrocket in 30-40 years.

(edited 7 years ago)

Reply 57

Daimonos

Original post by Reue

Move out of London. Plenty of cheap housing elsewhere in the country.

This tbh.

Unless you work in an industry that only exists in london in the UK (e.g. investment banking), if you can get the same kinda job in a different city you should.

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