Some of our friends just outside London are moving overseas and putting their two-bed house up for rent. It was bought in 1999 for £80 and now has a market value of around £185k. The had three different agents round to view the property and all three were trying hard to convince them to put it on the market - 'It may remain empty for a while, Sir', 'We're short of homes for sale', 'We could sell this for you in two days'.
The area is short on ALL forms of housing - rental or for sale - at ALL price points, but is this a sign that the buy-to-let bubble is slowing up? I hope so - it's almost weekly you hear young middle-class couples ranting about the theft of housing stock by but-to-letters with an almost Sons of Glyndwr-type zeal.
Whatever is going on, 'the market' is doing a pathetic job at providing what's needed. Ok, it's not just 'the market' - NIMBYs, the British obsession with living in a dolls house on a green-belt chewing Barratt estate rather than a good flat, the aversion to medium-rise shops-at-the-bottom european style building doesn't help either as you can't make best use of the available space. Even so, 'the market' round here seems to like creating an oversupply of bland office blocks on land ripe for housing - office that simply sits empty for an age - and the odd 'exclusive developments' of boxy two-bed flats for 250k plus. The council just waves it all through, no problems...
I read in the paper last week than the CBI are even getting in on the 'houses are too expensive' act. Seems their members are having trouble getting staff and keeping them.
Another article I saw also stated that south east firms are having trouble finding staff due to the cost of living all the way up to 30k and more - 30k workers don't want to live in a putrid dive, or face a mammoth commute. And gone are the days where any number of positions with salaries below a living wage could be filled by ex-students living at home, or housewives returning to work.
This all certainly rings true. I've now worked at two south east companies where people earning from 13-25k were simply treading water, planning their moves up north or overseas, sick of doing demanding jobs only to spend half their incomes renting sub-standard housing. Surely, productivity nosedives when barely any member of staff feels they can either live on the money, or have the lifestyle their work and skill-level should provide? Morale takes a beating. Organisations based in London and the South East will have to put up with people 'getting a bit of experience' and then moving on at the earliest opportunity.
If we look to even unluckier individuals, the housing crisis is another Blairite stab in the back to honest, everyday people. Council/Social housing is now non-existent for working people as it's all been sold off. You have to be unemployed, have kids, be mentally or physically ill - and even then you'll face a long wait to be housed. This gives you the situation where £750 after tax workers are forced to pay £350-400 for bedsits or houseshares - the kinds of people that once might have been able to access social housing. The lack of social housing keeps rents high, as people are forced to pay inflated 'market rates' and hand over an unjust portion of their tiny incomes, thus promoting poverty and making it harder for people to save and better themselves.
Solving this NuLabour mess is no longer a matter of arsing about with interest rates. It needs serious input.
d.