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So here in the UK, our councils used to build social housing. 300,000 per year. And then Thatcher made it illegal and said privately owned housing associations

So here in the UK, our councils used to build social housing. 300,000 per year. And then Thatcher made it illegal and said privately owned housing associations would fill the gap. In the 30 years since then, the most they've ever managed is 30,000. It's not in private landowner's interest to build cheap social housing. It reduces rents, it suppresses property values. So they don't get built. If they do build anything, it's in their interests to build luxury apartments. They make the most money out of those. I know little about Berlin's housing, but by any chance would there be a lot of expensive apartments being built? Did something similar happen in German history? You'll probably find all the big landowners in Berlin and Germany lobbying very hard to make sure nothing like this ever happens.

Tenoke 6y ago
I'd take them building more expensive housing (as long as it's not used purely as an empty investment vehicle as in London) over barely building anything at all. I know people who would've paid a bit more for a nicer place but their options were too limited, so I'd expect some trickle-up/down effect at least.
- kokey 6y ago
  There is a point when you run out of people who are willing to spend millions on the empty investment vehicles so I'm hoping even those properties will help with supply when the tide eventually do go out. Unfortunately it could take a very long time before this happens.
  - mattmanser 6y ago
    Isn't it widely used for money laundering and wealth sheltering? Don't think there's an end to that money.
    - slavik81 6y ago
      An endless supply of money sounds like a great source of tax revenue. It's rather difficult to evade a property tax.
  - llampx 6y ago
    There are millions of chinese and other people who want safe investment vehicles. If the government does nothing, land and housing in a big capital can easily be usurped by investors who then take massive tax breaks.
    - CryptoPunk 6y ago
      Investors will profit most by renting out their property. Allowing the profit motive to work to increase supply is an effective way to reduce the price consumers pay in every industry, including the rental market. Profit is just an emergent form of social compensation for addressing a shortage. That society enacts laws to prevent the profit motive from working, and incentivizing socially beneficial behavior, is a tragedy.
- mattmanser 6y ago
  This "trickle-up/down effect" is the exact excuse they've been using to justify it. As far as I know, it's a widely discredited theory, never based on any actual studies.
turbinerneiter 6y ago
I know of some related things going on here: * Typically in Germany, social housing is built with a time-limit built in: after X years, the house falls out of the social housing program and can be rented and sold freely. At the moment, a lot more houses leave the system then are added. * Many cities sold their real estate after the financial crisis to give the money to the failing banks. I.e. Berlin is super-broke, in parts because of a big banking scandal of the previous government. * In Munich they have a pretty decent system: anyone who develops land had to keep to a certain split of social housing, middle income housing and free market housing. They use the land they own and their powers over zoning to enforce that.
luckylion 6y ago
Berlin and other cities sold off their public housing to pay for their budget deficits. Generally, there are housing cooperatives in Germany, and they have significant amounts of apartments. Not close to being as big as the largest private companies, but 3000-5000 apartments aren't rare. You become a member and buy shares, and their purpose is to provide housing to their members, they're very affordable and all around pretty great (not as profit-oriented as the private companies, not as bureaucratic as the public stuff). I'd prefer those over public housing very much because only with them, the interests between the renter and the landlord are aligned, and they're not part of the state and can therefore not be used (or sold) by political decisions.
raverbashing 6y ago
The dichotomy between "cheap housing" and luxury housing needs to end. (I might be wrong but) if I had to bet why councils could build more places it's that they would have a streamlined approval process with councils (denying a social housing project would look bad) while the private developers have to follow the mood of the deparments and several "appeals" and "NIMBYs" (same as in the US today) But a new "luxury apt" opens a place in a slightly cheaper property.
- deleted 6y ago
  [deleted]
killtimeatwork 6y ago
At least in Warsaw, there are various kinds of developers. Some specialize in luxury housing, while others cater to the mass market, with tall building of small-ish flats, hundreds of units per flat, built on cheaper land further away from the city center. There were entire districts built by such developers in the past 20+ years. Perhaps the key to this is relatively low regulation in Poland, which sadly results in somewhat chaotic urbanism and a lot of missed opportunities for building a city that's nice to live in, but also allows for shit to get done.
llampx 6y ago
Thatcher has been out of office since decades. If this was important to the people they would vote for people who promise to bring it back. Or politicians are corrupt and Thatcher is a good excuse. Take your pick.
- mattmanser 6y ago
  That's not how politics works in the UK. We have first past-the-post, so individual policies mean very little. On top of that, the Conservatives made an election pledge to build 200,000 starter homes in 2015 election and apparently failed to build a single one. It's easy to claim you'll build houses and then do nothing, like it's easy to claim you'll reduce immigration but it just keeps going up. The last election in 2019 was mainly about Brexit and the general public's perception that Corbyn was unsuited to being the Prime Minister.
stjohnswarts 6y ago
Same thing happens here in Austin, if you don't force them to also build affordable housing as part of their deal with the city virtually 0 will be build because the profit margins are so much more with luxury apartments that are 500 sq ft and you can fit a ton of them in a high rise.

Tenoke 6y ago

I'd take them building more expensive housing (as long as it's not used purely as an empty investment vehicle as in London) over barely building anything at all. I know people who would've paid a bit more for a nicer place but their options were too limited, so I'd expect some trickle-up/down effect at least.

kokey 6y ago
There is a point when you run out of people who are willing to spend millions on the empty investment vehicles so I'm hoping even those properties will help with supply when the tide eventually do go out. Unfortunately it could take a very long time before this happens.
- mattmanser 6y ago
  Isn't it widely used for money laundering and wealth sheltering? Don't think there's an end to that money.
  - slavik81 6y ago
    An endless supply of money sounds like a great source of tax revenue. It's rather difficult to evade a property tax.
- llampx 6y ago
  There are millions of chinese and other people who want safe investment vehicles. If the government does nothing, land and housing in a big capital can easily be usurped by investors who then take massive tax breaks.
  - CryptoPunk 6y ago
    Investors will profit most by renting out their property. Allowing the profit motive to work to increase supply is an effective way to reduce the price consumers pay in every industry, including the rental market. Profit is just an emergent form of social compensation for addressing a shortage. That society enacts laws to prevent the profit motive from working, and incentivizing socially beneficial behavior, is a tragedy.
mattmanser 6y ago
This "trickle-up/down effect" is the exact excuse they've been using to justify it. As far as I know, it's a widely discredited theory, never based on any actual studies.

turbinerneiter 6y ago

I know of some related things going on here: * Typically in Germany, social housing is built with a time-limit built in: after X years, the house falls out of the social housing program and can be rented and sold freely. At the moment, a lot more houses leave the system then are added. * Many cities sold their real estate after the financial crisis to give the money to the failing banks. I.e. Berlin is super-broke, in parts because of a big banking scandal of the previous government. * In Munich they have a pretty decent system: anyone who develops land had to keep to a certain split of social housing, middle income housing and free market housing. They use the land they own and their powers over zoning to enforce that.

luckylion 6y ago

Berlin and other cities sold off their public housing to pay for their budget deficits. Generally, there are housing cooperatives in Germany, and they have significant amounts of apartments. Not close to being as big as the largest private companies, but 3000-5000 apartments aren't rare. You become a member and buy shares, and their purpose is to provide housing to their members, they're very affordable and all around pretty great (not as profit-oriented as the private companies, not as bureaucratic as the public stuff). I'd prefer those over public housing very much because only with them, the interests between the renter and the landlord are aligned, and they're not part of the state and can therefore not be used (or sold) by political decisions.

raverbashing 6y ago

The dichotomy between "cheap housing" and luxury housing needs to end. (I might be wrong but) if I had to bet why councils could build more places it's that they would have a streamlined approval process with councils (denying a social housing project would look bad) while the private developers have to follow the mood of the deparments and several "appeals" and "NIMBYs" (same as in the US today) But a new "luxury apt" opens a place in a slightly cheaper property.

deleted 6y ago
[deleted]

killtimeatwork 6y ago

At least in Warsaw, there are various kinds of developers. Some specialize in luxury housing, while others cater to the mass market, with tall building of small-ish flats, hundreds of units per flat, built on cheaper land further away from the city center. There were entire districts built by such developers in the past 20+ years. Perhaps the key to this is relatively low regulation in Poland, which sadly results in somewhat chaotic urbanism and a lot of missed opportunities for building a city that's nice to live in, but also allows for shit to get done.

llampx 6y ago

Thatcher has been out of office since decades. If this was important to the people they would vote for people who promise to bring it back. Or politicians are corrupt and Thatcher is a good excuse. Take your pick.

mattmanser 6y ago
That's not how politics works in the UK. We have first past-the-post, so individual policies mean very little. On top of that, the Conservatives made an election pledge to build 200,000 starter homes in 2015 election and apparently failed to build a single one. It's easy to claim you'll build houses and then do nothing, like it's easy to claim you'll reduce immigration but it just keeps going up. The last election in 2019 was mainly about Brexit and the general public's perception that Corbyn was unsuited to being the Prime Minister.

stjohnswarts 6y ago

Same thing happens here in Austin, if you don't force them to also build affordable housing as part of their deal with the city virtually 0 will be build because the profit margins are so much more with luxury apartments that are 500 sq ft and you can fit a ton of them in a high rise.