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The problem is lack of supply vs demand. In 2022,England and Wales: - built 254000 homes[0] - had 745,000 people immigrate (net)[1] - had 600000 people turn

The problem is lack of supply vs demand. In 2022,England and Wales: - built 254000 homes[0] - had 745,000 people immigrate (net)[1] - had 600000 people turn 21[2] - had 577160 people die[3] If you gain a load of people, far more than you increased dwellings for, prices will go up and dwelling size will go down. It's not particularly complicated. [0] https://www.savills.co.uk/research_articles/229130/357082-0 https://www.savills.co.uk/research_articles/229130/357082-0 [1] https://www.bbc.co.uk/news/uk-politics-67612106 https://www.bbc.co.uk/news/uk-politics-67612106 [2] https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/livebirths/datasets/birthsummarytables https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde... [3] https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/deathsregistrationsummarytables/2022 https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde...

rcpt 2y ago
UK also has the Council Tax which is arguably a stupider tax policy than California's Prop 13
- walthamstow 2y ago
  And stamp duty, which is even worse
tmnvix 2y ago
> The problem is lack of supply vs demand. My point elsewhere in this thread is a that demand is not entirely a function of demand for homes (what I would call 'natural' demand). Finance and tax incentives play a large part too - encouraging demand for investment properties that are often not used as homes (what I would call 'artificial' demand). This is not to say that addressing supply through more building is not helpful, just that there are other things to consider that may not require as much effort and can have broader economic benefits (e.g. changes to the tax system to encourage productive rather than unproductive investment, credit guidance, etc).
- robertlagrant 2y ago
  > demand for investment properties that are often not used as homes Could you elaborate? How often is "often" in the context of the whole country? > This is not to say that addressing supply through more building is not helpful, just that there are other things to consider that may not require as much effort and can have broader economic benefits (e.g. changes to the tax system to encourage productive rather than unproductive investment, credit guidance, etc). If the UK is gaining enough people to require multiple cities the size of Oxford to be built each year to accommodate them, it would be surprising to find that the main issue is people are replacing houses with other buildings.
  - tmnvix 2y ago
    > Could you elaborate? How often is "often" in the context of the whole country? According to this document (https://www.oecd.org/els/family/HM1-1-Housing-stock-and-construction.pdf https://www.oecd.org/els/family/HM1-1-Housing-stock-and-cons...) 10% of dwellings in the US are 'vacant dwellings and seasonal/holiday homes'. In other words these are not owner-occupied - and what I would classify as investment properties. Now these are not all the investment properties, obviously. There are many investment properties that are permanently tenanted. Assuming that about 65% of homes in the US are owner-occupied, then we should be able to assume that the remaining are investment properties (remember I include holiday and second homes here). That means about 30% of investment properties are not used as homes (i.e. the 10% mentioned earlier). Investors are removing a lot of dwellings from the permanent housing stock. It is worth keeping in mind that when you hear references to a 2% or 3% vacancy rate, this usually means the percentage of dwellings in the permanent rental market that are currently vacant - not the percentage of total dwellings that are vacant.
pcrh 2y ago
On the other hand: There were an estimated 28.1 million households in the UK in 2021, an increase of 6.3% over the previous 10 years. [0] and: The UK population at mid-year 2021 was estimated to be 67.0 million, an increase of 3.7 million (5.9%) on the population in mid-2011.[1] So the number of UK households increased by slightly more than the population between 2011 and 2021. [0] https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/families/bulletins/familiesandhouseholds/2021 https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde... [1]https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/bulletins/annualmidyearpopulationestimates/mid2021 https://www.ons.gov.uk/peoplepopulationandcommunity/populati...
- robertlagrant 2y ago
  I think that's part of it - houses are chopped up into two flats, or are registered as HMO[0]s, so more people are living in the same space. That's what I meant by "dwelling size will go down", above. This also drives up prices, as two flats will sell for more than one house would've, given the current lack of supply. [0] https://www.gov.uk/private-renting/houses-in-multiple-occupation https://www.gov.uk/private-renting/houses-in-multiple-occupa...

rcpt 2y ago

UK also has the Council Tax which is arguably a stupider tax policy than California's Prop 13

walthamstow 2y ago
And stamp duty, which is even worse

tmnvix 2y ago

> The problem is lack of supply vs demand. My point elsewhere in this thread is a that demand is not entirely a function of demand for homes (what I would call 'natural' demand). Finance and tax incentives play a large part too - encouraging demand for investment properties that are often not used as homes (what I would call 'artificial' demand). This is not to say that addressing supply through more building is not helpful, just that there are other things to consider that may not require as much effort and can have broader economic benefits (e.g. changes to the tax system to encourage productive rather than unproductive investment, credit guidance, etc).

robertlagrant 2y ago
> demand for investment properties that are often not used as homes Could you elaborate? How often is "often" in the context of the whole country? > This is not to say that addressing supply through more building is not helpful, just that there are other things to consider that may not require as much effort and can have broader economic benefits (e.g. changes to the tax system to encourage productive rather than unproductive investment, credit guidance, etc). If the UK is gaining enough people to require multiple cities the size of Oxford to be built each year to accommodate them, it would be surprising to find that the main issue is people are replacing houses with other buildings.
- tmnvix 2y ago
  > Could you elaborate? How often is "often" in the context of the whole country? According to this document (https://www.oecd.org/els/family/HM1-1-Housing-stock-and-construction.pdf https://www.oecd.org/els/family/HM1-1-Housing-stock-and-cons...) 10% of dwellings in the US are 'vacant dwellings and seasonal/holiday homes'. In other words these are not owner-occupied - and what I would classify as investment properties. Now these are not all the investment properties, obviously. There are many investment properties that are permanently tenanted. Assuming that about 65% of homes in the US are owner-occupied, then we should be able to assume that the remaining are investment properties (remember I include holiday and second homes here). That means about 30% of investment properties are not used as homes (i.e. the 10% mentioned earlier). Investors are removing a lot of dwellings from the permanent housing stock. It is worth keeping in mind that when you hear references to a 2% or 3% vacancy rate, this usually means the percentage of dwellings in the permanent rental market that are currently vacant - not the percentage of total dwellings that are vacant.

pcrh 2y ago

On the other hand: There were an estimated 28.1 million households in the UK in 2021, an increase of 6.3% over the previous 10 years. [0] and: The UK population at mid-year 2021 was estimated to be 67.0 million, an increase of 3.7 million (5.9%) on the population in mid-2011.[1] So the number of UK households increased by slightly more than the population between 2011 and 2021. [0] https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/families/bulletins/familiesandhouseholds/2021 https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde... [1]https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/bulletins/annualmidyearpopulationestimates/mid2021 https://www.ons.gov.uk/peoplepopulationandcommunity/populati...

robertlagrant 2y ago
I think that's part of it - houses are chopped up into two flats, or are registered as HMO[0]s, so more people are living in the same space. That's what I meant by "dwelling size will go down", above. This also drives up prices, as two flats will sell for more than one house would've, given the current lack of supply. [0] https://www.gov.uk/private-renting/houses-in-multiple-occupation https://www.gov.uk/private-renting/houses-in-multiple-occupa...