Saturday, 11 August 2012
Buy-to-let repossessions at record high
The housing market is far from being functional and efficient. It is severely distorted by regulation driven by lobbyists which want to preserve key urban land value in the hands of super rich and influential. London - the economic engine of Britain - has the biggest and the most crooked housing market. The housing gap and the price disparity is the most shocking in Britain.
Apartment blocks need to be built in London and in other centers with high housing gap. The supply will both increase the access to buy to own and rental properties. Crucially, it will improve the living standards of hundreds of thousands of households.
The lack of buy to let regulation makes the rental market in the UK a disgusting mockery. People live under ground like rats or squeezed in attics. Wardrobes or storage cupboards are converted into "coquette" bathrooms or kitchens. People can touch their ceilings in properties worth half a million pounds! Landlords can shrink and shrink properties and increase the yield per square meter. They call this astuteness, and they believe they are entitled to a guaranteed profit since they have the money to get a buy to let mortgage. I call this government ineptitude.
The housing market is dysfunctional and inefficient. Increase supply, apply building and renting standards and cut nimbyistic behaviour.