What effects have the growing levels of property prices caused on its surrounding frameworks and society itself together with capitalism? 25

I’m in Ohio and the housing market here over the last 7-8 years is unlike anything I’ve ever seen. Homes that were bought for $130K in 2015 are now being sold for $590k. I’m talking about tiny, disgusting, poorly built 950 square foot [censored] boxes in quiet mediocre neighbourhoods. Then you’ve got Better, average sized homes in nicer neighbourhoods that were $300K+ 10 years ago selling for $750k+ now. Wild times.

He talks about demand without talking about supply. In places where people actually want to live, e.g. London, Cambridge and Oxford, it's effectively impossible to meet the demand because of the restraints of the planning system.

As usual, any conversation about house prices comes down to the lack of a Land Value Tax. Had the UK managed to pass the LVT bill in 1905 this country would be vastly richer and more equal than it is today. But it was killed for the same reason we are unlikely to be able to fix it now, the rich who own the land will do anything to stop LVT.

It's not a double income issue. It's the home ownership consolidation, and I would say feudalisation.
Renting keeps people poor because they can not build their own wealth by having property. Instead, they invest it all in third party.

The problem isn’t that dual incomes have increased house prices, they are still around 3x salary. The problem is the second income can be used to buy a property to rent out. And once that property’s mortgage is being paid by the renter, you can go buy another property. And unlike homes that get sold on as people upscale or downscale, these never return to the market. I’ve seen rental prices in one area double simply because all the properties are snapped up by three landlords.

The big element, thankfully, Mr Sutherland understands is that Land is not Capital or a Product (including Adam Smith, David Ricardo, John Stuart Mill, Karl Marx, Winston Churchill, and J.M Keynes, to name a few heavyweights i.e. economics is Land (Rent), Production and Capital). It's unique as it cannot be created (product) and is not capital as its value is the rent it creates via scarcity and production value of fertility, place, and time. Land is the domain of Rentier Capitalism (ref; Brett Christophers, Thomas Piketty r>g, Mariana Mazzucato) that extracts wealth from the incomes of production, whilst adding no value to society, only to the rentier landlord, who does nothing but collect rent!

So TLDR of his argument is:
- when working families have 2 salaries their disposable income grows
- all people need shelter/housing
- when you limit the supply of housing (mostly zoning/other regulations) the price of a house will rise, because it's an essential good

So the law of supply and demand. With limited supply for something essential the price would go up.

1) We should have a tax for city center apartments that are not in active use. Owner should either rent it or sell it, not use as a safe haven for your money or keep it empty for years on end.
2) We should forbid companies or investment companies from owning residential housing in cities (designated areas for residential housing)
3) Illegal immigrants should be housed in a tent with water, soup and bread. They can then return home or learn the local language, values, get a job and integrate. Not to be housed in city hotels and apartments on tax payer money
4) welfare customers should not be allowed to live unemployed near the city center for over 10 years. Either get a job or forced to move to a cheaper city as normal people do.
5) We need to start cutting the ridiculous red tape that adds on to the cost of new housing.

House prices keep going up due to bank and government money printing. People borrow excessively to buy a property because cash is getting devalued every year. People use property for a store of value rather than for it's utility. While money printing continues scarce assets will continue to go up. Buy Bitcoin and keep it for longer than 4 years you will thank your future self.

Three points that I would like to make. First, forty years ago the largest element in monthly mortgage payments was to cover the interest which was typically 15 per cent. The capital element was more modest, and therefore so were house prices. Now, and for nearly 20 years the interest element has been much smaller than the capital element as a result of, especially since 2008, extremely low interest rates. Second, the single hospital consultant in my area (Cumbria) earns much more EACH YEAR than the average house price. How therefore does the gentleman's argument stand up? it only does so if one lives in an area where house prices are high. That is not the case for much of the country, although for the London area and the southeast, as well as in regional large city centres and suburbs (but not always in towns within one hour's commuting distance) it is. London is a special case, partly because of large influxes of overseas-derived capital.

Third, even forty years ago buying a property was a struggle for young people. Without help from relatives, one had to fill a flat or house with paying flatmates, sleep for years on the sofa in the communal living room oneself, work in two or three jobs for 100 hours a week for years and to forego holidays and cars (and indeed, do all of the above). One suspects that many in the younger generation are not prepared to do thus. I will not say if that is good or bad but it is probably a reality of life that many overlook when they tut-tut about the UK housing situation.In the wider context and perspective, people should at least try to focus on making something of their situation rather than wallow in professional victimhood. Vicarious professional victimhood is worse still, and nauseating to witness.

What's occurring is completely predictable. The purchase of housing occurs in an unregulated capitalist market insofar as if you can purchase a property, there is no restriction on how many properties you can purchase. If you extrapolate an unregulated capitalist market to its logical endpoint, the end result is that one entity will eventually own the entire market. What you'll see is initially the smallest / poorest players in the market get priced out of it first, but over time bigger players will get eaten up. Eventually a point will come where one entity has so much dominance in a market they can use their market power to crush every other player in the market. This is what we're seeing in the housing market. People of low socio-economic status have been priced out of the housing market for quite a long time, but we're now starting to see the middle class get squeezed out of the property market. And it will only get worse until radical change occurs. Residential housing should only be available to buy to people who want to live in the house. If people want to be landlords and rent properties out for commercial gain, then only property designated as commercial should be available for that.

Supply and demand is the biggest factor, 8 million added to the population has made everything worse, and another 10 million expected by 2040 will see a city of tents, Britain is dead.

two incomes isnt the CAUSE of high housing prices but an effect.
housing prices went up entirely due to government restrictions on home construction causing a shortage of supply. they do it on purpose and sometimes even ADMIT that their regulations are intended to "maintain high property values". keeping high property values means they are ON PURPOSE putting in place regulations to drive up housing prices. so if the city planning commissions admit they are doing this, why do we refuse to blame them for it?

Not just land issues.

I remember when I worked at HPES they talked about ‘Total Addressable Wallets’ as in we knew the UK Gov had x to spend on IT contracts so we had to get as much as we could out of them including simply doubling the prices I’d worked out for my service.

Now the UK is offering grants of £7.5k for Heat Pumps so suddenly all installs costs £10k+

They costs a lot less in the Nordics where wages are higher and they need better installations!

Greed.

He is indirectly referring to Land values being reduced to make housing affordable and not being held by leasehold landlordism, which raises the price of freehold land to match yields gained from production wealth (wages). How do we kill land values? 1) Rent control is sanctioned by a government freeze for 4 years, and then local rent controls are sanctioned by local authorities relating to local incomes. (it worked from [protected]) 2) A stop/go policy of controlled finance for mortgages to stop land inflation, with mortgages being the scarce factor, not land. Yes, it means waiting for a mortgage, but would you rather pay in today's money between £200,000 -£600,000 more for an average house that is purely the commodified element?

The conjecture of this is the end of state welfarism to asset welfarism which is great if you have an asset; if not, you're screwed, and that is now the old unskilled working class and newly educated middle (who don't have a bank of Mum and Dad, who are now the 10th biggest lender in the country for property).

Bubble residential prices are not unique to the UK. Parts of the USA, Canada, NZ and Australia are experiencing the same inflated prices. What those countries have in common, apart from those conditions mentioned in the content, is long-term low interest rates. Cheap long-term money. Another driver is cash... buyers who benefited from the inflation can afford, after sale, to buy their next property for cash. Immigration is also a factor.

I have to disagree, the reason house prices have increased is due to supply and demand not because owners were taking advantage of couples having more income. Local authorities were building over 150,000 house per year averagely since 1947 right up until 79 when there was a massive decline to almost no local authorities building houses by the end of the decade. Combined with private firms the UK was building more than 300,000 house per year for over 25 years sometimes hitting 400,000 houses in a year. Since 79 it dropped to 200,000 and below, some years not hitting 130,000 all private. We have had a very sharp increase in population. Demand is up, supply is low, they know how much we have and the very people who we elected to look after our interests are invested in taking the most from us. Not one government since 79 has been overly concerned with what works best for all and what works best for a country's long term economic growth. Spending the rest of your life paying more than three times what something is worth to a banker who created the money out of thin air and does nothing for your money but say yes. And then the government may take it from you in the end to pay to look after you. Imagine our booming economy if we were not giving half our income to pay for the roof over our heads. In the 1980s, it was 4.2 times income, now it's 8.8 times income. Back then, it was just 12% of your income. If it was that way now we would be eating out, doing up the kitchen, etc. A stolen future, and who stole it? The people who voted for her and her children.

I usually like him, but his analysis completely misses out the artificial constraints of the planning system (which was introduced specifically to constrain development), population growth without increased construction, and the movement of wealth from true investment to rentierism as a result of government overregulation of investment, alongside the legalisation of buy to let mortgages, Brown's pensions raid, availability of cheap credit since the early 2000s, artificially low interest rates (which are still historically low) and quantitative easing since 2008.

It's impossible for any UK government to do anything seismic with housing. None of them can implement sweeping reform, even if they somehow were able to overrule local authorities, because you have a huge cohort of voters who own houses - or at least have large mortgages - and don't want to see them devalued. A party that promised to level off house prices, or worse - reduce them - to make them within the realms of mere mortals to buy, would be soundly voted out at the next election. On top of this you have people who are quite happy to pull the ladder up behind them. People talk about wanting more houses built, but when they've got their own house they object to any being built nearby. It's no surprise people get more big C conservative as they get older, as their attitudes coalesce towards supporting "I'm alright Jack" policies and parties.

Too many people forget very easily that it was never easy to buy a home. Now prices are high(er) and interest rates are low. Forty or so years ago, prices were much lower but interest rates payable were like 15 per cent. That is where the money went. Much that is now talked about house prices/affordability is rubbish. Outside cities like Leeds, Sheffield, Newcastle and Manchester, an hour's commute or less away, decent two-bedroomed late Victorian terraced houses cost only £100,000 or so. Easily affordable at today's interest rates. Much whining goes on which may apply to London and the southeast but that area is self-centred in the extreme and utterly divorced from the reality of other parts of the UK. In addition, today's spoiled, entitled youngsters generally are not willing to take in flatmates or housemates for a few years to help in the early days of property ownership. They have been spoiled by mum and dad treating them like gods and goddesses. Nor are they prepared to work 100 hours a week for some years to make the dream a reality. That is what my generation (I am now 70) had to do if we did not have rich parents. And, we did not whine either.

The real reason for unaffordable housing is that investors snap up all the cheaper properties on cash deals. Small buyers can't compete and are thus forced to rent the house they should have bought.

I am surprised that little seems to be spoken about the Great Housing Gold Rush during Covid...

I was trying to buy a place to live from December 2019- July 2022.
it was crazy, places being sold within a very short period was a regular thing .. prices pretty much went up 40% over those 2.5 years...

I went from looking at 2 bed houses to one bed flats, where i was looking (South Coast).

The thing about rivalrous chasing of assets is that, yes, that's very true. But the reason it's driven prices up so extraordinarily is that the supply of new housing has been suppressed by zoning and other regulations. In the United States, the 2008 financial crisis is the inflection point: we simply haven't built enough housing since then, especially but not only in the most highly desirable and booming areas.

Not exactly. "Homeowners" don't determine how much someone will pay for their house if they sell it, the buyers do. People/couples with higher income don't care about paying more for a house -- that is, they don't hold prices down -- so house prices rise, which creates the demand to earn more income, which drives more women into the workforce, which perpetuates the cycle. Add inflation, a debt-based economy and social status pressures and now we are where we are.

How is this an improvement in quality of life?