Friday 30 September 2016

"Wealth of people in their 30s has halved in a decade"

From the BBC.

The IFS has crunched the numbers and confirmed what we knew all along - that the changes made to legislation on the housing market over the last few decades have really had the desired results over the last fifteen years or os, the desired result in this case being to f--- over future generations and enrich existing large landowners and banks.

Most owner-occupiers are superficially also winners in this, because "their homes have gone up in value" but that's illusory. It's purely paper gains and unless you own more spare homes that you have children, your family on the whole will end up worse off.

All this "bank of Mum and Dad" stuff illustrates the point. In most cases, Mum and Dad have to take out another mortgage to lend to their kids, on top of the huge mortgage the kids have to take it. So the family has approx. the right number of houses but massive great big debts.

Tuesday 6 September 2016

Reader's Letter Of The Day

From yesterday's Evening Standard:

Chris Roberts dismisses Rohan Silva's piece on housing costs by saying that "there are plenty of cheaper places to live than London" which misses the point.

Of course there are plenty of towns where the cost of living is £10,000 a year lower but in those towns wages are also £10,000 a year less. Any apparent saving in rent would be matched by a fall in wages.

To put it another way, half of all UK graduates move to London, attracted by the higher wages and better job opportunities, but landlords have simply increased their rents to soak up those extra earnings. Most of the official growth in the London economy ends up in the pockets of landlords or those who sell up and move away.

Younger people like Rohan Silva are caught between a rock and a hard place, and lucky Baby Boomers who bought their homes for a song 20 or more years ago should be thanking their lucky stars, not sneering at people who will have it so much harder.

Mark Wadsworth, Young People's Party