To my local MP:- c.c. Rt Hon. James Brokenshire MP, Secretary of State for Housing Communities and Local Government

The Housing Crisis (2)

The objective of this posting is to try and put more roofs over the heads of those with lower incomes in the presently challenging rental housing market.

The rents landlords obtain should be decided dependent upon true market conditions not by the landlords themselves (or indeed by their agents). The fact that so many local tenants find these too high to afford, strongly suggests that the marketplace is not functioning correctly. The correct solution would be to enhance the method by which rents are arrived at, in the individual local marketplaces where they are generated.

The problems with rent levels, actually go back as far as the ‘right to buy’ regime in the 70’s and even before that. Councils and government cannot realistically pretend that the PRS (private rented sector) is now to blame when the markets in which they are operating, are themselves malfunctioning and have been for years.

The PRS has in point of fact performed a vital role in propping up the rental sector pending the supply of replacement municipal housing to assist those whom are in need and currently unable to provide for themselves. Meanwhile unfortunately, hardly any replacement social housing has been provisioned to replace what has been lost in sales to sitting tenants!

The same failings are also affecting price-setting of all houses currently being sold today and the finance industry is complicit in facilitating that. These, like local rents, are becoming progressively over exaggerated.

For more on this please see:
The House Price Virtuoso Solution: Full details of our proposals for properly reforming all housing markets in England and Wales

Here, we explain in more depth why these problems exist and precisely how they may all be resolved.

An example of the sluggish performance of central government is in reforming residential leasehold tenure in the housing markets.

More and more owners with leasehold interests are now finding these becoming depreciating assets owing to the doubling of ground rents by landlords. Because of this these leasehold interests are worth less and less!!

This is a further reason, highlighting the need for central government to take swift and direct action to resolve these crises within all the local housing markets across England and Wales.

I respectfully ask the government to institute such action quickly.

Peter Hendry, Author:– The House Price Virtuoso Solution otherwise known as The Hendry Solution

David Dimbleby’s Question Time, BBC 1, 3rd May 18, The broken housing market.

As was emphatically stated in David Dimbleby’s Question Time on BBC 1 10:45pm on Thursday the 3rd May 18, the housing market in England and Wales is completely broken.
Martin Lewis, a panel member and founder of Moneysupermarket.com voiced similar conclusions during the show.

The only way new buyers can get onto even the first rung of the ladder is to save upwards of £50,000 when joint salaries are in the majority of cases well below such an amount.
This, coupled with the fact that with interest rates staying so low for so long, while buyers are working to build such a nest-egg, the value of their savings is diminishing all the time they are saving.
With inflation running at over double the interest which is capable of being earned, savers are having to battle against the interest tide just in order to stand still!

The clear message is, housing has now become too expensive to remain attractive to first timers. Total annual completed sales of houses have taken a dive as a result. This is a form of housing poverty as so many simply cannot afford to house themselves and their families, based on their current earning abilities.

What we are clearly seeing here is deja vu.

A similar pattern and situation presented itself after the end of the First World War and the Housing Act of 1936 was government’s response. It intervened to deal with the acute lack of sufficiently well equipped housing by usually clearance orders to have substandard housing demolished and new and better quality properties built on the land released.

Government action was the catalyst which dealt with the need at the time.

A fairly similar scenario in history occurred after the Second World War as once again, the government acted as a catalyst to deal once again with substandard housing using the Housing Act of 1957 to clear property which was deemed uninhabitable and uneconomic to upgrade to a habitable and acceptable standard.

In both cases, in concert with dealing with unsatisfactory standards, significant numbers of new housing, particularly municipal / council property was built at huge cost to the exchequer.

This was instrumental in holding house prices stable at the time.

The problem today is that since there have been no more wars involving our country, a very welcome situation of course, there has been little incentive for government to wish to involve itself a third time in dealing with the current housing crisis.

But; there is quite plainly little point in administering similar medicine a third time as it is also plainly evident that doing it has not permanently mended the nation’s housing market.

Instead what is needed (in addition to a program for constructing lots more housing within the private sector but crucially also in the public sector), is a logical and reasoned overhaul of the way in which each local housing market around the whole country actually functions.

Instead of allowing vendors simply to pitch asking prices at any amount they happen to consider feasible, more research is needed when determining the correct and finely-balanced level of price in the marketplace concerned. To achieve this would involve a root and branch reform of estate agency as we currently know it.

The way this could be done would be to re-orientate agency so that it primarily serves all the buyers instead of working solely for the sellers as happens at present. Smoothing out house prices using this method would have a dramatic and permanent stabilising effect everywhere – just what is now needed to stimulate new buyers to save and buy at prices within their financial reach.

For a full explanation of exactly how this may be accomplished, please follow the link to:

Improve The Housing Market in England and Wales.
How to Improve the Housing Markets in England and Wales before it is too late.

Peter Hendry, Author:– The House Price Virtuoso Solution otherwise known as The Hendry Solution

Latest government funded research into the crisis within the housing markets across England and Wales

Here’s news (published in February 2018) on the then recent government funded research into the crisis existing within the housing markets across England and Wales.

An awful lot remains to be done to assist those wanting (and needing) to start buying their first houses or flats and thus later to be able to move to better accommodation as and when, and wherever, they may need to.

The Economic and Social Research Council have funded the recent research through the Secondary Data Analysis Initiative (grant number ES/N011872/1) and the Centre for the Microeconomic Analysis of Public Policy at the IFS (grant number ES/M010147/1).

The online link to the IFS research is:
https://www.ifs.org.uk/uploads/publications/bns/BN224.pdf
The decline of homeownership among young adults.

The IFS are so right about the decline in home ownership. It’s a societal loss.
I have worked on producing a policy designed to resolve the current problems within all housing markets across England and Wales.

In my opinion there is only one certain way to resolve this dilemma. It’s my latest online blog-published explanation covering this and taking you on to the actual virtuoso solution which may be found at the following link.

The House Price Virtuoso Solution.
How to Improve all Housing Markets in England and Wales.

Peter Hendry, Author:– The House Price Virtuoso Solution otherwise known as The Hendry Solution

It’s an earnest attempt to be a useful contributor to the future prosperity of our still great nation.