With the Evening Standard running a piece this week on homelessness doubling under Boris Johnson, Lucy Tobin decided it would be a good time to issue a self assured decree to Londoners that they should give up on their dreams of owning a house. You can read the article here, but here’s some of the salient points she raised and my reply:
Previous generations obviously benefited from a house price boom that created millionaires and jerked the housing ladder somewhere closer to the clouds than to solid earth for us young ’uns. But we can’t change that. There’s no way to knock a zero off every asking price on Zoopla. A housing market is just that, based on supply and demand.
So yeah. Tough shit. Don’t call for rent controls to push buy to let cowboys out of the market, don’t ask for more affordable housing or second homes to be taxed more. There is literally no example of supply and demand being tampered with in this area. Lucy Tobin said so.
Oh except that’s exactly what the government has done. In the three years between 2011 and 2014 the government will spent 35 billion in welfare towards rents in private housing. Most of this goes to pay for people who are in work because the market has priced them out.
Figures in the billions are thrown around a lot today but to add context this amount is about two and half time what will be spent on job seekers allowance across the same period. There is a huge subsidy for anyone entering the buy to let game – the idea this is a simple “supply and demand” area is bogus.
So why is she happy for there to be no intervention in the housing market? Well maybe it’s because she’s just got on the housing ladder herself.
As it is, my husband and I secured our half-share of one last year, in an outer, cheaper surburb (sic) of London, after saving for a decade.
Sorry to get petty and personal for a second but there are a few things I’d like to point out here:
1) Having crossed over at uni with Lucy I happen to know that she graduated in 2008. So according to her she’d already been saving for a house while at school – an opportunity not many have without reasonably rich parents. The below picture might explain her extraordinary feat of saving though.
2) It’s nice to use (sic) against someone being so pompous – even if my pieces are littered with their own mistakes.
3) Lucy has previously explained she grew up in London and was able to stay with her parents after university. She was thus able to save and still have access to London’s job market: The uncertainty of the job market meant I couldn’t consider renting, and working as a finance journalist I soon realised that staying at home and saving was the only way I could ever afford to share a mortgage. If you’re not from London you don’t have this luxury – but Lucy still claims you have to put up with the high rental prices she avoided.
The whiff of privilege doesn’t end there though as she compares her plight to those of her friends who are renting:
By contrast, our renting friends are all in Zone 1 or dotted around West Hampstead and Dalston and Clapham
This proves little other than that Lucy has wealthy friends. It escapes her notice that most people cannot afford to rent in Zone 1 and that perhaps the experience of renting a property in Hampstead might be different in rougher areas of the capital. Many people’s lives are ruined by immoral slum landlords but she proceeds with her rose tinted view of the renting experience, citing the benefits such as being able to get home quickly.
She doesn’t explain why if it’s that good she chose to buy.
Lucy’s got no time for charities trying to help in this area either:
(C)alls from Shelter and others for the Government to “do something” are vague. The state has already pumped cash into the house-building industry.
It’s unclear if she has read the Shelter website as it’s hard to go a few clicks without seeing them pushing for more affordable housing, though admittedly this is more vague than her call to do nothing. Also the state has not “pumped” money into building affordable housing. In any case the industry is clearly not suffering for money – problems like allowing local councils to build without private company intervention go much more of the heart of the issue.
She concludes in an unfortunately smug mode:
In the real world, where there are no pastel-coloured peg children, we live in a great but expensive city — and there is no right to buy.
The article is totally confusing. On the one hand she’s right that the older generation did get a boost and used this both personally and through companies to buy up more property. In many cases they borrowed against the asset they couldn’t afford in the first place to get a buy to let property, and now the young ‘uns (both through their rents and taxes) are paying that loan off for them. She even laments her own position of only being able to afford a box. She then concludes this is how it should be.
There are only two explanations. The first is that Lucy has Stockholm syndrome. The second is that now she is on the ladder she thinks she might get a piece of the action.