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One response to my housing paper in recent days has been 'nobody agrees with you so you must be wrong!'
housingevidence.ac.uk/wp-content/upl…
But in fact similar opinions have been shared by many economists recently on 3 core points:
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housingevidence.ac.uk/wp-content/upl…
But in fact similar opinions have been shared by many economists recently on 3 core points:
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1) There isn't a growing shortage that can explain national prices rises
2) Falling interest rates inevitably push up prices and are the primary culprit
3) Building 300k won't help reduces prices much or soon
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2) Falling interest rates inevitably push up prices and are the primary culprit
3) Building 300k won't help reduces prices much or soon
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First of all the government's own @mhclg model confirms that growth in the housing stock per head has been sufficient to put *downward* pressure on prices since 1991 medium.com/@ian.mulheirn/…
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In The Times @PJTheEconomist wrote "Looking at the aggregate numbers of homes and households, it is pretty hard to make a case that there is a growing housing shortage" and pointed instead to flat real rents and falling interest rates thetimes.co.uk/article/if-wer…
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Edward Chancellor @Breakingviews and @andrew_lilico were making the case - based on volumes and rents - before me capx.co/there-is-no-uk… breakingviews.com/columns/chance…
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@sjwrenlewis argued that "If real interest rates fall but future real rents stay unchanged, housing becomes a more [expensive]" and consequently "the rise in house prices in the UK and France since 2000 has got little to do with a lack of house building" mainlymacro.blogspot.com/2018/02/house-…
At a @housingevidence seminar last December, David Miles presented a simple model to show how the recent fall in interest rates would be expected to result in huge price growth even when rents are flat (which is what we've seen)
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@AnnPettifor has argued that "It’s speculation in the property market that is fuelling stratospheric house price rises, not shortage of supply." theguardian.com/commentisfree/…
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And @L__Macfarlane @beth_stratford told a similar story in Labour's Land for the Many report labour.org.uk/wp-content/upl…
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As for whether 300,000 houses can ever be a meaningful solution, there's a high degree of consensus from the available literature - and the government's own model - that it can't medium.com/@ian.mulheirn/…
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None of this is to say that all these people agree with my paper.
But the three core propositions are far from heretical - indeed they're quite mainstream. What's surprising is the gulf between all this and the policy debate
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But the three core propositions are far from heretical - indeed they're quite mainstream. What's surprising is the gulf between all this and the policy debate
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