The UK Housing Market is in dire straits and something has to be done about it.
While the UK Government is busy pretending nothing is happening, millions of people are about to see mortgage payments double, destroying household budgets and engulfing the country in financial misery.
Here I share some thoughts, along with Damien, on where steps could be made to at try and mitigate the situation we're in.
Go to Damien's channel to see how we got into this mess: https://youtu.be/eot6MjTuOB4
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Hi guys, I'm not Sasha But don't worry the boring guy who says a lot, he'll be with us any second while we wait for him. I Think we should quickly talk about the housing market I Don't know if you noticed, but it's a bit broken I Know it, You know it. chat GPT knows it I mean a mentally challenged sloth can see it even Sasha seems to be aware today. Damien and I are teaming up to look at solutions for the housing crisis.

It is of critical importance that we sort this out. High Housing costs and the amount of money people have to pour into just keeping a roof of their heads stops them from spending in other areas of the economy. Adding to the stagnation this country feels. if we don't do something, this is only going to get worse.

The Ons forecast that the number of household in England is projected to rise to 26.9 million in 2043, an average increase of around 150 000 households per year every year. And this doesn't include the millions of homes that we need just to catch up after Decades of falling short and failing on house building targets. But it's not good enough to just whack up a load more homes and be done with it. After the 340 000 homes a year we need to build all the 300 000 of the government has plucked out of thin air.

145 000 of these almost half need to be affordable homes. As the saying appears to go on this channel, it's helpful that no one actually knows what the affordable home is. the House of Commons Library themselves acknowledge there's no agreed upon definition such as the lack of consensus over what affordability means in housing terms. It's been suggested that the concept should be abandoned because it's unhelpful, um, affordable, uh uh, homes program.

But what does it mean? No one knows what it means, but it's provocative. No, it doesn't But we can probably all agree that affordable housing isn't City Center High-rise luxury developments with swimming pools, gyms in a 24-hour concierge. So how do we fix this once and for all? Because even though every major political party makes promises to attempt to tackle this issue, this is a problem decades in the making that will require a raft of changes to resolve. I Just dropped another video on my channel where we cover how we got into this mess and we'll link that in the description below.

Okay, so I'm not going to offer a definition of what affordable is, but let's say the housing crisis can be summed up by the fact that the average person in the UK can no longer afford to live in the average home. Just ask Sam An average looking bloke and in a very average income of 30k looking to rent the average flat in East London only to be told that he's too poor for affordable housing according to the government. Sam is a peasant and instead of living in a home, he can just go himself. I Mean that's one way of putting it.

Another way is that the requirements that landlords put on affordable housing is they want people to earn between 35 and 60k a year. So broken is the system that a person on sixty thousand pounds a year. this is an income that their Institute for Financial Studies describes as so high that you lie beyond the far right hand side of this chart. this chart being the distribution of incomes in the UK.
So that person who's off the chart fits the bill for affordable housing. but someone earning the UK national average income is deemed too poor to live in an affordable home. Foreign? Well, Then the solution seems simple, right. build more homes, increase the supply, and bring down prices for all by increasing the amount of homes available to rent and buy.

But of course, in the UK it is far from that easy, artificially constrained by A Relic from the middle of the 20th century. That is how a white paper from the UK government describes the UK's planning system, which is the major roadblock in the UK's way. when we aim to build more homes, it doesn't matter one bit what the government says in terms of building targets or the Manifesto promises, if that does not translate to Spades in the ground at the local level. The problem with the UK system is it is discretionary.

There is no certainty in any application whether it's going to be approved or not because it's a case-by-case system. If you know the right people, the right things can happen and if you don't, the right things may well not happen. Applicants essentially write a letter to Santa and go to the Local Planning Authority with a begging Bowl praying and asking for the permission to build. Even if you get past that hurdle, well, it doesn't really matter because then at every stage of the application process, you will be vetoed by basically anyone giving great power to Nimbyism at the local level.

from people who probably understand the need to build new homes, understand that it is necessary somewhere, but just don't want them build specifically near them. Any attempt to remove these blocks has just Fallen flat on its face because the problem is compounded at the political level. While the Conservatives may have a desire to appease younger voters who struggle to get on the ladder, they also need to protect the best interests of their homeowning older voters, leading to all plans to reform planning never getting off the ground. I Mean just ask Rishi Who Parked Planning reforms and building targets when he stepped into number 10.

to fix the housing crisis, we need to fix planning and the way we do that is by removing the uncertainty and this discretionary case-by-case basis for approval. Local targets for house building should be set and a zonal process could be implemented marking out areas where you can build homes, retail, and public services in. Mainland Europe A developer can be pretty sure that if their plans meet local plans and no set up by central government and they comply with building regulations, they're likely to be approved. Reforms to this side of the system are imperative.
if we ever hope to actually hit building targets. make it easier to build on Brownfield sites introduce incentives or punishments to push developers to build on land Banks instead of just sitting on them. All of these measures can help the UK hit a house building Target for the first time in decades, but will that suddenly fix the affordability problem? Probably not. The UK Government thinks that the UK needs to build 7 million homes in the next 20 years if the government hit their target of 300 000 homes of 340 000 homes or whatever that latest made up number is.

Oxford Economics modeled the impact of reaching the building Target on prices and found that a sustained building of 310 000 homes a year only produced a five percent decline in the Baseline forecast of prices going forward. Not really going to help all that much, is it? Yes, small homes are needed and that will help, but it's not a magic solution and it will only work together with macroeconomic policy to bring house prices down relative to incomes in the future. The decline in interest rates over the last couple of decades, especially the Rock Bottom rate environment we've had since the financial crisis, has done far more to house prices than this supply and demand debate. The cheap debt we've all got far too used to magnify the impacts of constrained Supply by allowing people to pay more and more for existing housing stock, pushing prices ever higher.

And really, the only solution to this issue 2 is a reversal of that. Trend The economists say that a drop of five percent can come from house building, but the Bank of England says another 20 can come from jacking up interest rates and keeping them higher for longer. This process should have already happened over a decade ago, but the Bank of England decided to sit there with their thumb up their ass, too scared to increase rates and rock the boat while the going was good. According to the Bank of England, you make hay in the winter because the summer is for partying and drinking champagne instead of millions of homeowners seeing their mortgage payments double in 12 months.

We could have spread this effect out over the last 15 years. Now look at this point, we can talk about tax reforms, go back and forth on planning, but really, the thread that weaves this whole mess together the nimbies, the lack of Supply, the impact of low rates, all of it is the national obsession with Rising house prices and the idea that the home you live in is or should be your biggest investment. 62 percent of people in the UK own their own home while only 18 invest in stocks and shares. The average pension pot average retirement is 55 000 pounds.

Most people retire with very little in Investments or savings. They've just spent their whole lives investing in their home before hitting retirement and having to sell and then downsize. And that smaller house they buy is still really expensive. Feels good saying that out loud because even though your house price went up 10, so is everyone else's You're not winning relative to anything.
We're all just collectively spending more of our salaries on our mortgages. We're the only winner here. really. Being the bank, an investment of 300 000 pounds would have produced about thirty thousand pounds a year in growth.

If you take the average of the global stock market over the last 100 years, this money is liquid. You can access it when you want for whatever you want Reason: If you lose your job, you can use that investment to plug the Gap until you find a new job. If you have an unexpected expense, you can go and get some money. If your mortgage payment doubles, you don't have to go home unless you can weather the storm because you have Investments What does 300 000 pound equity in your house do? Nothing? You can't access it without first getting the approval of your bank manager and paying thousands and fees.

And if things go south and you lose your job, your bank isn't exactly going to let you put more Equity out of your house. The rising rates recently have shown a light on this by turning millions of people into debt slaves forced to funnel every spare Penny they've got into the exact same property Everyone should aspire to have a paid off home like you should look to feed yourself or clothe yourself. Shelter is an essential, but the long-term trends of fall in Supply and decline in interest rates have led to this nation looking at their house as something it's not and that needs to change if we ever hope to solve the housing crisis. Thank you!.


By Stock Chat

where the coffee is hot and so is the chat

29 thoughts on “The uk housing market collapse – do this now”
  1. Avataaar/Circle Created with python_avatars Olivia Andrea Szabo says:

    Affordable should mean. No more than 5-6 yearly "real disposable income". That is even more simple. It's called median cash equivalent, after tax, ctax, utilities, food and staples, per worker per year. THERE YOU GO, BOYS! 😀 That we can call Real Affordability

  2. Avataaar/Circle Created with python_avatars Linguist Engineer says:

    err… stop immigration?!

  3. Avataaar/Circle Created with python_avatars Razza Mattaz says:

    Two huge flaws in your future ideas. Zoning laws can easily make the problem worse. Just look at America. The other issue is you saying stocks and shares. Sp500 os full of zombie companies living off of cheap debt. All the recent upwards movement was based on AI speculation. Finally, the BRIC organisation is making a solid effort to switch to gold, destroying the petro dollar. Unlike Iraq and Libya, I doubt the USA will roll tanks into Russia and China.

  4. Avataaar/Circle Created with python_avatars IntoMotivate says:

    People forget the government don’t want to more houses, they all have property portfolios and want the prices high.

  5. Avataaar/Circle Created with python_avatars Macca says:

    Thatcher created this problem , rite to buy scheme , FACTS

  6. Avataaar/Circle Created with python_avatars Seldom Seen Dave says:

    The government needs to stop residential properties being purchased by corporations as investment vehicles. A house is a home.

  7. Avataaar/Circle Created with python_avatars Kelvin Johnson says:

    It is difficult to make exact projections for the housing market as it is still unclear how quickly or to what degree the Federal Reserve will reduce inflation and borrowing costs without having a substantial negative impact on demand from consumers for anything from houses to cars.

  8. Avataaar/Circle Created with python_avatars Mark says:

    Hi Sasha and Damien, thanks for your video. What do you mean "DO THIS NOW" ? Your viewers won't be able to change the planning system!? So your title is a bit misleading.
    I'm an older homeowner and landlord and wasn't able to buy my first property until I was 30 years old (20 miles from where I was working) so I know how hard it is for younger people to get on the property ladder. The problem is that younger people aren't educated on how to make money by our school system. The education system is designed by our government to enable the average population to get a job to work for the rich who own a share in the business they work for. Firstly, your own home is a LIABILITY because it does not generate any income. Secondly, if you are earning £30k in London you can still afford to buy a home in Newcastle and rent it out whilst still living in London. You can eventually build up your own property portfolio over a few years and use the capital to buy a property in London. So maybe you should focus on how to financially educate people rather than fixing our corrupt political parties (Tories & Labour).

  9. Avataaar/Circle Created with python_avatars Stephen Bailey says:

    I've always seen my house as a home. Not an investment. I purchased the house I needed rather than stretching to buy space I wouldn't use. That allowed me to build my pension and investments and allowed me to survive the bad times.

  10. Avataaar/Circle Created with python_avatars Tako Chiba says:

    One thing missed here. You are right that investing in a house instead of something like shares means your money is not growing. But what is missed is the collective consequence of everyone making this mistake.

    Collectively, the amount of money trapped in everyone's houses is huge. If that money was released like getting invested in business, we could have good things from these businesses then investing back into the UK. Particularly important due to the decline in private investment that we have seen.

  11. Avataaar/Circle Created with python_avatars Saxon Stacker says:

    Stop the boats.

  12. Avataaar/Circle Created with python_avatars Teresa Hall says:

    Also, I get really sick of the doom stuff. The situation is grave, but your almost hysterical pitch is unwelcome.
    Plus, I noticed that "the government " seems to be your solution to everything.
    Well, the government is there to legislate. Let's start with laws that protect the rights of who benefits from taxation and ensure that everyone pays their dues. For every taxpayer, there's a freeloader. The unemployed, the "sick," the travellers, the lost in the black economy, the drug dealers etc etc. Let's focus on the real bad guys for a moment

  13. Avataaar/Circle Created with python_avatars Shelley Jane says:

    I work in finance in a housing association providing social housing and shared ownership properties. There's a solid definition for "affordable" properties in our line of work. We are allowed to build a certain amount of houses classed as affordable and those will be charged at 80% of market value rent. The grants we get to build stipulate what type of properties we can build. Affordable properties, being dictated by the level of private rents in the area, are always more expensive than Social rents – which are worked out based on average incomes. Affordable properties allow us to make a little more money which goes to the other community operations we undertake, like supporting people in they're homes. We do affordability checks with tenants before they move into a property to make sure they can sustain their tenancy.

  14. Avataaar/Circle Created with python_avatars KerrBearrxo says:

    What's the point in building all these homes if no one can afford them anyway?

  15. Avataaar/Circle Created with python_avatars Born To Rent says:

    *when housing debtors make crying videos on utube 😪

  16. Avataaar/Circle Created with python_avatars Dave Waterman says:

    System is corrupt from tip to toe
    Let it all collapse
    A Pyrrhic victory

  17. Avataaar/Circle Created with python_avatars Jack Alltrade says:

    There are many inflationary pressures on the housing market beyond those described. It is not just a supply and demand matter.
    Both Norman Lamont and Gordon Brown raided the pension funds huge investment pots that hey had built up against a forthcoming spike in retirements.
    This rendered pensions less attractive. Many turned to housing as a safe investment haven.
    In the eighties there was a shortage of rental housing. The Conservative govt. had sold off a lot of council housing under right to buy and were ideologically opposed to councils building housing. They thought that they could get a free linch by introducing the buy to let mortgage. The idea was that small investors would borrow to build new rental housing. This did not happen. Instead some of the existing housing stock transferred to the private rental sector.
    Buy to let should be scrapped. It provides no social good.
    Joint mortgages were introduced allowing working couples to afford more expensive homes than would previously have been the case on a single income.
    This had an inflationary pressure as the price that buyers could pay significantly increased with the increasing entry of women into work. This also has the effect that many women are compelled to work and prevented from being full time mothers which may previously have been a choice.
    Scrap joint mortgages. This has a deeply negative effect on house prices, the birth rate and a right to family life.
    Net immigration. A growing population exacerbates supply issues. The govt. is powerless to stop this.
    Air B and B. Some homes are now bought by investors specifically as Air B and B lets.

    Second or third holiday homes.
    Bought simply for recreation and restricting available housing stock particularly in essential economic sectors such as farming and fishing. It is possible to reduce this problem with local taxation snd planning laws.
    Foreign investors.
    Many new homes are sold off plan to foreign investors either to let or simply left empty as an investment vehicle. Many are offered and advertised abroad specifically.
    Legislation is required to prevent this.

    So from the above it can be seen that numerous steps could be taken to cause some deflation of the housing market but will not and can not be undertaken by a Conservative government because of the vested interests that fund the Conservative Party.

  18. Avataaar/Circle Created with python_avatars Werner Gurr says:

    I like the solutions you are proposing and think they would certainly help but they are of course anathema to the Tories currently in power. I am wondering – Would aproaching the EU with the aim of regaining freedom of movement help? Houses in most other countries in Europe are much cheaper than in Egnland so if pensioners sold their house in the UK they would then have all of Europe to look for better priced homes. Switzerland is not in the EU but in the Schengen zone and bilateral treaties between CH and the EU ensure that Swiss citizens enjoy freedom of movement. So this might be a solution for the UK too without having to rejoin the EU.

  19. Avataaar/Circle Created with python_avatars Scotty says:

    Unending increased demand for housing is mostly due to mass immigration, much of which is illegal immigration and very high birth rates among immigrant communities.

  20. Avataaar/Circle Created with python_avatars Scotty says:

    Please make a video about 'rent allowance' or 'housing benefit' now paid as part of Universal Credit.
    These houses would be occupied anyway, but rents would reflect market value and not be determined by government. Housing Benefit is really landlord and or banks benefit, keeping house values artificially high. Billions £££ every year, since 1970. Taxpayer funded mortgages and property portfolios.
    End all this with 10% reduction in payments every 6 months until zero. Allow market to dictate rents. Save taxpayers billions £££.

  21. Avataaar/Circle Created with python_avatars Jibster says:

    Bad video lmao. Completely ignoring the obvious demand increase in this supply demand works of economics

  22. Avataaar/Circle Created with python_avatars Jibster says:

    It’s supply demand but with immigration. Increase demand, increase supply. Don’t increase demand, supply won’t increase. only looking at one aspect of this issue is intentional ignorance and doing no good. The WHOLE housing economy in the uk should be looked at, not just what the government have done wrong. Ask, why are they doing things wrong?

  23. Avataaar/Circle Created with python_avatars Heathcliff Flowen says:

    Why are you only looking at the supply side of this equation? Where does the demand come from?
    What about the fact that over 600,000 people come to live in the UK from abroad each year. If each of them need a house, then we must build 1,600 houses a day just to keep even. Even if they share 3 to a house, that's still 200,000 houses a year, every year.

    All solutions are worthless in the face of this.

  24. Avataaar/Circle Created with python_avatars Simon Abbott says:

    You will own nothing and be happy

    W.E.F W.H.O

  25. Avataaar/Circle Created with python_avatars RF Burns says:

    What crisis? Houses where I live are cheap! £150k buys a nice 3-bed semi with gardens, a driveway, and a garage 🙂

  26. Avataaar/Circle Created with python_avatars Bergerac Van Damme says:

    Planning law? You think the problem is obstructive planning law?? Jesus Christ 😂

    If you average out the net immigration numbers of the last 20 years, Britain has imported enough new people to populate a city the size of Plymouth, every year, for 20 years, and still have enough left over to fill another, slightly smaller city!
    Arguing that we just need to build more houses is both deluded and extremely myopic, even more so when immigration numbers are only increasing significantly year after year. How many more Plymouths can we build? And then when we need to build a whole new Leicester or Newcastle each year just to accomodate the even higher immigration, what then?
    Even as it stands right now we'd need to be completing one new house every 5 minutes, 24 hours per day, 7 days per week, 365 days per year, just to keep pace with the demand from immigration!

    Even worse, you can be born in this country to a family whose ancestors can trace their British roots back almost 1,000 years…yet you'll be bottom of the pile for housing allocation whilst someone who's just broken into the country by paying human traffickers several thousand pounds to taxi them over from France gets top priority.

    It's insane, and I'm so sick to death of the lengths of delusion, denial and mental gymnastics that some will go to just to avoid confronting the huge elephant in the room. I swear some people would rather find themselves living in a 1 bedroom flat on the 40th floor of a high-rise in a country of which every last square foot has been paved, concreted and tarmacked over…just as long as nobody can accuse them of being a xenophobe when they suggested that perhaps, just maybe, endless, vast artifically created population growth may be the issue 🥴

  27. Avataaar/Circle Created with python_avatars stephen hartley says:

    good job i didnt get a mortgage. obvious scam.

  28. Avataaar/Circle Created with python_avatars SpiderDijon3 says:

    Another great video guys, however I find myself disagreeing with you on the planning point. While not perfect, the planning system ensures that every available area of spare land is not covered over with sterile concrete jungle. Currently 2.69 million people are not within easy walking distance of green space – this number grows massively when planning is relaxed. Developers will cram as many units as possible without breathing space – it is in there interest to do so.

    I have seen first hand how the recent loosening of policy (e.g. allowing commercial to be converted into resi without Planning Permission) has lead to horrific, cramped and substandard accomodation being built & let by unscrupulous developers, interested in cash profits over building decent communities.

    On another note & back to property prices – a compounding issue is global money buying up UK real estate as investments. The government should substantially increase the stamp duty on these purchases – this kind of investment does not benefit the UK economy, rather leetches money out.

  29. Avataaar/Circle Created with python_avatars Nathan Swindon says:

    its immigration

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