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Comment by Marazan | Hacker News Reader

It's because post GFC the USA stimulated and the EU went all in on austerity.

It is fairly clear what was the best option.

Under-rated comment. This is basically the whole explanation. 2008 did a huge amount of damage, not just immediately but to long-term mindsets. Ironically I think it's even entrenched the meme that the only real way to make money in the UK is property. We're all Georgists now.

(this includes property as an export industry! Leaving increasing areas of the UK owned by overseas absentee landlords.)

The problem is that people think property is a risk free way of making money - even if they borrow heavily to invest. Maybe what we need is a property price crash.

I'm not sure a property price crash would achieve this goal.

You will have to decide for yourself if I'm speaking from experience or have motivated reasoning, as I'm saying this as an overseas absentee landlord who bought a UK apartment around the tail end of the previous price crash, initially as a place to live in until I decided the UK wasn't for me any more, and was rich enough to do so without a mortgage.

(I left the UK in 2018 due to a mix of Brexit and technological incompetence in the form of the Investigatory Powers Act. Would have left UK sooner but for parent with Alzheimer's).

Reason being: the income from housing doesn't have to come from reselling houses (which a price crash would impact) — I'm collecting rent, not flipping property. Forecasts future increases to rental rates suggests it won't keep getting worse (relative to general inflation) than it already is for renters, but it's already obviously quite bad.

I feel deeply sad having to ask this, but... how did you manage to leave?

In 2018 the UK had not officially completed the process of leaving, so I found a spare room in Berlin, got on a plane and flew, did the initial paperwork for registering with the various things that need to be registered in Germany, and went job hunting.

Just before the actual cut-off date for customs controls, I had the stuff that had been in storage (loft of family house) shipped over.

In the UK it more or less is a risk free way to make money. The government's hand is always seen when a danger to the property market prices hoves into sight.

>Maybe what we need is a property price crash.

What is needed is a steady decrease in demand or an increase in supply.

The cost of living crisis is directly caused by the huge bureaucracy needed to build new housing. And speculators are benefiting from that. As long as governments are unwilling to let go of regulations housing costs will only increase.

There is no appetite for increasing supply anywhere in the West. Maybe Trump will get us into WWIII and we can shift the demand curve.

>There is no appetite for increasing supply anywhere in the West.

Every single person who currently is looking to rent or buy a house has appetite for increasing market supply.

None of those people have enough political power.

In Germany it is somewhere around 55% of the population.

In Germany lifelong renting is seen as a normal and acceptable thing to do, not a temporary stepping stone which will hinder you from achieving your life goals.

No it is not. A house is just totally impossible to finance with the average salary of two people, especially if you have children or a car.

In the US, it's a lot less than that.

Nearest we came was ... 2008, with all that implies. I don't think we can have a property price crash until the population starts net-declining.

We could start applying capital gains tax to a primary residence.

The UK did not choose austerity:

https://commonslibrary.parliament.uk/research-briefings/sn06...

but still has worse growth than the US.

The UK government did, for all intents and purposes, choose austerity after the pandemic: https://en.m.wikipedia.org/wiki/United_Kingdom_government_au....

They most certainly did

https://en.wikipedia.org/wiki/United_Kingdom_government_aust...

What they didn't do, unlike PIGS, was also tough reforms which are paying back now

https://www.reuters.com/breakingviews/flying-piigs-nations-s...

The Conservative party used austerity rhetoric as a way to win votes, but they did not cut spending other than reversion to the mean after the high spending around 2008.

See here for international comparison of government spending as % of GDP (the second figure showing trends over time), UK is not an outlier:

https://www.imf.org/external/datamapper/exp@FPP/USA/GBR/CZE/...

Can you explain how your link supports your argument?

The conservatives ran austerity-based policies for the last 14 years. Is your argument that they did not have a choice?

Have you seen the national debt under the conservatives? It's massively increased.

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