And as with so many modern issues, the housing problem was largely created by Thatcher - her Right to Buy policy.
The people don’t want housing built near them and the politicians listened. Lower supply than demand for decades leads to steadily rising prices. If you want to see the alternative look to Tokyo, Austin or Seattle. Build so much housing that the returns on investment are low and people can afford housing.
I think it's mainly a symptom of the unusualy low interest rates over the last 20 years: people have invested in residential property not because they particularly want to be landlords, but because it's perceived as the easiest way to get a better return on your money than a savings account that pays near zero interest.
I know of more than one person who's now looking to sell their rental property because they found out the hard way that "landlord" is actually a job title, not just the name of their savings account, that properties need to be maintained and that letting agents will find a way to swallow the vast majority of any profits.
I also know more than one person living in rented accommodation with appalling maintenance lapses. One had a shoddy roof repair last year which left the gutter missing. When the next rainstorm caused water to cascade down the outside wall and flow in above the back door, the letting agent had the nerve to shrug and say "old properties do that".
Another had a rotten wooden lintel above a street door scraped out, filled with expanding foam and painted over.
I think that it's important to note that the UK, Ireland and California have similarly destructive planning processes which end up ensuring that only property with high margins gets built.
- artificially low interest rates (since 1990, and esp. since 2007)
- exemption from capital gains tax for primary residence, which is the main reason why property is used as a pension scheme
- mortgage interest tax relief which makes debt tax efficient; phased out in the UK, but still available in the US
https://en.wikipedia.org/wiki/Home_mortgage_interest_deducti...
I'm just repeating stuff I've heard. A lot of it feels like unintended consequences.
The NIMBYism part seems pretty clear.
If others have ideas, sources, rebuttals, please share.
I will bash Maggie all day, for her refusal to effectively manage industrial decline in Britain, for her boneheaded belief that a top-ranking economy could exist solely on services, and, most of all, for her idiotic squandering of our North Sea oil wealth. But, Right to Buy was a rare hit for me. I see it as having been a forward-looking policy which aimed to reward people for work -- play the game, and you too can have a tangible slice of society in the form of your own home to possess and care for as you wish. The problem is that we didn't replace the social housing lost to RtB.
We didn't fail that - Councils wanted to build more social housing with RtB and Thatcher viciously destroyed those programs. She created RtB not because it was a "forward-looking policy aimed to reward people for work" but because she hated the social security apparatus and wanted to destroy it. And she was never covert nor apologetic about it.