Stephanie Flanders on QEIII or whatever you want to call it

Wookster

BobQ wrote: »

That will help the economy? THe government should cut out the middle men who have failed this country (the banks) and loan money to the construction industry to build affordable housing for sale or rent. Then they will know that the economy is being stimulated. THey can do the same with some infrastructure products too.

The problem is that prices are too high which filters into land prices as well. If house prices fall, land prices will adjust as well making it cheaper to build property which will in turn lead to more properties being built and sold.

Graham_Devon

HAMISH_MCTAVISH wrote: »

Mr Muddle strikes again.

What Flanders said, that I agreed would be a good idea.....



Ad here's what you said, that I noted would be so unlikely as to be verging on impossible....



And here's why.....

-It would cost 50 billion or so in direct government expenditure. This isn't monetary policy, it's direct fiscal spending, and would increase the deficit this year by 50% or so.

-It wouldn't save a penny in housing benefit. Those houses still have to be paid for.

-With the average housing benefit claim at just £86 per week, you couldn't service the debt needed to build them, even at the low rates the government pays for debt.

-If you think a Tory government will build 300K new council houses, then you're delusional.

Your calling me Mr Muddle, while pretending that the private sector wouldn't build the homes on behalf of the state?

Give over Hamish.

Thrugelmir

Wookster wrote: »

The problem is that prices are too high which filters into land prices as well. If house prices fall, land prices will adjust as well making it cheaper to build property which will in turn lead to more properties being built and sold.

Land is the issue. The cost of building can fall. As a high % is labour not material.