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Workers claiming Housing Benefit nearly doubles in 3 years
Comments
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Domestic property rental is a pretty open and free market. There's no cartel of big corporations manipulating it. So it largely reflects supply and demand. In this country we have too many people, too many individual households, and not enough building land, combined with on the one hand people who would like to concrete over the south of England, if not all of it, and on the other hand the Nimbys. Rent controls would only make matters worse -- when they previously existed there was hardly any private rented accommodation in the UK. There is no easy solution, but immigration should be all but stopped in order to ease the pressure on housing (and many other things), and the state should discourage people having more than two children, instead of subsidising it. I agree with those who say as taxpayers we should prefer topping up people's rents with benefits to forcing them to become unemployed and having to pay it all.No-one would remember the Good Samaritan if he'd only had good intentions. He had money as well.
The problem with socialism is that eventually you run out of other people's money.
Margaret Thatcher0 -
The number of houses would not be reduced so why would this affect availability?
They would not just remain empty.
Yes they will. It isn't worth, for example, maintaining/doing up a run down house if you aren't able to make an economic return.
It's economics 101, lesson 1. If you put in place a price cap below market price then you will reduce supply to below existing demand and at the same time increase demand!0 -
Yes they will. It isn't worth, for example, maintaining/doing up a run down house if you aren't able to make an economic return.
It's economics 101, lesson 1. If you put in place a price cap below market price then you will reduce supply to below existing demand and at the same time increase demand!
That assumes a free market.
The existence of subsidies such as HB throws many of the economic "rules" out of the window.0 -
Yes they will. It isn't worth, for example, maintaining/doing up a run down house if you aren't able to make an economic return.
It's economics 101, lesson 1. If you put in place a price cap below market price then you will reduce supply to below existing demand and at the same time increase demand!
Surely if you put in a price cap, from today onwards, you'd in effect, be stemming price increases in property too. BTL landlords won't simply be buying up stock, competing with the FTB, UNLESS it makes economic sense taking the cap into account.
The lack of competition from BTL landlords, (letting to private individuals using taxpayer funds in a growing number of cases), should, in effect reduce house prices to a level real demand can play out.
I don't think anyones suggested imposing a cap below market rent, and I don't think anyone would suggest doing so retrospectively.
But, IMHO, you can impose a cap going forward, which wouldn't have the effects you talk of, as the cap would be known and planned for.
At least....it seems to work perfectly well in other countries, without the effects of which you talk of?0 -
Graham_Devon wrote: »Are you trying to water this down?
If you are, as it looks, then I'd just point out to you that not all of the newly created families will be working families (as it seems you believe), therefore this makes the numbers even more damning.
I only try to water things down when others try to beef them up. Of course, it makes sense that the more families there are and the less houses there are the more it impacts on rent, however, its a bit rich for all those on here hoping for a crash to wring their hands because rents have gone up when the very cause of this is their demand that house buying (and consequently building) become less attractive.0 -
In other words, of the nearly 1m new families created in excess of new houses built in the last three years only about a third have been workers who needed to apply for housing benefit?
those figures look dodgy, and are not compatible in any way with the ONS stats which show household size falling (if there really were 1 million more new families than homes then they would all have to share houses, pushing the household size up).
i am going to hazard a guess that they have used the gross number of new families and compared it to the net increase in residential dwellings.0 -
Graham_Devon wrote: »It's not a strawman, I'm just wondering what you are trying to say. I never stated "everyone" either, but it certainly seems to me that you believe these figures are made up mainly of people returning to work from being unemployed.
I'd say the figures can be accounted for by the increase in new household formation and the increased reliance on part-time work. i.e. new younger households finding full time employment difficult to find but also finding that part-time work is better than none at all.
Some will be full-time workers who have had to take part-time work but can now get housing benefit. Some will be unemployed people returning to work. I'd rank them in that order of significance.
According to the ONS there are 640,000 more people in employment than the same period in 2009. (October 2012 labour market stats vs October 2009 labour market stats). At the same time the number of people in part time work has increased 530,000.0 -
Twaddle.
Supply and demand theory is robust enough to be able to deal with subsidies, price floors, price caps and taxes.
Surely demand and supply theory does take affordability into account. HB in effect removes this element. Whilst this should not have a great effect, I believe that in some parts of the country (London) something like 30% of private tenents are in receipt of HB.0 -
Surely demand and supply theory does take affordability into account. HB in effect removes this element.
In the jargon of economists, housing benefit shifts the demand curve to the right. To translate, at any given price more can be demanded with housing benefit in place because it is a subsidy to a group of renters.
It's a market distortion but it doesn't throw the rules out of the window. The housing market is pretty free compared to many in the UK given the amount of red tape and coercive taxation around these days.0
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