High housing costs costing London £3bn a year

Graham_Devon

Looks like even business is now starting to complain about high costs of living and the accommodation shortage in London.

The article also leads us back to something that's often cropped up on this forum. Many suggest that money going on rent could be going elsewhere and feed into the economy. However, on the flip side of that many suggest it is fed into the economy via the landlord. This does not appear to back up that assertion. It's obvious to me that 30 people spending money in the local economy is better than one person spending it.

London’s housing crisis will cost the capital almost £3bn this year in lost consumer spending, according to a major new study on the economic impact of the homes shortage.

Crippling rents and mortgages in the capital – where house prices have doubled in a decade – will result in the “unnecessary” loss of £2.7bn from the consumer pay packet in 2015, according to research carried out by the Centre for Economics and Business Research (CEBR).

In a second article today, figures have been released of the amount of young people leaving london de to high living costs. It's described as a "place to work, not to live".

More than two thrids of renters in London are leaving to go buy a place somewhere else.

Article one:
http://www.telegraph.co.uk/finance/economics/11925071/Revealed-The-3bn-cost-of-Londons-housing-crisis.html

Article two:
http://www.telegraph.co.uk/finance/property/11925580/The-exodus-of-homebuyers-from-London-hits-epic-levels.html

Seems we not only have a problem - but appears it's not just the little man suffering now - it's business too.

CLAPTON

Graham_Devon wrote: »

Looks like even business is now starting to complain about high costs of living and the accommodation shortage in London.

The article also leads us back to something that's often cropped up on this forum. Many suggest that money going on rent could be going elsewhere and feed into the economy. However, on the flip side of that many suggest it is fed into the economy via the landlord. This does not appear to back up that assertion. It's obvious to me that 30 people spending money in the local economy is better than one person spending it.

In a second article today, figures have been released of the amount of young people leaving london de to high living costs. It's described as a "place to work, not to live".

More than two thrids of renters in London are leaving to go buy a place somewhere else.

Article one:
http://www.telegraph.co.uk/finance/economics/11925071/Revealed-The-3bn-cost-of-Londons-housing-crisis.html

Article two:
http://www.telegraph.co.uk/finance/property/11925580/The-exodus-of-homebuyers-from-London-hits-epic-levels.html

Seems we not only have a problem - but appears it's not just the little man suffering now - it's business too.

accountants not economists


if things are 'too' expensive in London relative to other places then the inevitable will follow to the benefit of all.

Thrugelmir

Graham_Devon wrote: »

Seems we not only have a problem - but appears it's not just the little man suffering now - it's business too.

Is it all bad news though. HSBC is transferring 1,000 jobs to Birmingham. Isn't a less London centric economy better for the UK?

gadgetmind

Quite a few organisations, both public and private, have relocated their head offices (or substantial chunks of their organisation) to near me in the grim North. They do cause surges in house prices, what with not knowing the value of money and all that, but it's generally a good thing.

lisyloo

Isn't a less London centric economy better for the UK?

Absolutely.
Doesn't seem to having a huge effect on the ground though.
Parts of the North still lack opportunities and infrastructure and London is still very overcrowded (I don't just mean housing, I mean public transport as well).

We need both more investment elsewhere and also less overcrowing in London.

movilogo

Not just house price, train fare to London is robbery as well.

Now the wealthy Arabs and Russians will realize that they can buy multi-million pound properties in London but nobody will remain there to wash their backsides in the toilet

Thrugelmir

lisyloo wrote: »

Absolutely.
Doesn't seem to having a huge effect on the ground though.

Perhaps that's because things take far longer than people allow for. A 1,000 people move involves a lot of planning and organisation.

lisyloo

Good point, but also just 1,000 is a drop in the ocean.
It needs to become more of a trend.

gadgetmind

GOK how long it took and how much it cost to move various government departments to "The Kremlin" in Leeds.

https://en.wikipedia.org/wiki/Quarry_Hill,_Leeds

It's kitted out with gym, squash courts, swimming pool, deep pile carpets, expensive artwork, and everything else you'd associate with the public sector.

http://www.independent.co.uk/news/uk/home-news/bureaucrats-stay-in-the-pink-1511377.html

Conrad

No mention that plenty of people ride the property escalator and then use some of the equity to realise all manner of enterprise both home and abroad.

Thrugelmir

lisyloo wrote: »

Good point, but also just 1,000 is a drop in the ocean.

99% of businesses in the UK are SME's. Of these 96% only employ between 1 and 9 people.

So change isn't going to be noticeable. Will be gradual. Just like the growth of digital technology in Manchester. Centres of excellence take a while to build.