Right to buy is back, sigh…

4 thoughts on “Right to buy is back, sigh…”

1. Jack1, we are indeed in disagreement and many points raised by you are, imho, naive, but I still love you!

   There are some things which belong in a modern mixed democratic society’s public domain, and some that should be private.

   Thatcher had no philosophy to guide her other than a small minded conservatism and got the management of public resources horribly wrong. You have probably heard me going on about her sale of our water supply to overseas hedge funds and the electricity grid too! Blimey, she was a disaster for the British people!

   Thatcher’s use of the word “right” was cynical and party politically motivated, and I maintain, economically inept and morally wrong.
   She used tax revenues to favour the slightly better off and used their aspirational greed to grab votes. She mis-used North Sea Oil revenues too. If only she had had the wisdom of the Norwegian government! Sadly she had little wisdom, just lots of misplaced self confidence!

   You say Mr Greenspan acknowledged that lack of regulation was the problem, to which I say (quoting Mandy Rice Davis) “Well he would wouldn’t he!”. Remind me, who started to remove regulation? Ermm, Oh yes, Thatcher, followed on by an equally inept labour government.

   Lack of regulation was indeed a large contributing factor but your view that most bankers motives are honourable is laughable!
   Bankers are in it for the money – period. ‘Twas ever thus and will forever be so. When Thatcher, and later Brown, removed sensible regulation, the wolves just moved in and ate the sheep who were now unprotected from their cleverer predators.

   Publicly funded council housing stock should never have been sold off. It was a criminally incompetent misuse of public tax revenues for party political gain.

   You ignore, as do most political parties, the main reason for house inflation, which is over-population. Others are a lack of political will, both labour and tory, to replace the council housing stock that had been sold off and a need for the bank’s mortgage assets to be protected via quantitative easing. Without QE, here and in the states, many banks would have gone bust and property prices would have fallen to where they should be. That value is where a high earning young couple can afford to buy a small house without using the bank of mum and dad. Yes the economy would have nose dived for a few years but we would have started the climb back eventually and without so many bloated mega corporations stifling small business start ups.

   Sorry Jack1, we must agree to disagree on this point but let us savour that upon which we do agree!

2. There is a right to buy if legislation says there is. Rights aren’t simply earned they’re also decided by democratic institutions. Tenants’ rights must be balanced with those of landlords.

   Simple greed? It seems you mean “Tory greed” or that of “banksters” meaning bankers guilty of bad or immoral practices or crimes – a minority of bankers then. Some seem to think that the financial crisis that led to an economic one was caused by bankers in our era who were far less honest or more ingeniously manipulative than in any other period. I think majority opinion is wrong in this respect. Mr Greenspan acknowledged that lack of regulation was the problem. Nobody listened, but the gentleman admitted regulators were very much (if not entirely) to blame. That was what was different in the financial crisis, not the greed of bankers. “Banksters” is not a serious comment, unless you wish to be dismissed for “blogstering” and it is an insult to the majority of bankers who are as honest as you or I.

   It isn’t obviously right that people should hand over up to half their wages to a landlord year after year to the landlord’s largely unearned profit while the tenant is forever too poor to be able to buy a house for themselves. Some sort of right to buy after a number of years of responsible tenancy might be fair in some circumstances, though it makes less sense if it is to buy from a not-for-profit housing association and certainly not for only 44% of the value of the property!

   House price inflation preceded and followed the right to buy. It was far from simply cause and effect. There were many reasons for house inflation in the Thatcher years. The 25% inflation she inherited and solved was one reason. When Mrs Thatcher took over one could only borrow 1.25 times one’s annual salary and usually at least a 5% or 10% deposit was demanded, if one could get a mortgage at all. Second incomes were irrelevant. It reached the stage where one could get four times one’s annual salary, 1.5 times the spouse’s and get 105% mortgage with no deposit. Once again lack of regulation. As house ownership rose, house prices also rose, growing 32% to 1989. This was partly due to the increased number of people in the market (a Thatcher achievement but also a demand side increase) and insufficient new building (supply side).

   The main causes today are the lack of housing stock and perhaps the unfortunate theory of “affordable housing”.

   There may be another crisis built into current BofEngland advice to lenders which is to allow for a rise in interest rates of “up to 3%” – on a 25 or 40 year mortgage. They were limited to 25 years in the 70s and no ‘shared or part ownership schemes’. No housing ladder either, really, not like today.

   I’m not a member of any political party and we agree on atheism, Derek. Not sure we’re in as much agreement here but it’s always a pleasure to read your blog.

3. I went out for a meal last night and our main topic of conversation was the reappearance of the Tory “folly” of selling off Council houses. In the 80’s some of the parents on a local Worcestershire estate took out mortgages; these went sky-high and couldn’t be repaid, so families ended up in B & B’s!
   Talk about selling the family “silver.” Instead of throwing away BILLIONS the government should be using the money (but where has it come from? Does the country have “spare” billions?) to build MORE Social Housing. If we can understand it WHY CAN’T those in undeserved power!!!!!!!!!!!!!!!
   Thanks for expressing what we were saying this evening. I despair!!!!!!!!

4. Today’s Tory plan [creating a new ‘right to buy’] to force taxpayers to hand over thousands (if not tens of thousands) of pounds to each tenant of a select group of housing association tenants wishing to buy their properties [the 30% below market price subsidy amounts to bribery of those voters.
   This is a criminal offence against the electoral laws.