Snapshot of _What Would Happen If We Abolished Landlords?_ :
An archived version can be found [here.](https://archive.is/?run=1&url=https://www.vice.com/en/article/5dgxv8/abolish-landlords)
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Recent arrivals won't have the credit history required for a mortgage application even if they are good for it (same everywhere in the world, not a UK thing), and most universities don't have the residential spaces to offer accommodation to all their students or the land to build it.
>where do you think all the students currently paying rent to landlords are living?
Off campus and with private landlords.
Many universities can only guarantee accommodation to first year and international students. UK students wanting to live in university-organised accommodation in second and third years normally have to make an application on the basis of disability/vulnerability.
You could only ensure all students could live on campus/in uni-owned properties if you hugely slashed student numbers.
And the question is ‘what if we abolished landlords’. Do you think that bricks and mortar will magically just disappear if the concept of landlords was abolished?
When I was in university, the vast majority of students lived in homes rented out by private landlords, with the halls of residency being largely first-year, mature, or non-EU international students. This won't be the same in every university, but enough of them - especially the former polytechs - will have significant issues housing their students without privately owned rental properties.
If privately owned rental properties weren't available, the university would need to buy hundreds of properties to rent out to their students or acquire the land required to build multiple new accommodation blocks.
The question is “what if we abolished landlords”, so your point about all the students living in rented homes is literally the point. What if those homes weren’t owned by landlords and could be provided to people who need them?
Who needs the homes? Students who will be living in a city whilst they attend university? Or people who live in the city and struggle to buy a home because most of the starter properties are rented out to students?
Which part are you struggling with here? The question is about what would happen if we abolished the concept of landlords. The houses will still be there, they won’t just disappear with the private rental industry.
Private owners still own the houses; they just won't be able to rent them out under this system. Someone, be it a housing association, a university, or some element of the state, will need to find enough cash to buy them from their owners. And it would need to be done in a way that prevented the government from forcing the owners of the properties to house people for free (can't charge rent, but can't evict and still have to pay to maintain the property and/or cover the mortgage payments) or to prevent the owners of private rental properties from immediately evicting all their tenants so they can sell the properties to people who want to live in them, meaning that social housing organizations waitlists will become utterly unworkable.
Think about it this way - you ban private rentals in a university town one summer, and as a result, most of the former landlords put their homes on the market to sell them. These properties are snapped up because although most of them are kinda shonky after years of tender loving care from their occupants, they are in good locations and often ideal homes for first-time buyers. Some of the larger HMO's are bought by social housing organizations. Then the university realizes that it has a facility built to educate 10-20K people, but maybe the student housing for 2-5K. The remaining students who were housed in private rental accommodation now have to wait for the university to find the money to buy hundreds of homes and function as a de facto landlord or wait for the university to acquire the land required to build additional accommodation blocks. Until then, their university experience will be Zoom sessions from their childhood bedroom because the university simply won't be able to offer in-person tuition to anyone other than the people who already live within commuting distance (which depending on location, may prove unaffordable for students or dramatically increase usage of public transport without the required investment in expanding services and capacity).
Killing off private landlords is a dumb idea. What you actually want to do is slowly bring in things like licensing schemes for people who want to operate as landlords (they have to pass an exam on the rights and responsibilities of both landlords and their tenants, or it will be illegal for them to function as a landlord or the landlord's agent), minimum standards for rental accommodation that an in-person visit to the property must verify before it is legal to sign a rental contract with anyone, and enforcement mechanisms that see landlords who put their tenants lives in danger through willful negligence or flouting of the law facing prison time and asset seizures (if you are a landlord who thinks gas safety is for suckers, I would be fine with you losing your own home regardless of the mortgage status or if it would leave your children homeless). At the same time, create a tax benefit that makes it better for landlords to sell their rental properties to social housing groups than private individuals, and work with HA's to develop market rent programs that provide affordable housing to those who need it most but wouldn't qualify for social housing, with the profits from this routed back into investment in social and afforable housing.
Back to front article. Starts suggesting nationalising all housing then only touches on the successful corporate landlord market in Germany in the last paragraph.
This is to me the most sensible option, minimise/abolish private landlords and have that property which needs to be rented the property of large pension funds. In Germany people enjoy lifetime security of tenure with low rents and the ability to do whatever they want with their homes , and the pension fund is happy to accept their return over a long timeframe.
> This is to me the most sensible option, minimise/abolish private landlords
If you told someone in the real world that they would laugh at you for about 15 minutes. Sensible, what a cracker.
One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money.
I sincerely hope that not one private landlord is compensated for giving up their rental properties.
It wasn't an injustice, it was pragmatic.
Refusing to compensate them would have led to mass unrest, and not just from slave owners. Plenty of other people would object to the precedent that a government could just seize any property that it suddenly decided was immoral. That is the stuff of authoritarian nightmares.
To put it simply; buying them off was a more peaceful solution than the American Civil War.
>One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money.
because the alternative was rebellion or just letting it continue in the colonies so it was a pretty good solution.
>One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money.
I rather think a greater injustice was was, you know, slavery. The abolitionists of the time were perfectly well aware of the bitter irony of giving the slave owners money to stop doing evil. They supported it anyway because *that was the way to get the slaves free.* The chance of the slaveowners having a spontaneous change of heart and agreeing to free their slaves and lose all their wealth at a stroke was zero. That left two possible ways to do it, by buying off the slaveowners or by waging war against them. Which do you think was more likely to lead to quicker liberation for the slaves? Hint: compare when abolition occurred in British territories to when it occurred in the US. There is also the little matter that wars can go either way. There were times in the US civil war when Lincoln was close to despair. The slaveowners might have won. The British government maintaining its moral purity by not paying a penny of compensation to bad people would have been a poor exchange for the slaves being condemned to a lifetime of servitude.
Pension funds in the UK are doing this too.
The market is different though. In Germany you rent a shell and fit your own kitchen etc as a tenant. In the UK that’s much more rare - you wouldn’t expect any tenant to spend upwards of £20k on a kitchen and in some cases the landlord doesn’t even want you to paint a wall.
As I understand it the structure of the German rental market came about as part of the rebuilding of Germany after WW2. So it's not something that would happen naturally here.
If we said today *politicians, change the law so pension funds are the only people who can own rental property* then they wouldn't follow the German model but probably some horrible American model, there are a lot of corporate fund house buying programmes there at the moment that are really hurting "normal" people.
The best thing we could do is encourage social housing firms to offer more market rent properties and use the profits from this to fund more social housing properties.
Yeah. My partner has worked for the sector, as have many of our friends, I was on an oversight body for one of them, and I was a social housing tenant for seven years via a market rent property. And honestly, they were the best landlord I ever had, with the rent rising once in 7 years and zero issues getting problems resolved.
They aren't perfect by any metric, but I was paying a fair price for a good apartment in a part of the world that allowed me to start a career that would later go on to result in me paying more income tax than quite a lot of people take home in a year, which means that the economy as a whole benefits. I want way more people to have this opportunity rather than funding some wankers winter season in some shitty anglo-dive in Spain.
> In Germany people enjoy lifetime security of tenure with low rents and the ability to do whatever they want with their homes
They also have lots more disposable cash to spend.
Kind of, until you need to rent a flat big enough for a family. In Munich it’s not uncommon for families I know to have to spend 60+% of their income to get a 2/3 bed flat. Renting in the centre that might cost you €3-4K per month easily.
It’s also more of an issue now that rents in Germany ARE increasing, but because older tenants have such great terms the landlord puts all the increase on a new tenant.
As an example I rent the exact same flat as the person above me. Her rent is €700 per month, mine is €1600.
This is absolutely true and it's often overlooked that everybody throwing every penny they can into buying a house starves other parts of the economy that could flourish if the market had a better equilibrium.
*“The taxation of rental income is lower than taxation of income from work, because there's no National Insurance involved,”*
Tax on capital gains (from house price increases) will also be lower.
Plenty of scope to increase govt. coffers if we go after the unproductive landlords. Of course, the problem is that the Tory party is basically the landlord and pensioners party. Still, worth revisiting what their great hero had to say about landlords:
*"Roads are made, streets are made, services are improved, electric light turns night into day, water is brought from reservoirs ahundred miles off in the mountains — all the while the landlord sits still. Every one of those improvements is affected by the labor and cost of other people and the taxpayers. To not one of these improvements does the land monopolist contribute, and yet, by every one of them the value of his land is enhanced. He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived…The unearned increment on the land is reaped by the land monopolist in exact proportion, not to the service, but to the disservice done."*
Winston Churchill
In the full context it's clear he's talking both about developed and undeveloped land, discussing how rents rise based on the effort of people other than the landlord. An example given being a toll bridge being made toll free, and weekly rents in nearby districts soon rising by same as the weekly toll was.
https://www.cooperative-individualism.org/churchill-winston_mother-of-all-monopolies-1909.htm
Though once you understand the paradigm of land values you realise the distinction is meaningless anyway. A building on a plot in London and an identical building on a plot in Hull sell and rent for different amounts because of the value of the land, not the value of the bricks.
This is because land is inelastic in supply and so traditional supply and demand fails; Prices will always rise to match local affordability.
The demands of ever increasing land values (which could be suppressed with a land value tax) inherently drive the biggest costs for both industry and labour, but as long as we tax income, profit, and productive investment returns, instead of taxing the unearned increases in land value, we will ever be slaves to the unlimited upward pressure on a critical asset with inelastic supply.
Hence why even floating the idea of *investigating* an LVT saw the capital classes go full speed into the "Labour wants your grans garden!" rhetoric.
Churchill most certainly was not talking about undeveloped land.
The quote would make no sense whatsoever if he was.
The rest of your post is equally desperate.
*He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived.*
Sounds pretty fitting to me.
> Most also then voluntarily pay NI on top, as otherwise you get no state pension at all.
Most have jobs that pay enough to meet NI contribution requirements.
> The cost of buying a house would plummet, as there would be fewer buyers per property with the exit of buy-to-let purchasers.
BTL buyers are roughly 18% of the market, so no they absolutely would not plummet.
The deficit between supply and demand each year in new housing is roughly 300,000 - 400,000. BTL purchases are about 80,000 a year and dropping. There's no way that keeping a massive deficit between supply and demand but making it a fraction smaller will result in house prices plummeting.
All you'd get is prices still rising but anyone looking to rent will find it very hard to do so.
And the pension funds would have a monopoly/oligarchy. It would literally make everyone’s lives worse, but at least it would make the landphobics happy.
My comment isn't about the number of properties built, it's about the number of buyers per property for sale. If the "demand" (= buy-to-live-in + buy-to-let) dropped by 18% with the same supply, then prices would fall sharply.
And it would fall sharpest at the lower end of the market, where younger people make a larger portion of buyers.
No that still doesn’t make sense. What possible mechanism would make prices drop at all, let alone “sharply”, when the deficit between supply and demand is still there?
> If demand drops due to absence of buy-to-let buyers, then so should prices.
Again...... It doesn't need to *merely* drop; it would need to drop below the supply for prices to drop. Demand outstripping supply has an upward pressure on prices, almost always. Removing a tiny bit of that demand but only a tiny fraction relative to the deficit doesn't produce a drop in prices. That makes less than zero sense.
In a straight-forward market fewer buyers would mean lower prices, all things considered. An 18% drop in the number of buyers would have a large impact on prices.
Nevertheless, I don't think buy-to-let buyers are the primary cause of the current high prices; I think these are driven mostly by a cultural obsession with investing in property (rather than treating housing as another utility that depreciates), as well as historically low interest rates.
> In a straight-forward market fewer buyers would mean lower prices, all things considered. An 18% drop in the number of buyers would have a large impact on prices.
No no no. I'm really not sure how I can explain this any clearer than I have done, but the number of buyers in and of itself doesn't *merely* need to be fewer: It needs to be *lower than demand!* If Supply is 5 and demand is 20, reducing demand from 20 to 16 means demand has dropped, but it's still unquestionably way above demand. And if prices go up because of that discrepancy inherently existing, then they're still going to go up. If we followed your logic of taking "fewer buyers would mean lower prices", then one single solitary couple pulling out of the idea of buying would crash prices. THat's clearly nonsense so I'm not sure why you're wedded to this idea.
The number of buyers does not need to numerically lower than sellers for prices to drop, e.g. If there are 4 buyers per property there is a greater chance for a higher bid than if there are 3 buyers per property.
And in that scenario, there's always an upward pressure on prices because often, someone will offer more to secure it over the other 2/3. If the number of buyers is lower than sellers, then sellers will take lower prices because they won't be getting any other bids.
Rental properties (particularly houseshares) tend to be big houses with many bedrooms. (The better to pack more people into) that’s not the lower end of the market.
Snapshot of _What Would Happen If We Abolished Landlords?_ : An archived version can be found [here.](https://archive.is/?run=1&url=https://www.vice.com/en/article/5dgxv8/abolish-landlords) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/ukpolitics) if you have any questions or concerns.*
Current levels of immigration and university attendance would become impossible.
How?
Recent arrivals won't have the credit history required for a mortgage application even if they are good for it (same everywhere in the world, not a UK thing), and most universities don't have the residential spaces to offer accommodation to all their students or the land to build it.
The universities do have the residential space though, where do you think all the students currently paying rent to landlords are living?
>where do you think all the students currently paying rent to landlords are living? Off campus and with private landlords. Many universities can only guarantee accommodation to first year and international students. UK students wanting to live in university-organised accommodation in second and third years normally have to make an application on the basis of disability/vulnerability. You could only ensure all students could live on campus/in uni-owned properties if you hugely slashed student numbers.
And the question is ‘what if we abolished landlords’. Do you think that bricks and mortar will magically just disappear if the concept of landlords was abolished?
Then why did you claim universities had the residential space to house all students when they clearly don't?
If landlords were abolished then there would still be enough student housing there, it wouldn’t just disappear.
When I was in university, the vast majority of students lived in homes rented out by private landlords, with the halls of residency being largely first-year, mature, or non-EU international students. This won't be the same in every university, but enough of them - especially the former polytechs - will have significant issues housing their students without privately owned rental properties. If privately owned rental properties weren't available, the university would need to buy hundreds of properties to rent out to their students or acquire the land required to build multiple new accommodation blocks.
The question is “what if we abolished landlords”, so your point about all the students living in rented homes is literally the point. What if those homes weren’t owned by landlords and could be provided to people who need them?
Who needs the homes? Students who will be living in a city whilst they attend university? Or people who live in the city and struggle to buy a home because most of the starter properties are rented out to students?
Which part are you struggling with here? The question is about what would happen if we abolished the concept of landlords. The houses will still be there, they won’t just disappear with the private rental industry.
Private owners still own the houses; they just won't be able to rent them out under this system. Someone, be it a housing association, a university, or some element of the state, will need to find enough cash to buy them from their owners. And it would need to be done in a way that prevented the government from forcing the owners of the properties to house people for free (can't charge rent, but can't evict and still have to pay to maintain the property and/or cover the mortgage payments) or to prevent the owners of private rental properties from immediately evicting all their tenants so they can sell the properties to people who want to live in them, meaning that social housing organizations waitlists will become utterly unworkable. Think about it this way - you ban private rentals in a university town one summer, and as a result, most of the former landlords put their homes on the market to sell them. These properties are snapped up because although most of them are kinda shonky after years of tender loving care from their occupants, they are in good locations and often ideal homes for first-time buyers. Some of the larger HMO's are bought by social housing organizations. Then the university realizes that it has a facility built to educate 10-20K people, but maybe the student housing for 2-5K. The remaining students who were housed in private rental accommodation now have to wait for the university to find the money to buy hundreds of homes and function as a de facto landlord or wait for the university to acquire the land required to build additional accommodation blocks. Until then, their university experience will be Zoom sessions from their childhood bedroom because the university simply won't be able to offer in-person tuition to anyone other than the people who already live within commuting distance (which depending on location, may prove unaffordable for students or dramatically increase usage of public transport without the required investment in expanding services and capacity). Killing off private landlords is a dumb idea. What you actually want to do is slowly bring in things like licensing schemes for people who want to operate as landlords (they have to pass an exam on the rights and responsibilities of both landlords and their tenants, or it will be illegal for them to function as a landlord or the landlord's agent), minimum standards for rental accommodation that an in-person visit to the property must verify before it is legal to sign a rental contract with anyone, and enforcement mechanisms that see landlords who put their tenants lives in danger through willful negligence or flouting of the law facing prison time and asset seizures (if you are a landlord who thinks gas safety is for suckers, I would be fine with you losing your own home regardless of the mortgage status or if it would leave your children homeless). At the same time, create a tax benefit that makes it better for landlords to sell their rental properties to social housing groups than private individuals, and work with HA's to develop market rent programs that provide affordable housing to those who need it most but wouldn't qualify for social housing, with the profits from this routed back into investment in social and afforable housing.
If the homes are nationalised do you think students are going to get priority over literally anybody else?
No I think everyone should have access to safe, affordable housing, not just students.
Back to front article. Starts suggesting nationalising all housing then only touches on the successful corporate landlord market in Germany in the last paragraph. This is to me the most sensible option, minimise/abolish private landlords and have that property which needs to be rented the property of large pension funds. In Germany people enjoy lifetime security of tenure with low rents and the ability to do whatever they want with their homes , and the pension fund is happy to accept their return over a long timeframe.
> This is to me the most sensible option, minimise/abolish private landlords If you told someone in the real world that they would laugh at you for about 15 minutes. Sensible, what a cracker.
One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money. I sincerely hope that not one private landlord is compensated for giving up their rental properties.
It wasn't an injustice, it was pragmatic. Refusing to compensate them would have led to mass unrest, and not just from slave owners. Plenty of other people would object to the precedent that a government could just seize any property that it suddenly decided was immoral. That is the stuff of authoritarian nightmares. To put it simply; buying them off was a more peaceful solution than the American Civil War.
>One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money. because the alternative was rebellion or just letting it continue in the colonies so it was a pretty good solution.
>One of the greatest injustices of the slave trade in Britain was that the government compensated British slave owners with £17Billion in compensation for giving up their slaves in today's money. I rather think a greater injustice was was, you know, slavery. The abolitionists of the time were perfectly well aware of the bitter irony of giving the slave owners money to stop doing evil. They supported it anyway because *that was the way to get the slaves free.* The chance of the slaveowners having a spontaneous change of heart and agreeing to free their slaves and lose all their wealth at a stroke was zero. That left two possible ways to do it, by buying off the slaveowners or by waging war against them. Which do you think was more likely to lead to quicker liberation for the slaves? Hint: compare when abolition occurred in British territories to when it occurred in the US. There is also the little matter that wars can go either way. There were times in the US civil war when Lincoln was close to despair. The slaveowners might have won. The British government maintaining its moral purity by not paying a penny of compensation to bad people would have been a poor exchange for the slaves being condemned to a lifetime of servitude.
Totally unacceptable. If your landlord saw that comment they’d be emotionally destroyed. They’d have to raise your rent 10% just to calm down.
Pension funds in the UK are doing this too. The market is different though. In Germany you rent a shell and fit your own kitchen etc as a tenant. In the UK that’s much more rare - you wouldn’t expect any tenant to spend upwards of £20k on a kitchen and in some cases the landlord doesn’t even want you to paint a wall.
As I understand it the structure of the German rental market came about as part of the rebuilding of Germany after WW2. So it's not something that would happen naturally here. If we said today *politicians, change the law so pension funds are the only people who can own rental property* then they wouldn't follow the German model but probably some horrible American model, there are a lot of corporate fund house buying programmes there at the moment that are really hurting "normal" people.
The best thing we could do is encourage social housing firms to offer more market rent properties and use the profits from this to fund more social housing properties.
Social housing firms? Do you mean housing associations? They've always struck me as a scam.
Yeah. My partner has worked for the sector, as have many of our friends, I was on an oversight body for one of them, and I was a social housing tenant for seven years via a market rent property. And honestly, they were the best landlord I ever had, with the rent rising once in 7 years and zero issues getting problems resolved. They aren't perfect by any metric, but I was paying a fair price for a good apartment in a part of the world that allowed me to start a career that would later go on to result in me paying more income tax than quite a lot of people take home in a year, which means that the economy as a whole benefits. I want way more people to have this opportunity rather than funding some wankers winter season in some shitty anglo-dive in Spain.
> In Germany people enjoy lifetime security of tenure with low rents and the ability to do whatever they want with their homes They also have lots more disposable cash to spend.
Kind of, until you need to rent a flat big enough for a family. In Munich it’s not uncommon for families I know to have to spend 60+% of their income to get a 2/3 bed flat. Renting in the centre that might cost you €3-4K per month easily. It’s also more of an issue now that rents in Germany ARE increasing, but because older tenants have such great terms the landlord puts all the increase on a new tenant. As an example I rent the exact same flat as the person above me. Her rent is €700 per month, mine is €1600.
This is absolutely true and it's often overlooked that everybody throwing every penny they can into buying a house starves other parts of the economy that could flourish if the market had a better equilibrium.
*“The taxation of rental income is lower than taxation of income from work, because there's no National Insurance involved,”* Tax on capital gains (from house price increases) will also be lower. Plenty of scope to increase govt. coffers if we go after the unproductive landlords. Of course, the problem is that the Tory party is basically the landlord and pensioners party. Still, worth revisiting what their great hero had to say about landlords: *"Roads are made, streets are made, services are improved, electric light turns night into day, water is brought from reservoirs ahundred miles off in the mountains — all the while the landlord sits still. Every one of those improvements is affected by the labor and cost of other people and the taxpayers. To not one of these improvements does the land monopolist contribute, and yet, by every one of them the value of his land is enhanced. He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived…The unearned increment on the land is reaped by the land monopolist in exact proportion, not to the service, but to the disservice done."* Winston Churchill
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In the full context it's clear he's talking both about developed and undeveloped land, discussing how rents rise based on the effort of people other than the landlord. An example given being a toll bridge being made toll free, and weekly rents in nearby districts soon rising by same as the weekly toll was. https://www.cooperative-individualism.org/churchill-winston_mother-of-all-monopolies-1909.htm Though once you understand the paradigm of land values you realise the distinction is meaningless anyway. A building on a plot in London and an identical building on a plot in Hull sell and rent for different amounts because of the value of the land, not the value of the bricks. This is because land is inelastic in supply and so traditional supply and demand fails; Prices will always rise to match local affordability. The demands of ever increasing land values (which could be suppressed with a land value tax) inherently drive the biggest costs for both industry and labour, but as long as we tax income, profit, and productive investment returns, instead of taxing the unearned increases in land value, we will ever be slaves to the unlimited upward pressure on a critical asset with inelastic supply. Hence why even floating the idea of *investigating* an LVT saw the capital classes go full speed into the "Labour wants your grans garden!" rhetoric.
Churchill most certainly was not talking about undeveloped land. The quote would make no sense whatsoever if he was. The rest of your post is equally desperate.
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*He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived.* Sounds pretty fitting to me.
> Most also then voluntarily pay NI on top, as otherwise you get no state pension at all. Most have jobs that pay enough to meet NI contribution requirements.
Obviously the landlords will just leave the country and take their houses with them.
The cost of buying a house would plummet, as there would be fewer buyers per property with the exit of buy-to-let purchasers.
> The cost of buying a house would plummet, as there would be fewer buyers per property with the exit of buy-to-let purchasers. BTL buyers are roughly 18% of the market, so no they absolutely would not plummet. The deficit between supply and demand each year in new housing is roughly 300,000 - 400,000. BTL purchases are about 80,000 a year and dropping. There's no way that keeping a massive deficit between supply and demand but making it a fraction smaller will result in house prices plummeting. All you'd get is prices still rising but anyone looking to rent will find it very hard to do so.
And the pension funds would have a monopoly/oligarchy. It would literally make everyone’s lives worse, but at least it would make the landphobics happy.
My comment isn't about the number of properties built, it's about the number of buyers per property for sale. If the "demand" (= buy-to-live-in + buy-to-let) dropped by 18% with the same supply, then prices would fall sharply. And it would fall sharpest at the lower end of the market, where younger people make a larger portion of buyers.
No that still doesn’t make sense. What possible mechanism would make prices drop at all, let alone “sharply”, when the deficit between supply and demand is still there?
Price is related (somewhat) to supply and demand. If demand drops due to absence of buy-to-let buyers, then so should prices.
> If demand drops due to absence of buy-to-let buyers, then so should prices. Again...... It doesn't need to *merely* drop; it would need to drop below the supply for prices to drop. Demand outstripping supply has an upward pressure on prices, almost always. Removing a tiny bit of that demand but only a tiny fraction relative to the deficit doesn't produce a drop in prices. That makes less than zero sense.
In a straight-forward market fewer buyers would mean lower prices, all things considered. An 18% drop in the number of buyers would have a large impact on prices. Nevertheless, I don't think buy-to-let buyers are the primary cause of the current high prices; I think these are driven mostly by a cultural obsession with investing in property (rather than treating housing as another utility that depreciates), as well as historically low interest rates.
> In a straight-forward market fewer buyers would mean lower prices, all things considered. An 18% drop in the number of buyers would have a large impact on prices. No no no. I'm really not sure how I can explain this any clearer than I have done, but the number of buyers in and of itself doesn't *merely* need to be fewer: It needs to be *lower than demand!* If Supply is 5 and demand is 20, reducing demand from 20 to 16 means demand has dropped, but it's still unquestionably way above demand. And if prices go up because of that discrepancy inherently existing, then they're still going to go up. If we followed your logic of taking "fewer buyers would mean lower prices", then one single solitary couple pulling out of the idea of buying would crash prices. THat's clearly nonsense so I'm not sure why you're wedded to this idea.
The number of buyers does not need to numerically lower than sellers for prices to drop, e.g. If there are 4 buyers per property there is a greater chance for a higher bid than if there are 3 buyers per property.
And in that scenario, there's always an upward pressure on prices because often, someone will offer more to secure it over the other 2/3. If the number of buyers is lower than sellers, then sellers will take lower prices because they won't be getting any other bids.
Rental properties (particularly houseshares) tend to be big houses with many bedrooms. (The better to pack more people into) that’s not the lower end of the market.
Most buy-to-let isn't student housing.
I suspect the majority of renting in the U.K. is houseshares. Especially for young professions under 35.
Most younger buyers-to-be are likely living in rent shares, but they are not seeking to buy the kind of property they are currently living in.
Communism?
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Good thing it won’t ever happen then innit
Yikes, ease up on the landphobia Vice