The housing crisis is a pensions problem - FT @_kate_allen

Wow, what an insightful piece. Nails a lot of the macroeconomic realities about the UK real estate market. 

It would have been nice for Kate Allen's wisdom to have gone far enough to suggest a solution. But solutions that involve 'other people's' money are always dangerous (and possibly naive) to voice. 

I, for one, believe there is sufficient housing stock (there is not widespread involuntary homelessness).  

The problem is access to enough housing.

Housing wealth has continued to concentrate in fewer, wealthier hands; reversing the democratic trend pre-1980. 

There is a clear culprit: politicians. Particularly the much loved Maggie Thatcher who legalised the selling/stealing of public housing.

What most commentators don't understand, when they pose that we're not building to replace homes bought with Right to Buy, is that the UK government had exited the house building game. As with much else, housebuilding has been privatised. 

But the private sector don't build homes, they carefully plan profits out of the land.  

Anyhow, enough housebuilder-bashing. 

Here are some naive suggestions to maintain the UK as a country that wants to continue subsidising homeownership, and solve the housing crisis:

- outlaw the conversion of houses into flats. Private landlords want yield. Families want a home. Houses are becoming a rare metropolitan commodity. 

- raise interest rates (encouraging investment in things other than monetary instruments and real estate) while providing a Bank of England subsidised loan to owner-occupiers with no other real estate assets. Push that further by terminating the loan on the purchase of a second home or buy-to-let investment.

- scrap 'possession' procedures. No more Section 8s and 21s. If a tenant is two months in arrears, landlords can notify the council and take possession one week later. If tenants are not in arrears, they cannot be evicted. However, that tenancy cannot be assigned, novated or sub-let without the property returning to the landlord's possession.  

- introduce a 'Right to Buy your Private Rented Accommodation'. Just model out the economic ramifications of this, and you'll have a good Sunday afternoon laugh.  

Here's the original article by Kate Allen in the FT: