Interesting Links for 03-11-2013
- A great short film about bikes and childhood. Delightful _and_ impressive
(tags: bicycles viaSkreidle video ) - Simon's cat vs the spider. I giggled all the way through. And now itch.
I _wish_ that last time I had a cat, it had been this good with spiders.
(tags: cats spiders funny video ) - Amazing car ad, full of optical illusions
(tags: cars ( Read more... )
Figure 2 -- assumes a "normal" level of household ownership I think and therefore tries to worry us because fewer people are owning houses. That graph goes from 57%-69% back to 64% and we're supposed to be worried. Plot Germany on there it would be off the bottom the whole time. Plot, say, Croatia, that would be off the top the whole time. (There's no obvious correlation with wealth, I suspect it is cultural, some countries most people own, some countries it is rare... some countries have no mortgage tradtion even.) We're middling high in home ownership after a post-thatcher surge.
Figure 3 shows a fairly typical age curve -- this looks the same in most countries in Europe.
Figures 4-5 -- very misleading. the growth rate in cost is actually not huge. The comparison with what items would cost is stupid -- it's projecting those items cost into the future and saying "isn't that shocking" -- but with 30 years of inflation on current priaces that is about what those things will cost. The rise in house prices has been around about inflationary. The house is shown at 80,000 in 1983 and 150,000 now. An item costing 80,000 in 1983 would by inflation cost about 240,000 now. It's unclear if those figures are inflation adjusted. The best "neutral" measure I can find is earnings to house cost ratio -- divide mean house cost by mean wage. Between 1983 and now the cost of a house has gone between 3x earnings and 6x earnings. The average is 4.1x earnings and it's currently 5x earnings. Not hugely above the historic average -- above but not massively. Given current caps on mortgages we likely won't see huge changes in this ratio soon (but I may be wrong).
Figure 6 and 7 -- Are we building "enough" houses? You can't tell from that graph which doesn't include population growth -- you don't have the information to know. The best measure of whether we are building houses faster than the population grows is average household size. This has shrunk since 1980. (It's around about 2.1 now, was around about 2.3 or 2.4 then -- haven't looked it up, that's from memory so may be unreliable but it was higher.) There are more houses per person. You could argue we should still build more of course. Which would decrease the average household size further -- increase the number of second homes, perhaps bring down house prices.
Figure 9 -- if there's one thing Thatcher definitely did, it was to get more home ownership. It depends on your viewpoint whether this is a good thing. I think social housing is an admirable thing and the desire to own your own home is characteristic of Britain more than most countries. Thatcher certainly cause more people to own houses -- private ownership was her big goal, for houses, cars, companies. She got it.
Figure 12 -- London is putting up new skyscrapers all the time. I was standing on Waterloo bridge the other day and it had one of those things which points out all the tall buildings on the landscape. 4 of the largest six weren't marked as the plaque was three years old. London is building upwards right now and faster than it ever has.
http://en.wikipedia.org/wiki/List_of_tallest_buildings_and_structures_in_London
7 of the 10 tallest were built since 2000 and 4 were built in the last 4 years (while we're in a recession). There's 4 more under construction, 10 more approved which would be in the current top 10 tallest in London. It's actually remarkable to watch. I've been here 6 years and the skyline has changed.
Figure 15 -- UK houses are smaller in part because fewer people are living in them. In spain the average household size is 2.8. In france 2.4. In the UK it is 2.1. This works out at UK 36.2 Spain 34.8 France 47 m^2 per person. So UK is still quite low but not as low as Spain. Of course Australia and the US have huge houses, they are huge countries with relatively few people per square mile. The standout data point on that graph is denmark which has quite dense population but big houses.
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I do think that the UK has an issue with home ownership - we focus highly on it, where Germany doesn't. But part of that is because Germany has much better protections for renters (so far as I know).
What I'd like to see is the percentage of income that people spend on rent/mortgage, over time. I'll have a dig about and see if I can find that.
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I think I posted something about rent versus mortgage costs possibly on here some time ago in a debate about what are the financial trade offs.
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Some of the new build tall buildings in London are residential and if you look at the 100m buildings not the 200m buildings, many are. [Of course there are issues with getting mortgages in tall buildings...]
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This report from the Office of National Statistics shows no positive effect on owner-occupation by Thatcher.
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"The data suggests that most of the expansion in owner occupancy since 1981 has largely been a result of movement from social housing to owner occupancy, rather than from private renting as was the case in the 1950s and 1960s."
In other words Thatcher's wholesale butchery of social housing and cheap sell off of council housing led to more people owning council houses (albeit not usually those who were originally living in them).
Or are you saying that the data shows that the owner-occupier growth was part of a trend which was happening anyway?
To be honest, I don't particularly want more owner-occupiers. I don't think there's particular virtue in owning versus renting if rental is sufficiently well legally protected.
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