Gentrification, good or bad?

[chrisp65]

11 minutes ago, StefanAVFC said:

Oof fun topic.

We are building a house, within our family over here we have 2 holiday homes that we built outselves on family owned land. Is building your own second home on your own land fitting into this controversy in the same way? Different country I guess.

We also plan to buy a flat purely to rent, at the going rate in town. Is this acceptable?

 

Absolutely no idea what the situation is in Poland.

But surely, people building their own properties are not taking properties out of the local ‘pool’?

They might potentially be adding to the gentrification of an area, I guess. But that’s quite a complicated, nuanced thing. I’ve got no problem with artisan bakeries adding to the mix in an area.

[Mozzavfc]

2 hours ago, nick76 said:

What a silly idea!  Not only taxing the multiple properties for so many reasons but then do you think the government will invest that tax money back into that community directly? No chance.  Also you think it’s a moral obligation but many would disagree it’s a moral issue at all.

If the tax was done as additional council taxes on second homes, then it would go back into the local area, which is needed. Agree that if it's a central government type tax, like an extra stamp duty, it'll just be another revenue stream for Tory donors and wasted

[chappy]

Interesting reading this topic. My in-laws have a ‘second home’ in a village in the very south of the Lake District. It’s on a little estate of new builds. Pre-Covid, they rented it out on Airbnb whenever a family member wasn’t using it. Never thought before that it might be taking a potential home away from local people. Am I the baddy?

Edited March 19, 2022 by chappy

[sidcow]

2 minutes ago, chappy said:

Interesting reading this topic. My in-laws have a ‘second home’ in a village in the very south of the Lake District. It’s on a little estate of new builds. Pre-Covid, they rented it out on Airbnb whenever a family member wasn’t using it. Never thought before that it might be taking a potential home away from local people. Am I the baddy?

No, your in-laws are the evil ones

Edited March 19, 2022 by sidcow

[Chine]

Soooo , I owned a house in Tenerife for many years but sold it pre covid, we used it for around 3 months spread over each year and stopped renting it out as was fed up with the hassle  , I certainly never thought I was depriving a homeless person of a bed for the night more like we were keeping people in employment from airlines to bar staff , I have a friend who owns a static caravan in Brean which he rents out as short holiday lets and uses himself , is he a bad person ?

[KentVillan]

Interesting thing for me is how this has become a thread about second homes in holiday villages, but in cities gentrification usually means Audi driving yuppies moving into deprived neighbourhoods and then loads of coffee shops and fancy bars and craft beer pubs opening up, while all the old retailers and youth clubs and schools close down.

[chrisp65]

12 minutes ago, KentVillan said:

Interesting thing for me is how this has become a thread about second homes in holiday villages, but in cities gentrification usually means Audi driving yuppies moving into deprived neighbourhoods and then loads of coffee shops and fancy bars and craft beer pubs opening up, while all the old retailers and youth clubs and schools close down.

Yeah I’m genuinely not so sure what can be done about that with any sort of fairness. If somebody actually moves in to an area and its to be their primary residence, I don’t know how you stop that, or if you even should? You can’t really have locals only areas (I know you can advertise homes for locals on new builds) but I’m not sure you should be able to stop someone moving in to an area. Just make sure others don’t have to move out because they are priced out. It was what the affordable housing scheme was supposed to support, but the scheme doesn’t work.

I think I said somewhere else, you can’t stop someone opening an artisan bakery, you just have to somehow make sure the area doesn’t lose it’s facilities and services for more modest budgets.

Perhaps rent controls and rent caps would stop property speculation and profiteering landlords, which itself would reduce some demand as it would take out the attraction of adding a tier of rental profit in to the housing market?

[KentVillan]

6 minutes ago, chrisp65 said:

Yeah I’m genuinely not so sure what can be done about that with any sort of fairness. If somebody actually moves in to an area and its to be their primary residence, I don’t know how you stop that, or if you even should? You can’t really have locals only areas (I know you can advertise homes for locals on new builds) but I’m not sure you should be able to stop someone moving in to an area. Just make sure others don’t have to move out because they are priced out. It was what the affordable housing scheme was supposed to support, but the scheme doesn’t work.

I think I said somewhere else, you can’t stop someone opening an artisan bakery, you just have to somehow make sure the area doesn’t lose it’s facilities and services for more modest budgets.

Perhaps rent controls and rent caps would stop property speculation and profiteering landlords, which itself would reduce some demand as it would take out the attraction of adding a tier of rental profit in to the housing market?

I think the key is better systems of local democracy so that planning is sensitive to the needs of existing residents. Of course that's a double edged sword, because it's also how you end up with NIMBYism.

Sam Bowman's suggestion in the interview I shared is this thing called Street Votes. I'm not sure how workable it would be, but I think it offers a good critique of the current situation.

https://plmr.co.uk/2022/03/is-the-idea-of-street-votes-the-future-of-localised-planning-or-an-undeliverable-big-idea/

Quote

IS THE IDEA OF ‘STREET VOTES’ THE FUTURE OF LOCALISED PLANNING, OR AN UNDELIVERABLE ‘BIG IDEA’?

With the support of Michael Gove, Secretary of State at the new Department for Levelling Up Housing and Communities (DLUHC), under its belt, the idea of Street Votes is fast gaining credence in planning circles as the next big thing in community-led planning. The Street Votes report by Policy Exchange, available to view here, outlines the idea of providing residents with the opportunity to hold referendums on regenerating their street. Should residents vote in favour of the idea, they would be given the power to create a design code, which would include parameters for the height and footprint of development.

The street votes idea is born from the desire to provide a way to intensify existing development in the suburbs, to provide more architecturally appealing street scenes, as well as additional units on brownfield land to help combat the housing crisis.

The report outlines that a large amount of community objection is fuelled by the fact that much new development has a negative effect on existing communities. This impact is felt most prevalently in the form of additional pressure to local infrastructure, with additional cars on the roads, children at schools and patients for doctors to see. With many of these services already stretched.

The lack of perceived benefits for the community, combined with this additional pressure on infrastructure provides the perfect conditions for a resident objection storm. Why is this important? Well, community buy in for proposals can often be a prerequisite for political support. In many cases members are perhaps able to see the advantages of the proposals, but they feel unable to support development, given the large objection from their constituents. Street votes look to increase this community buy in, in turn providing political support.

The monetary gain residents could achieve from the concept is one of the main reasons for confidence over resident support. The report suggests that, on average, residents involved could make £900,000 – certainly not a figure to be taken lightly.

The idea is that instead of local councils selling planning to corporations after intensive professional lobbying, local residents would "sell" the rights to develop their neighbourhood, and would be more motivated to do this in a way that serves the community.

I guess you'd need lots of limits in place, and there would be horror stories, but it's probably still better than letting some councillor who lives 10 miles from his ward just agreeing a building project over an expensive meal.

Edited March 19, 2022 by KentVillan

[chrisp65]

 

 

[Sam-AVFC]

Many holiday home owners are taking advantage of a loophole where they can get assessed for business rates instead of council tax if they rent it out. Most are well below the threshold to pay anything so these rural councils are losing out on more income at a time they really can't afford to.

Even places specifically built as multiple holiday lets (so arguably should be assessed as a business) are benefitting from falling below the threshold to pay anything.

I know Cornwall in particular is losing out on council tax on an enormous amount of properties. I imagine it's also a problem in areas of Wales, Cumbria etc.

Edited March 25, 2022 by Sam-AVFC

[KentVillan]

1 minute ago, Sam-AVFC said:

Many holiday home owners are taking advantage of a loophole where they can get it assessed for business rates instead of council tax if they rent it out. Most are well below the threshold to pay anything so these rural councils are losing out on more income at a time they really can't afford to.

Even places specifically built as multiple holiday lets (so arguably should be assessed as a business) are benefitting from falling below the threshold to pay anything.

I know Cornwall in particular is losing out on council tax on an enormous amount of properties.

Yeah IMO it's these tax loopholes that need fixing, not the entire concept of having a holiday home.

[chrisp65]

4 hours ago, KentVillan said:

Yeah IMO it's these tax loopholes that need fixing, not the entire concept of having a holiday home.

Yes. As long as that tax loophole is closed to the point where people have somewhere to live and the schools don’t close.

It’ll be quite a lot of tax. But that shouldn’t be a problem if you’re wealthy enough to be hoovering up the places other people could be calling home.

[KentVillan]

26 minutes ago, chrisp65 said:

Yes. As long as that tax loophole is closed to the point where people have somewhere to live and the schools don’t close.

It’ll be quite a lot of tax. But that shouldn’t be a problem if you’re wealthy enough to be hoovering up the places other people could be calling home.

I’m not sure it needs to be *that* much tax - just sufficiently high to encourage people to invest that money in more productive assets (shares, bonds, whatever) that actually contribute to the wider economy.

We have a situation in this country where property is seen as a bulletproof investment, and lots of very wealthy (and not particularly wealthy!) people invest far too high a % of their personal wealth in it (beyond their own place of residence).

You only have to look at how many YouTube / Instagram financial influencer types fixate on having a “property portfolio”.

Combine that with general inequality and a failure to build housing, and it just keeps getting worse.

[nick76]

Expecting politicians and people who influence them who all have second or more homes to push for more tax increases or to close the loopholes….

[chrisp65]

3 minutes ago, KentVillan said:

I’m not sure it needs to be *that* much tax - just sufficiently high to encourage people to invest that money in more productive assets (shares, bonds, whatever) that actually contribute to the wider economy.

We have a situation in this country where property is seen as a bulletproof investment, and lots of very wealthy (and not particularly wealthy!) people invest far too high a % of their personal wealth in it (beyond their own place of residence).

You only have to look at how many YouTube / Instagram financial influencer types fixate on having a “property portfolio”.

Combine that with general inequality and a failure to build housing, and it just keeps getting worse.

Well, no sense in tweeking the system to try and gauge a sweet spot for the rich to make different decisions. Tax the home hoarders so others get a home.

Keeps it nice and tidy.

[KentVillan]

26 minutes ago, chrisp65 said:

Well, no sense in tweeking the system to try and gauge a sweet spot for the rich to make different decisions. Tax the home hoarders so others get a home.

Keeps it nice and tidy.

I think I agree, but also wish the entire British addiction to property ownership (*especially* property as an investment) based on eternally rising house prices, could be tackled somehow. I think politicians are scared to do it because homeowners vote and, for the Tories, property portfolio owners fund their party.

It’s a mess. What’s tragic is that our voting system helps to entrench a form of narrow “localism” which is really just protectionist Nimbyism, and even when the major parties want to take action, they get punished at the ballot box.

I’m not really sure what a realistic solution is. We know conceptually what the solution is, but how you get the British electorate to vote for that solution over more than one electoral cycle is a massive headache.

I think it all dates back to when Thatcher realised the short term electoral power of right to buy? Since then every govt has deliberately distorted the housing market in stupid ways to win votes. The Tories have definitely been worse, but the Blair/ Brown govts were hardly blameless, and I wonder how much appetite Starmer would have for fixing it properly.

Edited March 25, 2022 by KentVillan

[nick76]

19 minutes ago, KentVillan said:

I’m not sure it needs to be *that* much tax - just sufficiently high to encourage people to invest that money in more productive assets (shares, bonds, whatever) that actually contribute to the wider economy.

We have a situation in this country where property is seen as a bulletproof investment, and lots of very wealthy (and not particularly wealthy!) people invest far too high a % of their personal wealth in it (beyond their own place of residence).

You only have to look at how many YouTube / Instagram financial influencer types fixate on having a “property portfolio”.

Combine that with general inequality and a failure to build housing, and it just keeps getting worse.

Or those that were to invest that money in property in the uk now invest in property abroad so the money goes out of the country and additionally the loss of tourism money that those local communities rely on.  Even replies to the above commentators Twitter post gives an indication how much these communities rely on tourism.

With how quick it is to get abroad these days as well.  So more available houses in those local communities but now the local job market crashed so people have to move away anyway. 

I know if I got priced out of Cornwall, I would move that money abroad.  I have a good friend whose already done that not because of priced out but the option was better value and where that tourism money was previously spent in down Cornwall is now regularly spent abroad.  You start implementing tax changes and yes people buy less second homes in the UK but also spend less money in these communities.  Getting rid of second home owners causes just as many problems.

[KentVillan]

3 minutes ago, nick76 said:

Or those that were to invest that money in property in the uk now invest in property abroad so the money goes out of the country and additionally the loss of tourism money that those local communities rely on.  Even replies to the above commentators Twitter post gives an indication how much these communities rely on tourism.

With how quick it is to get abroad these days as well.  So more available houses in those local communities but now the local job market crashed so people have to move away anyway. 

I know if I got priced out of Cornwall, I would move that money abroad.  I have a good friend whose already done that not because of priced out but the option was better value and where that tourism money was previously spent in down Cornwall is now regularly spent abroad.  You start implementing tax changes and yes people buy less second homes in the UK but also spend less money in these communities.  Getting rid of second home owners causes just as many problems.

The purchase of the house is not what generates the tourism revenue. I agree these communities have naturally had to tilt towards tourism, and it’s unrealistic to think they will always have the same community when traditional industries & agriculture decline.

But leaving big tax loopholes for speculative property investors vs homebuyers doesn’t really have the effect you describe, and the idea that all that money would just funnel out instead to foreign countries is based on what evidence?

The point is the “opportunity cost” you outline isn’t really a cost. Property isn’t really a productive investment in the same way as investing in a business. Who gives a **** if some of that money goes on a villa in Cyprus.

Edited March 25, 2022 by KentVillan

[chrisp65]

How much do you have to spend at the petrol station to keep a school open?

Must be a fair old wack?

[nick76]

4 minutes ago, KentVillan said:

but how you get the British electorate to vote for that solution over more than one electoral cycle is a massive headache.

Because a large amount of the British electorate dream of the great life, to win the lottery, to have the great life, the second home, the nice car and happy family.  While that dream lives on is the reason why the electorate will never push to limit on what their dream could be and if it doesn’t impact them here and now they have too many current issues to care about other peoples issues miles away.