Scottish Daily Mail

Last-time buyers hold key


THE difficulti­es faced by the priced- out generation of first time buyers are well-aired, and rightly so, but helping last time buyers is one of the things that need to be done to correct the dysfunctio­ns of the housing market.

There is no doubt that life has become much, much more difficult for young people taking their first steps onto the property ladder as prices have shot up through a combinatio­n of cheap money, overseas buyers and the British obsession with owner-occupation.

When my parents bought a Wimpey bungalow in 1969, the price of a starter home was just over £4,000.

It has risen around 48 times since then, to a typical price of just under £200,000.

This hugely outstrips the growth in first-time buyer incomes, which have risen 29 times from £1,600 to £47,574, according to Shelter.

In London, matters are even more extreme.

My first property in the capital was purchased in the 1990s at a multiple of 2.5 times salary.

That apartment has risen in value tenfold, putting it well out of reach of young jobbing journal- ists and into trust fund territory. The fact that David Cameron’s plans to build starter homes with discounts for first time buyers up to the (middle) age of 40 tells its own story: in previous generation­s, a 40-something taking their first step into ownership would have been a rare bird.

Pensions freedom day in April may deal yet another blow to first-timers, as hordes of older people are expected to invest their newly-liberated retirement money in buy-to-let property, crowding out their children and grandchild­ren.

Blaming older people is futile, however, particular­ly since there are plenty of problems at the other end of the age spectrum.

Supply shortage is routinely cited as one of the major factors behind the property crisis, but what is often ignored is the fact that the UK is specifical­ly failing to build retirement homes.

The nation’s housing stock does not reflect the ageing population: with the number of over-65s set to grow to more than 17m by 2033, from 11.4m last year, we need properties suitable for ageing single people and couples in towns and cities as well as family houses built on green belt land. Millions of older people are potentiall­y i n the market for down- sizing and moving into a retirement home, but are unable to do so because there are only around 110,000 retirement properties in the UK available to buy.

Building more retirement homes would help release properties onto the market for younger families, reducing the need for new build. There are several measures other that could help get the lastt i me buyer market moving, including a requiremen­t on local authoritie­s to have specific housing policies for older people.

Initiative­s to improve standards across the leasehold property industry – not just retirement homes – are also essential, as many fear being fleeced through excessive charges and poor service.

There is also a case for exempting older people from stamp duty on the purchase of a retirement home as an added incentive.

Older people are sometimes criticised for continuing to live in homes that have become far too big for them, and contributi­ng to the housing logjam, but for many there is no decent alternativ­e. It makes sense to offer one.

Industrial blues

ALL the main political parties are now converted to the cause of manufactur­ing.

The bad old days, when even the boss of a chemicals giant like Ineos struggled to get an audience with the then government business supremo Peter Mandelson are gone.

The upcoming Budget is likely to contain measures to help the country’s 9,000 or so mid- sized businesses, many of them in manufactur­ing, as the CBI and the government’s trade supremo Lord Livingston are advocating.

The hope is for the UK to build an equivalent of Germany’s Mittelstan­d of medium-sized manufactur­ing export companies

There is a lot of ground to make up, however.

At the moment, UK manufactur­ing success stories, such as the car industry, actually involve lots of components made abroad – if we want to be more than just an assembly point we need the fully supply chain.

Operators here also spend much more on energy costs than their competitor­s overseas, an issue that has been swept under the carpet by politician­s.

So how are we doing versus Ger- many? Well, two decades ago, German and British manufactur­ing each accounted for around 23pc of the respective economies.

The proportion is the same in Germany but here has dwindled to 11pc.

Some of that is due to the growth in this country of the financial services ‘industry’ in Britain. Even so, those are frightenin­g figures.

Prime suspect

AMAZON has suffered a blow over the marketing of its ‘Prime’ service, highlighte­d in this column last month.

The Advertisin­g Standards Authority ruled that a mailshot containing a card offering a ‘free trial’ for Prime did not make it clear enough that a subscripti­on costing £79 a year would be triggered automatica­lly if customers did not cancel during the 30 day grace period.

The online shopping giant claimed it had spelled out that the free trial would convert to a paid subscripti­on, and that this was common practice.

The latter is true, but so what, it’s still sneaky, and the amount of the subscripti­on fee was material informatio­n that should have been included.

Credit to the ASA for administer­ing a well-deserved rap on the knuckles to arrogant Amazon.

 ??  ??

Newspapers in English

Newspapers from United Kingdom