Everybody, other than the Chancellor and Prime Minister seems to acknowledge there is a housing bubble growing by the day in London and the South East. Commentators and economists are saying action will have to be taken before there is an almighty crash. The government are not listening. By denying the world is round, the worry is the Bank of England will take matters into its own hands and raise interest rates to cool demand.
The problem with that is the impact it will have on business and the rest of the economy. Once again we will see action taken to sort a problem in London and the south east which will have a disproportionate impact on the rest of the country. There isn’t a housing bubble here in Coventry, yet first time buyers here in Coventry will be hit by a double whammy of higher mortgage payments and job insecurity because employers will cut back on investment.
The answer is to build more houses to deal with the acute shortage we have both in London and the rest of the country. Until the government treat the rest of the country equally, we will continue to see a housing apartheid for our young people coupled with an ever increasing north south divide.
And, before I forget. Let councils build houses too! Not everyone can buy or wants to buy but everyone should be entitled to a decent level of accommodation too often sadly lacking in the private sector. And Labour should commit wholeheartedly to do that at the next general election.