By The Landlord Investment Show June 2019 kicked off in earnest yesterday in London Olympia with a crowd-attracting guest panel, including Ken Livingstone, former Mayor of London, moderated by broadcaster and journalist Andrew Neil.
Discussing the topic of “The Future of the UK Housing Market”, the panel included Knowledge and Product editor for This is Money, Sarah Davidson; Less Tax 4 Landlords founder Tony Gimple; Mortgages for Business managing director Steve Olejnik, alongside former London Mayor Ken Livingstone.
The guest panel convened just as Conservative Party MPs gathered in Westminster for the first round of a new leadership ballot. Within minutes of the opening debate, Boris Johnson MP, Ken Livingstone’s successor as Mayor, topped the leadership ballot’s first round, with 114 votes from MPs.
Failure to build homes
The subject of housebuilding dominated discussion during the opening debate at the Landlord Investment Show June 2019. Andrew Neil recounted that successive governments have built fewer homes since the 1970s, despite the population continuing to grow significantly since that period.
Ken Livingstone addressed the topic, saying: “That’s the tragedy of our politicians, when the simple fact is, they’re all terrified of pushing up public spending.”
Sarah Davidson focused on the Labour government’s record, under Tony Blair. Looking at the period of low housebuilding in the late 1990s, she claimed: “If you were being cynical, you could argue that it’s politically driven, in terms of winning votes. People like to feel richer…a very easy way of achieving that is to inflate the value of their homes.”
Ms Davidson clarified this, saying that the Treasury had scrapped the use of the Retail Price Index (RPI) as part of inflation targeting during Gordon Brown’s tenure as Chancellor of the Exchequer during Mr Blair’s time as Prime Minister.
RPI, an inflation measure which included housing costs, was abandoned in favour of an inflation target relative to the Consumer Price Index (CPI). As a result, policy-makers stopped focusing on the housing market when formulating economic policy, as it continued to inflate, in her view.
The Livingstone legacy
During much of the Blair Government’s time in office, Mr Livingstone was Mayor of London, a role he was first elected to serve in 2000 before being re-elected in 2004. His Mayoralty ended when he came second in the Mayoral 2008 election against Boris Johnson. He failed to unseat Mr Johnson when he challenged him for the Mayoralty in 2012.
Property Notify asked Mr Livingstone what he could have done as Mayor to build more affordable homes in London.
Mr Livingstone replied: “The tragedy is, when Tony Blair created the office of London Mayor, there was a clause that said the Mayor will have no responsibility or power over housing…It took my entire Mayoralty to get Tony Blair to lift that…That restriction was lifted just as I lost to Boris.”
When Property Notify asked what he would do in current Mayor Sadiq Khan’s position today, Mr Livingstone referred back to his time as Mayor, claiming he had fostered an environment that encouraged greater housebuilding.
He explained: “When I became Mayor…the planning rule in London was that 25 per cent of homes should be affordable. I raised that to 50…House construction doubled in those eight years. Boris got in, he took it back to 25 per cent, and housing construction declined.”
Mr Neil interjected, stating that official data suggested that Mr Livingstone was incorrect, and that in actual fact, Mr Johnson had seen more houses built during his tenure as London Mayor.
Mr Livingstone lamented the current situation regarding housing, saying: “For decades, we’ve had all politicians, national and local, failing to tackle this housing crisis, and you can damn them all.”
Calls for a shake-up
Speaking exclusively to Property Notify after the panel, Less Tax 4 Landlords founder Tony Gimple dismissed Mr Livingstone’s claims on housebuilding. He said: “It was the usual political evasion. To improve the supply of housing, you’ve got to…want to improve the supply of housing.”
Reflecting on Mr Livingstone’s record on housebuilding as Mayor, Mr Gimple said: “He could have stopped politicising it…the difference between a fairy story and a manifesto is ‘once upon a time’ and ‘if I am elected’. Neither comes true…The fact of actually having a de-politicised housing ministry would give you that longevity.”
He also added: “Planning is no longer a science…the only way to improve the supply of good-quality dwellings…is join up local authorities, planners, developers, landlords…Whoever’s in County Hall or Number Ten will be looking to make sure they get re-elected on populist measures.”
Mr Livingstone went on to say that the increase of housing under Mr Johnston was a result of private development rather than social housing – lets be fair please
I feel sure demand has dropped since brexit as the value of the pound has fallen and some eastern europeans have move to other parts of mainland europe. This is coupled with the eastern europeans suggesting they did not always feel welcome and the exchange rates have effectively reduce their relative income. However, our somewhat backward politicians will be working on historic data so the data they will use will be out of date. For the first time in years I have had a 2 bedroom flat on the market for around 2 months in the medway area and have had no decent applicants wanting to view it, despite it being newly decorated and new kitchen and competetively priced.
As a landlord, you need to meet some of the applicants and ask the right questions.
Recently had a flat that did not get the normal level of enquiries.
Furnished the flat and had two potential tenants within 48 hours.
Worked out that the potential tenants were job starters after University.
So needed furniture.
You as a landlord, are not doing yourself any favours.
You have now lost over £1,000 in rent, that you will never get back.
Total disaster now that us private LL’s are not allowed to run our business anymore. So what’s the point even bothering when ever obstacle has been put in our way & for no other reason than destroy us. John I can well understand it’s more difficult to source Tenants & if you are having trouble being Estate manager & former spokes person for NLA whom I come across years ago, The Gov’ have achieved their objective & collapsed the market. I have a 3 Bed Flat in Acton vacant for months & can’t find Tenants, it’s not that I am a greenhorn and not able to suck eggs having been in the business since 1978. We have been wronged and penalised, criminalised and hung out to dry, good luck to them enjoy the recession.
On the bright side I won’t to pay the 45% tax on the vacant property for the income I didn’t receive, but the way it’s going the’ll probably bring in that to, it would be in line with their policy of tax on nothing.
I am still required to pay full c/tax on vacant property & likely to double next year. It’s wonderful for them to be able to charge for a non-Service.
I too am concerned that the Government has punished all LLs for the sake of the few unscrupulous ones.
I have halved my stock and moved my equity into the TM home investor fund by Hearthstone so I still have my eggs in the residential property market but with less risk and hassle.