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	<title>Comments on: Commenting on Government Plans to Regulate Banks and Reign in Personal Debt</title>
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	<description>Cambridge, United Kingdom.</description>
	<pubDate>Sun, 14 Mar 2010 21:44:06 +0000</pubDate>
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		<title>By: David Vincent</title>
		<link>http://www.rtaylor.co.uk/commenting-on-government-plans-to-regulate-banks-and-reign-in-personal-debt.html#comment-13078</link>
		<dc:creator>David Vincent</dc:creator>
		<pubDate>Fri, 03 Jul 2009 06:14:34 +0000</pubDate>
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		<description>Home ownership becomes a problem when it is seen as the first choice investment for generating personal wealth. Rampant house price inflation distorts any other investment decisions individuals might make, particularly if the profit is untaxed. I am all for encouraging "wealth creation". Someone who buys a house and sits there simply waiting for it to increase in value is not a "wealth creator" in the sense you mean. I see no problem with taxing their profits and using that money to generate other forms of housing. 

I am not sure how you estimate what "the market demands" in terms of a housing rental market, because there are so many factors that distort that market. At the moment, for example, housing developers are declining to build houses. This is not because there is no demand for them, it is because they cannot sell them for a high enough profit. The reason people are not buying houses is because people will not lend them money, not because they do not want (or need) houses.  (As the old saying goes, a hungry man with no money has a "need" for food, but no "demand"). There are some 7000 households on the Council housing register, so there is clearly a demand for affordable social housing. I would be quite comfortable with a situation where less than half the households in the UK were owner-occupiers (a proportion that is common in other parts of Europe). My landlord of choice would be local authorities, because they are generally more reliable and more accountable than either private individuals or housing associations. Like you, I don't really want rich landlords profiting from their tenants, although I do think as a rule that institutions make better landlords than individuals (the "mom and pop" end of the rental market).</description>
		<content:encoded><![CDATA[<p>Home ownership becomes a problem when it is seen as the first choice investment for generating personal wealth. Rampant house price inflation distorts any other investment decisions individuals might make, particularly if the profit is untaxed. I am all for encouraging &#8220;wealth creation&#8221;. Someone who buys a house and sits there simply waiting for it to increase in value is not a &#8220;wealth creator&#8221; in the sense you mean. I see no problem with taxing their profits and using that money to generate other forms of housing. </p>
<p>I am not sure how you estimate what &#8220;the market demands&#8221; in terms of a housing rental market, because there are so many factors that distort that market. At the moment, for example, housing developers are declining to build houses. This is not because there is no demand for them, it is because they cannot sell them for a high enough profit. The reason people are not buying houses is because people will not lend them money, not because they do not want (or need) houses.  (As the old saying goes, a hungry man with no money has a &#8220;need&#8221; for food, but no &#8220;demand&#8221;). There are some 7000 households on the Council housing register, so there is clearly a demand for affordable social housing. I would be quite comfortable with a situation where less than half the households in the UK were owner-occupiers (a proportion that is common in other parts of Europe). My landlord of choice would be local authorities, because they are generally more reliable and more accountable than either private individuals or housing associations. Like you, I don&#8217;t really want rich landlords profiting from their tenants, although I do think as a rule that institutions make better landlords than individuals (the &#8220;mom and pop&#8221; end of the rental market).</p>
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		<title>By: Richard</title>
		<link>http://www.rtaylor.co.uk/commenting-on-government-plans-to-regulate-banks-and-reign-in-personal-debt.html#comment-13033</link>
		<dc:creator>Richard</dc:creator>
		<pubDate>Thu, 02 Jul 2009 17:32:03 +0000</pubDate>
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		<description>David, 

I want to do all I can to make housing more affordable and I agree with much of what you have said. 

I do not though see home-ownership as a problem. I do not think the state ought own more homes than it does now; I'm a supporter of a small state and giving people the freedom to make their own choices about how they spend as much of their money as possible. 

I would also not like to see a position where more rich individuals or companies owned more homes, and profited from more people living as tenants. 

The rental sector is a critical component of our housing stock; it provides flexibility allowing people to move and follow work for example, but I wouldn't want to see any efforts to expand it beyond what the market demands. 

It is best for the country as a whole to encourage innovation, entrepreneurship, and business, increasing capital gains tax or any other tax reduces the incentive to generate wealth. Taken to an extreme, and oversimplifying things - there is a balance to be struck between us all being equal but poor in this country and allowing people to make money at the expense of a more fragmented society.

I too want a revolution, I want fundamental reform, I want affordable housing. We need a flatter taxation system, it is awful that some of the lowest paid people pay the highest proportions of their income in tax at the moment, but we've got to be careful not to deter wealth creators from living in and contributing to the country.</description>
		<content:encoded><![CDATA[<p>David, </p>
<p>I want to do all I can to make housing more affordable and I agree with much of what you have said. </p>
<p>I do not though see home-ownership as a problem. I do not think the state ought own more homes than it does now; I&#8217;m a supporter of a small state and giving people the freedom to make their own choices about how they spend as much of their money as possible. </p>
<p>I would also not like to see a position where more rich individuals or companies owned more homes, and profited from more people living as tenants. </p>
<p>The rental sector is a critical component of our housing stock; it provides flexibility allowing people to move and follow work for example, but I wouldn&#8217;t want to see any efforts to expand it beyond what the market demands. </p>
<p>It is best for the country as a whole to encourage innovation, entrepreneurship, and business, increasing capital gains tax or any other tax reduces the incentive to generate wealth. Taken to an extreme, and oversimplifying things - there is a balance to be struck between us all being equal but poor in this country and allowing people to make money at the expense of a more fragmented society.</p>
<p>I too want a revolution, I want fundamental reform, I want affordable housing. We need a flatter taxation system, it is awful that some of the lowest paid people pay the highest proportions of their income in tax at the moment, but we&#8217;ve got to be careful not to deter wealth creators from living in and contributing to the country.</p>
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		<title>By: David Vincent</title>
		<link>http://www.rtaylor.co.uk/commenting-on-government-plans-to-regulate-banks-and-reign-in-personal-debt.html#comment-13026</link>
		<dc:creator>David Vincent</dc:creator>
		<pubDate>Thu, 02 Jul 2009 16:47:27 +0000</pubDate>
		<guid isPermaLink="false">http://www.rtaylor.co.uk/?p=1616#comment-13026</guid>
		<description>On the question of house prices, what is needed is a fundamental shift in attitude so that a house is again regarded as something to live in, rather a real or potential source of wealth. House price inflation causes vast divisions in society, whereby those who own houses increase their wealth through no effort of their own, and those who do not own houses are more and more excluded from this increase in wealth (which is, of course, untaxed as well as unearned). This is what creates the sense of desperation that leads to people having to get on this "ladder" we keep hearing about, and the collusive and fraudulent applications for mortgages that fuelled the lending boom. Lying about your income to get a mortgage was one of those middle-class crimes to which one was expected to turn a blind eye (whereas lying about your income to get social security benefits is regarded as fraud and punishable by imprisonment). It is now quite clear that those who were making those fraudulent statements - and those who encouraged them to do so for the sake of commission - ended up costing the nation quite as much as any "scroungers".  I wish I thought that any government would ever introduce the necessary tax reforms to counter the obsession with owner-occupation (capital gains tax on sale of all homes - rather than just second homes - would be a start) and use that to fund the necessary social housing, but I suspect the vested interests of those who already own property will always counter any fundamental reform.</description>
		<content:encoded><![CDATA[<p>On the question of house prices, what is needed is a fundamental shift in attitude so that a house is again regarded as something to live in, rather a real or potential source of wealth. House price inflation causes vast divisions in society, whereby those who own houses increase their wealth through no effort of their own, and those who do not own houses are more and more excluded from this increase in wealth (which is, of course, untaxed as well as unearned). This is what creates the sense of desperation that leads to people having to get on this &#8220;ladder&#8221; we keep hearing about, and the collusive and fraudulent applications for mortgages that fuelled the lending boom. Lying about your income to get a mortgage was one of those middle-class crimes to which one was expected to turn a blind eye (whereas lying about your income to get social security benefits is regarded as fraud and punishable by imprisonment). It is now quite clear that those who were making those fraudulent statements - and those who encouraged them to do so for the sake of commission - ended up costing the nation quite as much as any &#8220;scroungers&#8221;.  I wish I thought that any government would ever introduce the necessary tax reforms to counter the obsession with owner-occupation (capital gains tax on sale of all homes - rather than just second homes - would be a start) and use that to fund the necessary social housing, but I suspect the vested interests of those who already own property will always counter any fundamental reform.</p>
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