1. to GET house prices DOWN, increase supply.
2. The logic seems UNARGUABLE
3. Britain’s house prices have INFLATED
4. BARRIERS TO CONSTRUCTION, such as the GREEN BELT—zones of PROTECTED COUNTRYSIDE around cities—are clear to see.
5. overcome NIMBYISM and build more houses
[ˈnɪmbi]邻避主义
6. That would ARREST A DECLINE in HOME OWNERSHIP that has been particularly SHARP among young people.
7. OWNED PROPERTY
8. SO GOES THE CONVENTIONAL WISDOM.
9. But even as POLICYMAKERS have at last begun to EMBRACE BUILDING, a new school of thought has GAINED PROMINENCE.
10. Its advocates, THE MOST VOCAL OF WHOM IS Ian Mulheirn of Oxford Economics, a consultancy, say HIGH PRICES HAVE LITTLE TO DO WITH supply shortages.
11. They PUT THE BLAME SOMEWHERE ELSE: global financial markets.
12. LINK a 1% increase in the number of houses TO a fall of around 2% in prices.
13. supply constraints cannot EXPLAIN A BOOM AS BIG AS BRITAIN’S.
14. THE TRUE EXPLANATION, THE ARGUMENT GOES, IS found by viewing a house as a financial asset.
15. It produces IMPLICIT INCOME: the SAVING ON rent achieved by owning the property rather than renting it (or equivalent DIGS) from a LANDLORD.
16. Like ALL STREAMS OF INCOME, this can be valued using an interest rate.
17. just like the DIVIDENDS offered by STOCKS, or the COUPONS offered by BONDS, monthly savings on rent, CAPITALISED AS HOUSE PRICES, have SOARED IN VALUE as global real interest rates have TUMBLED
18. house prices should be BID UP until the cost of home ownership—which includes mortgage interest, as well as the LOST OPPORTUNITY TO invest in something else—is about EQUAL TO RENT.
19. Over two decades the real cost of capital has roughly HALVED, says Mr Mulheirn.
20. TO BID PRICES UP TO THE POINT where RENTAL YIELDS ARE COMPARABLE TO bond yields, households need SUFFICIENT ACCESS TO mortgage credit.
21. That might not have been available, WERE IT NOT FOR the “financialisation” of housing—the liberalisation of mortgage lending, sometimes FUNDED BY FOREIGN CAPITAL
22. One such reform was THE ADVENT OF BUY-TO-LET mortgages in 1996, which made it easy for individual investors to speculate on property by becoming landlords.
Buy-to-let is a British phrase referring to the purchase of a property specifically to let out, that is to rent it out.
to make a hypothesis about something.
23. Foreign investors may also have CONTRIBUTED TO THE FRENZY.
24. how to TELL if there is a housing shortage?
25. One way is to look at rents, which MEASURE ONLY THE SUPPLY AND DEMAND FOR A PLACE TO LIVE, without any FINANCIAL COMPONENT.
26. They paint a STARTLINGLY different picture.
27. Even in PRICEY London, they are up by less than 4%.
28. Some CAVEATS [ˈkæviæt] are necessary.
29. Falling real interest rates are a global phenomenon.
30. IN POSH BITS OF north London they are below 3%; IN, SAY, PARTS OF Liverpool they can exceed 10%.
31. Such places would BENEFIT GREATLY FROM more supply, with KNOCK-ON EFFECTS ON national economies.
32. High house prices in London may REFLECT AN EXPECTATION THAT building constraints will BITE HARDER in future AS THE CITY CONTINUES TO THRIVE, CAUSING RENTS TO ACCELERATE.
33. because predictions of FUTURE CAPITAL GAINS tend to be WHAT INFLATE AND SHRINK PROPERTY-MARKET BUBBLES.
34. experienced huge PROPERTY-PRICE BOOMS
35. Decades of low rates have not RESTORED Japanese house prices TO THE HIGH they reached AMID THE SPECULATIVE FERVOUR of the late 1980s and early 1990s.
36. That is to build on Mr Mulheirn’s logic, however, not to DEMOLISH it.
37. the risk of SPECULATIVE OVERHEATING is another reason not to FOCUS ON SUPPLY.
38. LEAVING BEHIND GHOST TOWNS OF VACANT HOMES
39. Suppose financialisation and low interest rates are to blame for high prices. What, then, should policymakers do?
40. But they also have LOWER RATES OF HOME OWNERSHIP.
41. That would not APPEAL TO politicians in Britain, where “GETTING ON THE PROPERTY LADDER” is seen as CRUCIAL TO financial security.
a series of stages in owning property in which you buy a small house or apartment first, and then buy a bigger or more expensive one when you have enough money
42. Buy-to-let investors can be discouraged—indeed, Britain has HIT THEM WITH much higher taxes in the past couple of years.
43. PROFESSIONAL FIRMS WITH LARGE PORTFOLIOS and ACCESS TO capital markets can replace individuals.
44. Increases in government SUBSIDIES FOR homebuyers will only INFLATE PRICES FURTHER.
45. A SENSIBLE APPROACH WOULD BE TO build more where rents are rising, make life easier for tenants—and abandon the notion that buying a home is A RITE OF PASSAGE.
a ceremony or event marking an important stage in someone's life, especially birth, puberty, marriage, and death.
46. if housing were to UNDERPERFORM FOR A WHILE.
47. Indeed, an implication of the financialisation thesis is that rising interest rates could PUT THE DECADES-LONG HOUSING BOOM INTO REVERSE.
48. SURE ENOUGH, housing markets in rich countries have begun to look WOBBLY as global interest rates have CREPT UP.
49. the prospect of Brexit is also HITTING DEMAND,
50. Perhaps young people trying to SCRAPE TOGETHER TOWERING DEPOSITS to buy their first home should hope that the supply SCEPTICS are right.
If you scrape together an amount of money or a number of things, you succeed in obtaining it with difficulty.
51. the problem of high house prices might disappear ON ITS OWN.
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