Grant Shapps, the housing Minister, has made the courageous (politically) observation in an interview in The Observer that house price inflation is bad and we need stability in house prices, which should gradually reduce to represent a smaller percentage of income outlay. He thinks a roof should be seen as a necessity not as a measure of wealth and should be in reach of every ordinary working person.
This is music to the ears of this Blog which has promoted this view of the true value of housing, the preposterous inflation of which has crashed the economy. It is as irrational to measure wealth by ordinary housing (as opposed to palaces for the rich) as it is do so by wives or goats or pebbles.
Unfortunately the damage done by ludicrous lending policies by banks and building societies over many years, but going out of control in the last ten, will take a generation to pay off. This is because the properties do not actually have this value for real, as any attempt to sell them off in quantity would reveal, but the loans taken out to pay these daft prices are very real indeed and will have to be paid. This will continue to put a brake on the spending powers of families and risks their running up more debt to make ends meet.
That the government now understands the problem, is the best news for quite some time. Many economists are way behind the curve on this and will need to catch up. Maybe they should read my book 2010 A Blueprint for Change. It looks as if the Minister already has. The whole issue is explored with vigour. In stock at Amazon. Hurry….