The high cost and low availability of housing is already
causing political trouble. It is one of the arguments used by UKIP for pulling
out of the EU and controlling immigration. The housing mess is also prompting Britain's
mainstream political parties to come up with foolish policies. The
Conservative-led government's flagship scheme - Help to Buy -helps people who
wouldn't otherwise have a big enough deposit to buy a home. Its main effect
will be to increase demand further, so pushing up prices, rather than increase
the supply of homes. Meanwhile, the opposition Labour Party has promised to
institute a type of rent control if it comes to power. That sounds nice for
tenants. But it too would rig the market, deterring landlords from building new
homes to rent. A better solution is not to distort the housing market
but to remove existing distortions so that it operates more freely. Read more
on the Yahoo! Finance website.
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