UK 'squeezed middle' to have hard time

[Hasbara Buster]

UK 'squeezed middle' to have hard time

“We cheered the rise of property prices not realizing that it would destroy, if not our own lives, but the lives of our children.”( file photo)

Asa Bennet, The Huffington Post UK

Britain will be left with a "tiny elite and huge sprawling proletariat" who have no chance of "clawing their way out of a hand-to-mouth existence" in 30 years, a government adviser has warned.

David Boyle, a fellow at the New Economics Foundation think-tank, issued his stark warning as he predicted that rising property prices would effectively render the middle classes extinct as the dream of home ownership becomes ever more distant.

This group of Britons, which politicians have dubbed the "squeezed middle", would need to take three or four jobs just to make ends meet and no longer have time for cultural activities, according to Boyle.

Speaking at the Hay Festival, he predicted that the average house price would hit £1.2 million by 2045, forcing many young people to rent and be "in hock" to their landlord. Meanwhile, research showed that central London property prices have risen by £729 a day over the last year.

Boyle said: “The really scary thing is if in the next 30 years house prices rise as much as they have done in the last 30 years then the average house in Britain will cost £1.2 million."

“We cheered the rise of property prices not realizing that it would destroy, if not our own lives, but the lives of our children.

“The place where this is heading is a strange society with a tiny elite and a long struggling, straggling line which is the rest of us, a new proletariat, who will be in hock to Landlord PLC. We won’t own our own homes, we won’t be able to afford it.

“It will constrain our dreams and constrain the dreams of our children. It’s a new kind of economy where there are no middle classes at all.

“Nobody in society will have the kind of space in their lives, space in their homes, space in their careers for any kind of culture at all, because we will be having three or four jobs to make ends meet. I think it will impoverish society, make it more intolerant and make it more difficult to live.”

Boyle, who was commissioned to lead an independent review into access to public services for the government, said that the rising cost of living would end up polarizing society.

“Very unequal societies are very inflationary societies and in the end it drives out those other degrees in society until it becomes very flat and very desperate," he said.

“You could say that it doesn’t matter and that a more classless society would be a good thing. I think if there is no place in the middle that anywhere can go to claw their way out of desperate hand to mouth existence, and the precariat, then that condemns us all to a precarious existence because there is no ladder.”

Meanwhile, the Office for National Statistics revealed that there has been a 25% increase in households with 6 or more people, and a 25% increase in unoccupied homes.

Dan Wilson Craw, spokesman for the Generation Rent campaign group, said: “Today’s statistics confirm that our broken housing market is creating deep divisions in society – wealthy property owners can afford to leave houses to stand empty, while more people who can’t buy are forced to squeeze into overcrowded private renting.

“The government has no hope of reversing this trend with a scheme like Help to Buy – the nation’s renters need better rights in the rental market if they want to live somewhere they can genuinely call home.”

The Bank of England has warned that the housing market boom could end in another crash, but governor Mark Carney has stood firm on his current plan to only start raising interest rates next spring.

PressTV - UK 'squeezed middle' to have hard time

 

[GreenFalcon]

UK 'squeezed middle' to have hard time

“We cheered the rise of property prices not realizing that it would destroy, if not our own lives, but the lives of our children.”( file photo)

Asa Bennet, The Huffington Post UK

Britain will be left with a "tiny elite and huge sprawling proletariat" who have no chance of "clawing their way out of a hand-to-mouth existence" in 30 years, a government adviser has warned.

David Boyle, a fellow at the New Economics Foundation think-tank, issued his stark warning as he predicted that rising property prices would effectively render the middle classes extinct as the dream of home ownership becomes ever more distant.

This group of Britons, which politicians have dubbed the "squeezed middle", would need to take three or four jobs just to make ends meet and no longer have time for cultural activities, according to Boyle.

Speaking at the Hay Festival, he predicted that the average house price would hit £1.2 million by 2045, forcing many young people to rent and be "in hock" to their landlord. Meanwhile, research showed that central London property prices have risen by £729 a day over the last year.

Boyle said: “The really scary thing is if in the next 30 years house prices rise as much as they have done in the last 30 years then the average house in Britain will cost £1.2 million."

“We cheered the rise of property prices not realizing that it would destroy, if not our own lives, but the lives of our children.

“The place where this is heading is a strange society with a tiny elite and a long struggling, straggling line which is the rest of us, a new proletariat, who will be in hock to Landlord PLC. We won’t own our own homes, we won’t be able to afford it.

“It will constrain our dreams and constrain the dreams of our children. It’s a new kind of economy where there are no middle classes at all.

“Nobody in society will have the kind of space in their lives, space in their homes, space in their careers for any kind of culture at all, because we will be having three or four jobs to make ends meet. I think it will impoverish society, make it more intolerant and make it more difficult to live.”

Boyle, who was commissioned to lead an independent review into access to public services for the government, said that the rising cost of living would end up polarizing society.

“Very unequal societies are very inflationary societies and in the end it drives out those other degrees in society until it becomes very flat and very desperate," he said.

“You could say that it doesn’t matter and that a more classless society would be a good thing. I think if there is no place in the middle that anywhere can go to claw their way out of desperate hand to mouth existence, and the precariat, then that condemns us all to a precarious existence because there is no ladder.”

Meanwhile, the Office for National Statistics revealed that there has been a 25% increase in households with 6 or more people, and a 25% increase in unoccupied homes.

Dan Wilson Craw, spokesman for the Generation Rent campaign group, said: “Today’s statistics confirm that our broken housing market is creating deep divisions in society – wealthy property owners can afford to leave houses to stand empty, while more people who can’t buy are forced to squeeze into overcrowded private renting.

“The government has no hope of reversing this trend with a scheme like Help to Buy – the nation’s renters need better rights in the rental market if they want to live somewhere they can genuinely call home.”

The Bank of England has warned that the housing market boom could end in another crash, but governor Mark Carney has stood firm on his current plan to only start raising interest rates next spring.

PressTV - UK 'squeezed middle' to have hard time

A similar thing is happening in the U.S, It feels like the middle class is merging into the poor class

 

[Hasbara Buster]

A similar thing is happening in the U.S, It feels like the middle class is merging into the poor class

God is punishing the evildoers with their own hands, I love it. This amazing Qur'an verse comes to my mind:

"If We wish to destroy a community, We allow its privileged hedonists to rule it, then they commit evil in it, then it deserves the punishment, then We destroy it completely." [17:16]

 

[mike2000]

I agree with the article. I myself have witnessed how home prices have been rising dramatically these past years. Many of my firends find it difficult to afford buying a house, and basic food items, transport etc keeps increasing, and recently they will be increasing the interest we pay on mortgages as well. So people in the middle income are getting swqueezed little by little with these policies, and there has been a big rise household debt, which is a problem for the economy, as banks are making loans to borrowers who may not be able to repay or we have doubts about whether those households will be able to keep their consumption up if they borrow a lot.
Basically, at the end of a bubble, which is more or less now, the banks raise interest rates. That causes difficulties for people with too little income or too much mortgage. It also means that some people who were looking to buy a house stop looking. These things all depress the price of houses.
This also causes some more cautious people, to sell the house they have before they get into difficulties with the mortgage. This depresses the housing price further. The risk that people are going to default and the actual defaults increase, so the banks increase the deposit that people have to put down and increase the interest rate, which depresses the price of property further.
This fall in price means that some people who can pay their mortgage are in negative equity, and the banks foreclose on them. This depresses the price further still and so on.