What Can Be Done About the Global Housing Crisis? Plenty

Angharad Paget-Jones, de Port Talbot, Wales, never expects to climb the stairs of the house. Despite what the money-saving tips and guidelines on the Internet say, “It’s not as easy as quitting your morning coffee or canceling your Netflix subscription,” he says. Paget-Jones, 28, needs her own home to live. As a person with a disability, you need to adapt your property a lot to improve your quality of life, but you can’t do it in the rental market.

“The goal is to have my own home,” he says. But despite working full-time, he has not been able to save enough to be close to depositing a deposit. The average house price you have been looking at is around £ 180,000 ($ 235,000). He has about £ 3,000 ($ 3,900) in savings, while his rent is £ 675 a month. He is able to save around £ 200 a month, but higher living costs have greatly affected him. “I’m saving a lot more than most people, I understand, but with everything else increasing, it’s not possible to save more than that while I can heat my house and eat,” he says.

Paget-Jones’ situation is far from unique. Home prices are 4.4 times the average disposable income in the United States, the highest level since 2006. In England and Wales, it is 8.9 times, more than 6.7 times a decade ago. Canada is considering banning foreigners from buying homes in the country after the average house price rose to nine times the average household income. The housing market is broken, with more people falling behind in an endless cycle of rents because they can’t afford to set foot on the ladder of housing.

This problem has worsened because those who have the money to invest choose a property in bank accounts after years of low interest rates, leaving the rest to spend their rent income, instead of saving to buy a house. own.

“Global interest rates are quite low has caused house prices to rise around the world,” said Dan Wilson Craw, deputy director of Generation Rent, a UK pressure group campaigning for housing rights. tenants.

“Housing is not housing,” agrees Richard Ronald, professor of housing and professor of political and economic geography at the University of Amsterdam. “Housing is a good investment. It’s a pension. “

It is a problem that countries around the world have recognized and many are trying to fix. “There’s a pretty big deal that the supply and demand equation is very, very unbalanced,” says Remy Raisner, founder of New York-based real estate investment firm Raisner Group and co-author of a report. of the World Economic Forum on the Global Housing Crisis. In the United States, home production has been scarce at around 3 million homes per decade this century.

Some suggest that Japan is the model to follow. There, rental prices have it has largely remained flat for the past 25 years, according to the country’s statistics office. The reason is that the government controls zoning at the national level and is more open to development in the number of homes it allows to build. Just over a third of Japanese citizens rent out their homes, protected by a 1991 law called the Land and Building Lease Act, which makes it difficult for landlords to terminate leases or prevents a tenant from extending their tenancy. rental agreement.

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