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Supporters of London house price crash are missing bigger picture


UK’s economic future requires more than one city to boast full gamut of jobs. That takes planning

Supporters of a crash also fail to ask the question: why have property prices risen in London and the south-east?
Supporters of a crash also fail to ask the question: why have property prices risen in London and the south-east? Photograph: Dominic Lipinski/PA

The warning that property values in London will fall this year and next will bring a smile to many who believe house prices have run out of control in the last 30 years.

The added warning of a possible full-blown crash in the capital if Britain leaves the European Union without striking a deal will only turn the smile into a beaming grin. For some it is enough to persuade them that a no-deal Brexit is the best thing that could happen to the country.

And it’s a seductive position to adopt. A crash would make homes more affordable to those on lower incomes and the young. Profit-hungry housebuilders would see their revenues collapse and the much-reviled estate agency industry would shrink.

A one in three chance of a “significant correction” in London prices, which is the considered position of 30 property experts, is good odds for anyone who wants prices to fall. So let’s press on with a hard Brexit. There is much to gain.

Except that such thoughts are the indulgence of better-off radicals and intemperate curmudgeons: those who will be largely immune to the cost of Brexit by virtue of their job or age (or retirement) and who have huge equity in their home.

They care little about the after-effects of a house price crash because while it may reduce their wealth somewhat, it won’t materially affect their bank balance.

Unfortunately, damaging the economy, as Brexit surely will, to reduce house prices will leave many others in a position of putting in an offer on a cheaper home only to lose their job.

Supporters of a crash also fail to ask the question: why have property prices risen in London and the south-east? If it is Russian oligarch money being squirrelled away from Vladimir Putin’s grasp, then tackle money laundering with greater vigilance.

If it is the growth of the population, and this must be the heart of the problem, then spend a few extra billions attracting employers to the regions.

As the Centre for Cities thinktank is tired of telling ministers, the health of a town or city depends on the state of its jobs market. Almost everything else flows from it; from the mental health of the local population to the state of the high street. It is a given that good jobs lie at the heart of an economy and the ones we have need to be spread around.

But that would involve planning. Something that is an anathema to this government. The kind of planning that needs cross-party support and the backing of the new metro mayors. When cities lie at the heart of every country’s economic future, Britain needs more than one that can boast the full gamut of jobs, including that of a FTSE 100 boss.

Aston Martin benefits from taking the upmarket route


Aston Martin has always had a fan in Jeremy Clarkson, the former Top Gear and now Grand Tour presenter. Even when the West Midlands carmaker was trying to persuade potential customers that two V6 Ford engines bolted together under the bonnet, which were slower and less responsive than a Ferrari or McLaren equivalent was a good buy (this was only in 2016), Clarkson raved about the indefinable romantic qualities on display.

Those were the days of make-do and mend and underinvestment. It made for a niche carmaker that sold to enthusiasts who could afford the almost constant repair bills.

The transformation from a £500m car company when Ford sold it in 2007 to a £5bn business today comes after years of painstaking investment that now mean Aston makes its own combustion engines in Warwickshire and is poised to begin making its own electric engines in Wales.

New boss David Richards, and his Kuwaiti backers, promised to take James Bond’s favourite ride “to even greater heights” and it seems they have done just that.

As potential shareholders size up the company before a stock market listing, they will admire the way Richards has lured the wealthiest car buyers from China to the US and Russia to Dubai with a combination of romance and horsepower.

It’s a lesson not lost on most of Britain’s engineering firms, which have spent much of the last 30 years going upmarket. As the top 1% of earners have pulled away from everyone else, it makes sense to make stuff that satisfies their expensive desires.

Britain has always done well selling super-yachts. Now its back in the game of making supercars.

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