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WHAT will our re-elected Tory party do about the housing crisis? To get the answer, you need to look in the annual report. Not the Conservative Party annual report, but the annual report of Bloor Homes Limited, issued just before Christmas.
It might seem a bit obscure to be looking for Tory housing policy in the accounts of one private builder. But property tycoon John Stuart Bloor owns Bloor Homes. And through his other company, JS Bloor (Services) Ltd, Bloor has given the Tory Party £1.6 million pounds.
The Tory party is funded by property moguls like Bloor, so the party will do what they want.
“Follow the money” is supposed to be a journalist’s mantra, because reporters uncovered the Watergate scandal with this method. But political journalists rarely do.
There are a variety of reasons. Lots of top political journalists are not well-equipped to look at company annual reports or financial databases and prefer just reporting what their political contacts told them.
Passing on gossip from your mates is easier than looking at boring figures.
Worse, following the money means you inevitably end up writing about a lot of billionaires and oligarchs. Which is inconvenient for so many reasons — rich people are a lot more likely to sue.
Most senior political journalists earn a comfortable living writing for newspapers which are themselves run by billionaires and oligarchs. Lots of less-well-paid junior political journalists aspire to the same career. So it’s best not to harp on about the political influence of big money too much and scribble down “personality-based” stories instead.
But let’s ignore the gossip and look at the cash. According to the latest Bloor Homes annual report, their turnover went up 15 per cent between 2018 and 2019, rising to £1.1 billion. Profits went up 5 per cent, to £173m. Things are going pretty well for Bloor.
As the annual report of his other company, JS Bloor Services, says: “Current economic conditions create a positive backdrop for the housing industry.” What are those current economic conditions? As we look around us, we see encampments of homeless people in the streets, massive social-housing waiting lists, private renting increasing and the proportion of wages going on housing shooting up.
There is a housing crisis based on a shortage of affordable homes. It really hurts people. But that also means private housebuilders can make big profits by selling smaller volumes of more expensive housing. In 2019 the average price of Bloor Homes houses was £296k — that’s only slightly above the national average for house sales, and somewhat below the average for “new-build” homes.
Bloor is not (unlike some Tory donors) selling “luxury” housing. He is building for the mainstream “new-build” market. But that market does not serve a big slice of the population: £296k is out of reach of many people on average wages.
Bloor is able to make hundreds of millions in easy profit out of shortage. So we can expect the newly elected Tory government to just continue as they are, to refuse to build much “social-rent” housing that might actually compete with the private builders, and to allow “current economic conditions” to continue.
Bloor Homes’ annual report also says: “the housing market has been strong as a result of the availability of mortgage finance products at affordable levels and loan-to-value ratios.” In previous annual reports, Bloor Homes have been more specific, making clear that they benefit from “the government-backed Help to Buy scheme.”
“Help to Buy” is a government-backed mortgage subsidy for new-build homes that has helped some — largely middle-class – people buy houses, but at the cost of keeping house prices high and enriching companies like Bloor Homes. So we can also expect the Tories to ignore their “free-market” principles and stick with this market intervention.
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