I bought my first place in 1988, towards the bottom left of this chart on UK housing vs GDP that starts in 1980. As the chart starkly shows, housing price increases have radically outpaced GDP growth whilst also showing negligible growth in housing stock. There is real power in a well-laid-out chart like this, which (literally) graphically shows why my children’s generation has virtually no chance of ever owning their own home unless they have wealthy parents to fund them.
This chart comes from Radix, “The Think Tank for the Radical Centre” in their “Chart of the Month” piece here. Linked from that, they have published their “modest proposals” under the heading “Secure and Affordable Housing for a Thriving Economy“. I like them, they are not modest, they are radical and would shake things up, but also make a lot of sense for the UK economy and for UK society.
Now, the issues in the UK are also similar to Cayman, though in recent years the acceleration of house prices has got even worse due to massive demand from overseas to buy property as an investment and no limits on who and how they do so. Caymanians of my children’s generation also have virtually no chance of ever owning their own homes. As it happens, I am working on my own “modest suggestions” to solve the affordable housing crisis for the thriving Cayman economy, one in which only the wealthy thrive at this stage. The Cayman model used to work for all, but increasingly income and social inequity and inequality is growing. Housing must be solved.
One piece from the Radix article (about the UK) notes: “Government policies such as Help to Buy are like cocaine – they give an immediate high while continuing to embed an entrenched problem of ever-decreasing affordability.” I like to take the best of ideas from different places, learn from their mistakes, and then tailor a new and iterated solution. My own modest suggestion links to some of the core Help to Buy concepts from the UK but is specifically then changed to ensure the benefit to society is not a one-time “immediate high”, but something that makes a real and sustained difference. If you would like to talk about this, whether in or from Cayman or elsewhere, I’d love to discuss it.