Spread of rents in the UK housing market

Good evening blog readers, I'm in the process of moving house. I'd been meaning to move away from Wembley and closer to work for a while and now, well, to be honest I'm of no fixed abode until I get keys to the new place some time next week.

Anyhoo, it took a while to find somewhere to live. We had a budget, around £800 per month, no more than £900. We wanted a two bedroom place so one room could be an office/studio/den/spare bedroom, but a one bedroom place would be okay if it was nice. I had location stipulations, nearer to where I work in Enfield than Wembley, and also closer to ways into London town centre of gigs an stuff.

Other people in the househunting game have other stipulations, such as, not in the east and near on of those cool west London tube lines.

Here, take a look at RightMove, London doesn't really really cater for the two bedroom less than £800 a month west dweller.

No matter how hard you look, there's always going to be something better in that price range towards the east.

The concept of 'cheap' two bedroom doesn't exist in west London.

Its been a while since I was out looking for a two bedroom flat, in fact last time was around ten years ago, in Glasgow. We got a rather executive city centre flat for £575 a month, that was expensive for Glasgow. But for London, that's not even on the radar for the cheap end of the market.

There isn't even a cheap bit of London with the shittest two bed flats for around that. I know inflation exists, but no no.

Anyhoo, so I like graphs and stuff. I went onto RightMove and started scraping.

This is a graph of the distribution of two bedroom flat rental prices in Glasgow from RightMove. It tells us that if you're looking for a £800 two bed there, you can pretty much get any flat on the market. A shitty flat in a shitty area will cost £400 a month and a decent one will cost £800. Sure there are more luxurious city centre ones over a grand, but most of the market is within your grasp.

Its not just Glasgow that's that cheap, here's a look at the spread in Glasgow and Manchester. Its the same spread.

Sure, Manchester is a touch more expensive. The average being £628 per month compared to Glasgow's £593 per month, but there's not much in it.

Anyhoo, here are all the price spreads that I scraped off of RightMove.

Yes its hard to see what's going on there, suffice to say there's a wide spread of rental prices comparing different cities and towns in the UK. That's kind of obvious to all.

You'll have heard of the north/south divide, or how London is horrendously expensive compared to the rest of the world and it gets cheaper the further from London you go.

So to illustrate this here's a graph of average rent for a two-bed in different parts of the UK, with latitude along the y-axis and price along the x-axis.

The rent floor for the UK seems to be £490 a month. No town has an average rent much below this. Sure, some of the vilest shitholes will be cheaper, and there's always flatshare.

London is generally more expensive than anywhere else in the UK. Even the cheap bits of London are more expensive.

Here's a wee graph of the spreads of various places in that expensive latitude around London.

I've cut off the x-axis at £1500 per month cos above that it gets rather depressing. Do you really want to know that the average rent in West Hampstead is £1710 a month an Tower Hamlets is £1570? Around three times more than double the average in most of the UK.

The other day Raedwald blogged about how Middlesbrough was well cheap, you could buy a four bedroom house there for £132,000. But that still not quite scraping the barrel.

I use to joke with people that I could quit my job and move to Hull and live in a nicer flat just on my Job Seekers allowance. But it appears there are cheaper places than even Hull. Carlisle for example.

Here, this is my wee list of the average 2-bed rent in various places in the UK.

£1,711.15 - West Hampstead
£1,569.78 - Tower Hamlets
£1,530.41 - Bethnal Green
£1,394.95 - Brixton
£1,252.63 - Wembley
£1,173.56 - Brighton
£1,144.02 - Enfield
£1,093.44 - Uxbridge
£1,031.45 - Walthamstow
£955.47 - Croydon
£874.05 - Reading
£869.32 - Slough
£828.37 - Chelmsford
£783.09 - Edinburgh
£775.00 - Burnham on Crouch
£755.04 - Portsmouth
£736.06 - Bristol
£692.54 - Plymouth
£668.94 - Cardiff
£666.67 - Birmingham
£664.54 - Colchester
£648.22 - Newcastle upon Tyne
£645.89 - Norwich
£627.92 - Manchester
£617.50 - Leicester
£606.42 - Liverpool
£597.65 - Sheffield
£592.19 - Glasgow
£581.67 - Swansea
£578.26 - Moss Side
£576.36 - Nottingham
£553.09 - Coventry
£516.23 - Doncaster
£507.14 - Bolton
£504.90 - Rochdale
£504.41 - Middlesbrough
£497.64 - Bradford
£496.24 - Hull
£479.17 - Carlisle

Thrilling stuff, I'm sure you'll agree.

Does this open up some interest questions about the nature not just of Housing Benefit, but also Job Seekers Allowance in the UK, and who pays for who.

**UPDATE**
Playing around on Excel instead on OpenOffice Base, I've put together this surface graph of the spreads in each of the aforemention towns, and done it so it looks a little like the cover to Joy Division's Unknown Pleasures.

Its going to be a wee while until I can get on a 'puter that can run better graphing software.

Redistributing wealth

There was an epic post over at Devil's Kitchen the other day, pulling together Guardian pieces, Tim Worstall and Ol' Blue Eyes, covering the government's proposed cap on Housing Benefit. Therein the Devil summarises the problem by quoting a comment from the Guardian piece.

To sum up, some people are effectively being given a pre-tax income of £77,000 for doing nothing, and people far poorer than that are paying for it through taxation. The chancellor claims this is unfair and you disagree. Right.

The case point being that housing benefit is paid based on average rents in each area, so in posh Camden unemployed folk, folk on low income, foreigners and the incapacitated can claim £1000 a week or so, paid for out of the tax that everyone else has to pay.

After discussing the issue with people who know about this sort of thing, and my own wee flag I like to wave about how you can pretty much buy a house in Hull if you're on Job Seeker's Allowance, it seems that the problem lies in the 'Local Connection' section of the 1996 Housing Act, which essentially penalizes claimants and councils who seek better value further afield.

I suggested doing something about this one the government's Spending Challenge website.

So I was rather surprised this morning to read on the BBC that the government were acting on my suggestion.

Alas, I didn't bother reading the article until later. The thrust seems to be to move unemployed folk from poverty ghettos to more affluent areas, which is kind of the opposite of what I had in mind.

JAY'S POLITICAL BLOG reads it as:-

On the surface, this idea is not bad in itself. Many people do move to wherever a job takes them. But as Mr Balls says, the coalition has already cut millions of pounds from funding for the jobless. He is absolutely right to accuse the Tories and the Liberal Democrats of taking money away from the poorer regions whose economies need regeneration; a move which will, in turn, only serve to slow the overall economic recovery, if not take Britain back in recession.

By encouraging people to move to more prosperous areas where the jobs are more likely to be, that is exactly what the Conservative-Liberal coalition are doing.

My take is that in Hull you've got fourth generation unemployed people, the cost of living is very low, the housing benefit bill per claimant is low compared to Camden, Westminster and Islington.

So, if you've got unemployed and unemployable people, why keep them in broom cupboards in the most expensive areas when they could quite merrily have a higher standard of living and more space elsewhere.

What could happen is that the Tories and the Liberal Democrats would be taking housing benefit money away from the richer regions and moving it to the poorer areas.

Me, I used to live in expensive West Hampstead, I had a nice job and could afford it, unemployment got me, my self-confidence was shot to fuck, I moved five miles west to Wembley where rent was so much cheaper and I could survive on minimum wage until my self-confidence rose to the heady heights it is today.

I'm fucking great me.

Taxpayer hours 2010

Yes, I know the government are soon to announce the emergency budget with its inherent tax rises and spending cuts. But to help you rationalise the figures, the millions and billions of pounds, I've done some sums.

• Median weekly income these days is about £497
• Tax freedom day was 30th May
• That's about 41% through the year

Therefore:-

• One taxpayer hour is £5.10
• One taxpayer week is £204
• One taxpayer year is £10,600

So when the government spends £1,000,000, it takes about 94 people working for a year.

Thrilling stuff, I'm sure you agree.

Cashing in while they still can

God knows where I read it, but there was a thing about whats going down in Greece where civil servants get paid a huge lump sum when they retire, and they can retire from the age of 45, its all unsustainable and as a result of the government trying to do something about it, the country is on fire and dragging the European Union into the flames.

Anyhoo, elsewhere in the European Union, on the sunny shores of Camden, Jim Wintour, the Housing Director chap, has resigned from his £158,000 a year job. Tracy suggests three reasons:-

Much speculation as to why he quit:

A. He finally met and experienced first hand the gaggle of truly awful graspy, lying, devious so-called 'leading' tenant reps we have lurking about in Camden and thought 'what the fook get me out of here'.

B. He has taken the fall for a workforce that is a law unto itself.

C. He made the mistake of giving interviews to a local newspaper and admitted that the council was at fault over a matter to do with the housing of a local disabled woman who died in her council flat. This type of behaviour (displaying a degree of integrity) is wholly unacceptable when working for the 'firm' and will be punished accordingly.

I've heard differently, that he actually emailed out his reasons for leaving to all the council employees, that like in Greece, Jim Wintour heard that the powers that be were going to be tinkering with retirement packages, so he's jumped to maximise his pension.

However much is in his pension pot must dwarf the £158,000 he's currently on.

NHS cuts

I know its controversial, but I don't see anything wrong with cutting NHS budgets. Its not going to affect front line staff much, most people will barely notice.

I don't mean uniform cuts across the board, 10% off every department budget, just a couple of well placed drastic cuts. Here, look at this graph.

Can you envisage cutting GPs pay by 50%, so it has parity with MP's pay again? Same comparitive remuneration as they had before 2002?

There's about 36,000 GPs in the UK, so currently they get paid a total of about £4,500,000,000. The total NHS budget is around £102,000,000,000. So aye, cutting GP's pay by 50% would cut the NHS total budget by about 2%.

Maybe, this is a little heartless and before 2002 GPs were woefully underpaid, and its only now that they're paid as much as they're due.

Up until very recently I was working in a sandwich factory making sandwiches for minimum wage, I feel I was woefully underpaid for the job I was doing. Without sandwich makers such as myself thousands of office workers would starve, should I have been paid more?

Budget 2010 - Working Tax Credits

Not much for me to say about today's budget in Parliament, except the Times has an infograph saying the government are paying out £3.9billion and taking in £3.3billion. I'm not sure what the context is, but it looks like they're spending beyond their means.

Anyhoo I had a go at the BBC's budget calculator, and cos of my car, I'm about £10 better off but because of my Working Tax Credits I'm about £400 worse off. Not cos of the budget, mind, but cos I'm overclaiming this financial year. Now I'm on £54 a week, next financial year what I'll get is a lot lower, £14 a week. I'll have to tighten my belt a bit more.

There's something really wrong with Working Tax Credits. If you're on a low income you get paid money by the government, but you also pay income tax. At £10,200 annual gross earnings it reaches parity, you pay the same amount in Income Tax and National Insurance that your receive back in Working Tax Credits.

People who understand these things better than I will tell you that for low earners the marginal tax rate is near 100%. I'm not quite sure what that means, but I reckon if I get a wee pay rise for my £10,000 job, in return for working harder or more responsibility, the amount I take home barely increases. Working Tax Credits are a disincentive for promotion and hard work.

The personal tax allowance has frozen in this budget, so if I get an inflationary pay rise, that'll be taxed more.

Now the thing that's nagging in my head is that I used to feel guilty about claiming Working Tax Credits, they're a grubby con of a financial measure, so for months I didn't claim it at all. I'm not the only low earner not claiming.

Last year, 3rd November 2009, Hansard has Alistair Darling saying amongst some groups take-up is 81%. Wikipedia has info from 2004 that of the 7 million people entitled to Working Tax Credit, 2 million do not claim it.

So in terms of the net amount of tax/NI/working tax credits that the government gets, if you're earning that breakeven point of £10,200, the government gets nothing. But if 19% of people on £10,200 don't claim Working Tax Credits, then the government gets free money, and the people lose out.

In another world, if the government abolished Working Tax Credits and just raised the personal allowance to the break even point, there'd be no one losing out at that break even point. The government wouldn't be able skim off from people who didn't take up the Tax Credits.

And that's why they're there, to provide cracks for people to lose money down.

**UPDATE**

Time passes, I get home and feel less guilty about spending time drawing graphs. Here, I was playing with the BBC Budget Calculator, and thought you might like this if, like me, you earn less than £14,000 a year.


Gross Income % you keep
£4,000 167.75%
£6,000 144.65%
£8,000 119.21%
£9,000 109.30%
£9,500 105.13%
£10,000 101.37%
£10,250 99.64%
£11,000 95.45%
£12,000 89.48%
£13,000 84.90%
£14,000 82.74%