Noughts add up to something

Property is both a player in, and barometer of, our national economy. The Royal Institution of Chartered Surveyors resident economist commented this week, that the company results from several of the major builder/developer companies, such as Barratt, showed little signs of optimism. He added that most were reducing their ‘inventory’. In other words, they were selling what they had already built and not replacing it. Additionally, they were off-loading chunks of their land-banks, wherever a buyer could be found. This reflects the recent press comment, that would-be house owners wanting to build for themselves, now stand their best chance of finding a site by buying a plot on a partially built and now mothballed development.
Over the next 10 weeks or so, as pre-election claim and counter claim about the economy are made, there will be much talk about millions and billions. Government has become conditioned to thinking and dealing in billions, to such an extent that the enormity of such amounts has lost its impact. My calculator does not cope with billions, so I had to resort to pen and paper to try to find some understandable relationship between millions and billions. Instead of pounds or dollars, I used time as a measure. I calculated that a million seconds was about 11 days, whilst a billion seconds was over 31 years!!
I found that comparison quite scary. All the more so when Treasury figures tell us that the national debt is rising by £1 billion every 2½ days. That fact alone should demonstrate that there is no scope for delayed action. This nation exists on borrowed money and if those who are doing the lending lose confidence in our ability to repay, they will not only stop lending but also want their money back.
Politicians point a critical finger at bankers, saying that they acted irresponsibly for their own gain. This is true, but also hypocritical, because those same politicians have similarly acted irresponsibly for political and ideological gain – the only difference being that the politicians were using our money.
It is unfortunate that the prudence of 50 years ago has been air brushed away by PR men and a PC culture. Personal debt is now called ‘credit’ and is marketed as a positive asset. Bad debts are called ‘impaired loans’. Bankruptcy has lost its stigma. The average UK household owes £57,888 and last year a home was repossessed every 11 minutes. Recent Governments have pioneered this culture of living beyond means. They have cynically bought public approval by spending more than they could raise by taxation. Each and every MP is responsible for allowing such debts to build up and those who meekly followed the Party line are as guilty as a compulsive gambler staking his granny’s pension.
The Cabinet minutes of the first post war Labour Government, record Clement Attlee as PM, questioning the cost of the proposed NHS and asking fellow members of his Cabinet “whether we are morally justified to require such weekly deductions from a working man’s wages”.
The option shortly facing the electorate is simple – do we suffer a lingering and increasingly uncomfortable economic death, or do we amputate swiftly and hope that rehabilitation is successful. As a Country, we need to stop living on virtual money and start adding permanent value agriculturally, industrially and technologically. Individually, despite the grim outlook, buying one’s home is the start of building a sound, personal, economic foundation and gaining some protection from the effects of dud government.
©February 2010

NOTE:
The writer is an independent chartered surveyor and has no connection with any firm of estate agents or surveyors. For reasons of client confidentiality he writes under a pseudonym. Comments and enquiries are welcome and may be sent c/o Wealden Advertiser Property, Gardens & Interiors.

Print this page