Where do we go from here?

Where I live we have a very good free paper The Blackmore Vale Magazine. It is packed with all kinds of local information and of course advertiesments, which are what pay for it to be free, of course. It comes out on Fridays (or later, if the lad who delivers them on our road can't persuade his mother to do it for him when he doesn't feel like it) and I like browsing through the various sections, ending up with the Property section at the back. We have no intention of moving, but you know how it is.

At this time of year in any rural area the property market is active, because rural living looks much more attractive when there isn't mud all over the place and silage spreading. I find myself amazed at the prices being asked for properties in Dorset now. Until Poole became a major port when containerisation developed, Dorset was a very poor area, with farming and tourism its only industries. So house prices were pretty low, and they remained like that right up until the 1990s. We have no motorway (thank goodness!) and only the one rail link along the south coast (Waterloo to Weymouth) and one along the northern boundary (Waterloo/Paddington to Exeter). So we were free from the worst of the London commuter overspill.

All that has changed with the coming of internet working. One of my neighbours worked in London for a while and commuted daily via Salisbury. It nearly killed him and did not do his home life any good, so he now workes for less money in Poole. But other neighbours work in the City part-time and the rest of the time via the internet, and yet others visit the US to work regularly, although they all consider themselves to be "Dorset residents." And that's not counting the thousands of second-home owners who found they could not afford to buy in the New Forest or the Cotswolds.

The local estate agents have been quick to capitalize on this. Some of them boast that they have London offices or affiliations, so that they can get London prices. I cannot understand why anyone would think this a good thing? That means that you have to pay London prices when you buy as well as when you sell, with knock-on results that we can now all see. I estimate that over half the village where I live is now owned as second-homes. The shop and the garage and the Post Office have closed down. Nearby villages show the same pattern. "Starter homes" are an unbelievable price even when new; if you want to buy anything period, even if it needs "total refurbishment", ie is derelict, the price tag starts at £200k and climbs.

And all this has happened so quickly that local wages just haven't caught up. When we bought this cottage, nine years ago this year, we paid under £100k for it and it is detached and has three/four bedrooms and a good-sized garden, although admittedly it is on a main road. The cottage over the road, with much less land but a similar size, was marketed at the same time for £65k but we didn't want it because of the lack of garden. That was a second home, incidentally. The person who bought it kept it for several years, did no improvements, then took advantage of the boom in prices and sold it on for £295k!!! Okay so it is a first home now, but the present people will want to recoup their outlay when they sell on and this must be happening everywhere. In this little free magazine, I see many properties for sale at over half a million, and a quarter-million seems to be an average price for anything larger than a boot cupboard on a bypass. I do not think that, this week, there is anything advertised at under £100k, and that includes flats.

Thinking about all this, I realised that actually the house market in Britain is behaving normally. To own your own home has always been an impossible dream for most people, except when Margaret Thatcher promoted the right-to-buy of Council houses. That released millions of properties into the private market, but more importantly, it promoted a change in people's expectations.

When I was young I went from school to university, which meant I left home, and after university I entered a profession. I expected to have low salaries for years as I worked my way up, and in consequence to have to live cheaply, in bedsits and rented, shared flats. Everyone lived like that if they didn't live at home until they were married. People in their twenties never dreamed of owning their own properties. Working-class people, if that is not an invidious term, knew they never would. That was what Council houses were for. Nowadays people feel aggrieved if they can't in youth "get onto the property ladder". They seem to accept levels of debt commitment - a mortgage on top of repaying further education fees - that would have scared the pants off my generation. Not that anyone would have lent us such vast sums anyway.

But the Council houses are not there any more. And if you look at the private rented sector, costs are again unbelievable to someone of my age. I see properties in the Magazine on the market for over £2 000 per month!! Who on earth earns that kind of money, that they can pour it down the drain, because that after all is what you do when you are renting. Nevertheless, estate agents will say that somebody must be able to afford these sums of money, because they are paid, and you don't see Hoovervilles or shanty towns of the homeless next to every town. I remember the big prices crash of the early 1990s, although most people seem to have blanked it out. There were crashes before that, occurring regularly back into the 19th century, whenever the bubble burst. Whether our society with its crumbling welfare system would be able to support the consequences of another crash, is another matter.