In many countries where property prices are in a bubble: Cities of China, Singapore, KL and Iskandar Malaysia, most cities in Indonesia, New York, London, Sydney and Melbourne, there is greater need for social housing.
Recently, in a property convention in west London, there were many protestors against the greed of developers. They demanded affordable housing instead of luxury homes for foreigners and investors.
However, many welfare states in the west are practically bankrupt. The generous welfare payouts have left governments with insufficient funds to build affordable homes. In Asia, the governments couldn't care less and are too corrupted to build affordable homes, with the exception of maybe Singapore and Japan.
Income and corporate taxes cannot rise further, otherwise it will remove incentives to work hard and chase away businesses. Where will the funds come from?
When people in the west want affordable homes, they will have to be prepared for much less welfare payouts, less dependence on the state for pension. In fact pension funds should be privately run and not underwritten by the government.
Another mistake made by western governments is to rent out the affordable homes. People who own homes tend to work harder to pay off mortgages than people who rent. There is truth in the saying that a "home is a man's castle". once you own a home, you will work hard to make sure the mortgages are paid. Gradually when property prices appreciate, they will upgrade their homes, buy multiple investment homes. This is how people are rooted to the country and have a stake in the economic pie.
The malaise in Europe and increasingly in the US is an entitlement attitude. Most feel that it's the job of the government to make sure basic needs are taken care of. This is liken to a communist system that will never work.
Recently, in a property convention in west London, there were many protestors against the greed of developers. They demanded affordable housing instead of luxury homes for foreigners and investors.
However, many welfare states in the west are practically bankrupt. The generous welfare payouts have left governments with insufficient funds to build affordable homes. In Asia, the governments couldn't care less and are too corrupted to build affordable homes, with the exception of maybe Singapore and Japan.
Income and corporate taxes cannot rise further, otherwise it will remove incentives to work hard and chase away businesses. Where will the funds come from?
When people in the west want affordable homes, they will have to be prepared for much less welfare payouts, less dependence on the state for pension. In fact pension funds should be privately run and not underwritten by the government.
Another mistake made by western governments is to rent out the affordable homes. People who own homes tend to work harder to pay off mortgages than people who rent. There is truth in the saying that a "home is a man's castle". once you own a home, you will work hard to make sure the mortgages are paid. Gradually when property prices appreciate, they will upgrade their homes, buy multiple investment homes. This is how people are rooted to the country and have a stake in the economic pie.
The malaise in Europe and increasingly in the US is an entitlement attitude. Most feel that it's the job of the government to make sure basic needs are taken care of. This is liken to a communist system that will never work.
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