The balance of power is shifting away from property owners

Updated
The length of the housing market depression has resulted in home owners being forced to offer properties for rent as an alternat
The length of the housing market depression has resulted in home owners being forced to offer properties for rent as an alternat



Earlier this month, Bristol's mayor, George Ferguson, pushed through the sale of the freehold of the city's 2,100-acre port to its leaseholder, the Bristol Port Company. The price is to be £10m.

If that sounds low, I suspect it is. It might be a perfectly reasonable price for the sale of the freehold alone, but takes little account of the enormous value in the marriage of the freehold and the leasehold.

Many of his councillors were unimpressed — they voted 41 to 16 against and asked him to reconsider. And judging by the online reaction of the people of Bristol, they weren't much impressed either. But the will of the collective owners of the port was effectively pushed aside by the mayor in favour of that of their tenants.

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The Bristol Port Company gets to buy the freehold for what looks like a knockdown price because they have the cash to hand, and because they asked — and crucially, because they are already in residence. You can watch the relevant webcast for the council meeting on their website (though I am not sure I would recommend it) but as one observer tells me, the mayor's case for this transfer of wealth appeared to boil down to the fact that the leaseholders are "good chaps and have run the port well for the last 20 years".

You might think that sounds just fine. But it isn't the way we usually think of property rights working: in a normal capitalist transfer, the seller is obviously willing and the price keenly commercial.

You may be wondering why this local conflict is of interest to me. It is because the mayor of Bristol isn't the only person embracing the idea that ownership is as much about residence as actual ownership. David Cameron is also insisting on shifting wealth from its owners into the hands of a lucky group of people who just happen to be resident in the right place at the right time. How else can you describe giving housing association tenants the right to buy the properties in which they live for a knockdown price?

Then cast your eye north to Scotland. The SNP-led government has just introduced its land reform bill. This, too, represents a huge shift in power from the landowners to the residents and users of land. Even a skim of the legislation will show you that it is jammed with right-to-buy clauses and power transfers to "communities".

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Interesting, isn't it? These examples of wealth transfer from right-to-buy come from different directions and political positions, but they all suggest the same thing: a convergence around the idea that owners shouldn't have exclusive ownership rights.

Now let's chuck one more thing into the mix — rising wages around the world. Here in the UK real wages are finally rising, and both the left and right are arguing for higher wages for everyone. Note David Cameron's recent remarks on how people should be making their incomes from rising wages rather than tax credits; the mini strikes that keep popping up (Scottish ferries, Newsquest journalists); and the fact that hanging on to good full-time staff clearly isn't easy. The Office for National Statistics tells us that those who have hung on to full-time jobs since the financial crisis have seen their wages rise smartly.

The same is happening in China, where annual wages are rising at about 12% a year; in Japan, where a cornerstone of Abenomics is rising wages; and in the US, where Walmart has just announced a raise for 100,000 department managers and specialists.

So what does it all add up to? I wrote a year and half ago about just how much of a "boss's world" ours has become over the last 20 years — the share of corporate output going to profits (and hence to shareholders) had soared and that to workers collapsed.

At the time I noted that these swings in the relationships between profit and labour — or tenant and landowner — take decades to play out, but I felt we were seeing the same signs of a shift as we saw back in the 1960s when the government was "irrevocably committed to doing something for the low paid" and the low paid were also figuring out how to do something for themselves.



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