HOUSTON WE HAVE A PROBLEM !

This message comes not from a space, or rather not from space as Houston might have once understood this, but from built space on the ground. In short, Houston has too much new space, although in fact this is not a new problem. Th city has always had a tremendously speculative property market, and it has not been unusual for large amounts of commercial space to lie empty. However, the sheer volume of speculative real estate development in recent years, combined with the sub-prime crisis, whose aftershocks are still reverberating around the United States, has created unprecedented difficulties for home owners. To mix metaphors even more, many of these properties are "under water", a North American term for negative equity, and citizens around the country are having to get to grips with this, the ongoing problem of mortgage foreclosures and associated debts. The title of this post comes from a briefing for people in the Texas city of Houston who are thus afflicted.

The situation in the UK is different because speculative real estate development is regulated through a planning system which just about survived the previous administration and may, or may not, fare better with the present one. The appointment of Ed Balls as Shadow Chancellor last week is a timely reminder that had his good wife Yvette Cooper, Housing Minister for several years under New Labour, had her way the situation over here might be more akin to the US, Ireland and Spain. For what Balls means by "growth", and we shall be hearing a great deal more from him on the subject, is an over-developed construction and and real estate sector, notably in the form of speculative house-building on green field sites. This is precisely the kind of growth the United States experienced during the so-called boom years. Meanwhile, the managed decline of former industrial cities was encouraged, a policy which New Labour also embarked upon with the disastrous "Pathfinder Programme", now fortunately abolished by the Coalition Government. The last thing this country needs is US-style planning !

Postscript: "A Man in Full" by the American writer Tom Wolfe remains, in my view, one of the best accounts of the property cycle in the United States. Without wishing to divulge details of the novel's plot, I would also add that the hero's "journey" in one key respect resembles Tony Blair's.