How should anti-crisis housing support programmes be structured that could significantly reduce the scale of the 2023 economic crisis?
Inflation is rising. Central banks are raising interest rates in an attempt to curb rising inflation. Credit is becoming more expensive. Sales of loans offered by commercial banks are falling. Also, the amount of housing loans, mortgages, for construction investments is falling rapidly in 2022 against 2021. As a result, the activity of economic processes is falling, the economy is deteriorating, the amount of new investments is falling, and unemployment may start to rise in the following months and quarters. Perhaps at the end of 2022 or in 2023, many countries will see a deep economic downturn, a recession of the economy, perhaps also stagflation. The construction sector, on the other hand, is classified as a cyclical sector in economies. Therefore, in order to limit the downturn and reduce the scale of future recession, the government, as part of its anti-crisis economic policy, should support the development of the construction sector.
Support programmes for new construction investments should be developed. Perhaps new financial support programmes for the purchase of housing could help in this regard?
If so, how should anti-crisis construction support programmes be structured?
What are the anti-crisis housing support programmes?
What is your opinion on this subject?
Please respond,
I invite you all to discuss,
Thank you very much,
Best regards,
Dariusz Prokopowicz
Anti crisis housing support programmes.
In a private sector driven economy, the following programmes would be anti crisis in the housing sector
(1) Importation of building materials should give way to domestic production. This will promote economic growth and reduction in prices of building materials and price of house rent on users
(2) Government regulatory agencies should ensure that building plans are approved and houses built according to approved standard to avoid building collapse.
(3) Good network of road, electricity, water supply, drainages and spacing should be provided for convenience.
(4) Though in a private sector driven economy, government may not directly control the price of house rent but can provide for checks. Also tax on land and house should not be astronomical to trigger increase in house rent.
(5) Private sector should be minimal in their house rent. House owners should be friendly to Tenants and increase in house rent or otherwise should be in the form of dialogue between Landlord and Tenant.
IN A PUBLIC SECTOR DRIVEN ECONOMY
(1) All houses are owned by government. Government maximises social welfare as private sector maximises profit. Houses should be allocated or sold to the public on break even.
(2) Adequate infrastructures should be provided in buildings as well as open spacing.
(3) Corruption on government officials in using low quality building materials should be avoided in order to avoid building collapse. Allocating government built houses to government officials is a menace and must be avoided. Also outrageous bills on house construction should be checked through the appointment of transparent, meritoccracts and patriotic citizens.
IN A MIXED ECONOMY
(1) Both government and private sector have the right to built houses and fix prices according to their dictates. In this case government regulatory agencies should ensure that house plans are approved and built according to standard to avoid collapse.
(2) Government may subsidize building materials to engender the growth of the sector.
(3) Houses should conform with the Dynamics of international status.
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