Byline: Thomas Aubrey

Stop blaming the planning system for everything. Improving the efficiency of the land market will have a far greater effect in driving up the rate of house building than further planning reforms

The government reckons that its housing and planning bill – with the additional measures announced in the autumn statement – will lead to the construction of an extra million homes by the end of this parliament. That means increasing the rate of completions from the 2014 level of 118,000 to well over 200,000 per year. Empirical analysis estimates that there are already over a million plots with planning permission – close to 25 per cent of these in London. And if the current rate of granting permission continues at 250,000 plots per year, this figure will have climbed to over 2 million plots by the end of the parliament. Although there remain some challenges with the planning system, the government must focus on improving the functioning of the land market to drive up construction levels. The way in which volatile and high land values interact with the business model of housebuilding reduces supply. Continue reading “Boosting Britain’s housing stock”

Compared to European counterparts, Britain’s housing market is a picture of market failure

Across the European Union there is often a perception that Britain takes a more market-oriented approach, and where Britain leads continental Europe eventually follows. However, when it comes to housing, this is not the case. Britain’s housing market is far more dysfunctional than its European counterparts. A comparison of two key metrics of a group of six northern European countries demonstrates that the UK has by far the largest market failure in housing. The UK continues to have the lowest construction rate of all six countries. Moreover its housing benefit bill, due to soaring rents, dwarfs that of other countries and is now almost 10 times that of Germany.

Continue reading “Britain’s dysfunctional housing market: a European comparison”

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