Great idea for housing

Liam Halligan  in FT

The UK has built three million too few houses over the past 30 years, reducing owner-occupancy from 73% in 2007 to 63% today – below the average that prevails in the European Union, says Liam Halligan. We need “radical reform on the supply side”, where the “nub of the problem is our opaque, dysfunctional land market”. Land values can rocket when planning permissions are granted and the “planning gain” accrues solely to landowners and housing developers, which are an oligopoly: the top ten build two-thirds of new supply, and sometimes stage go-slows to maximise profits by producing fewer houses so that prices continue to climb. The planning gain should be shared with local authorities on a 50-50 basis, as is the case in much of the world. That would make land cheaper, houses more affordable and produce cash to build schools and hospitals. New homes would become much more popular with locals, “transforming the fraught local politics of planning”. Meanwhile, much of the supposed greenbelt should be developed. It now covers 13% of the country, while houses and gardens comprise just 1%. Forget a “spiteful” mansion tax: “tackle the vested interests” instead.