The IMF Says Britain Should Build More Houses: Increase Supply, Dummy
WE don’t really need an international economics organisation to tell us this: that Britain should build more houses. That prices are going through the roof, that no one normal can actually afford on in London any more, is all the evidence we need that there’s simply not enough of them to go around.
Because, you know, when prices go up that’s a signal that supply is falling behind demand, that basic idea at the heart of economics stuff. But the IMF has gone ahead and told us so anyway:
On the issue of planning, she said: “But we also recognise that rising house prices fundamentally reflect demand that greatly exceeds supply. Addressing imbalances in the housing market by alleviating supply-side constraints will require further measures to increase the availability of land, land for development and to remove unnecessary constraints to land use.”
The IMF’s report also criticised the “unnecessary constraints on brownfield and greenfield developments”.
There’s simply no shortage of land in the UK: only 3% of the country actually has houses on it and only 10% is developed at all. In fact, in some counties there’s more land us for damn golf courses than is for housing. So we could double the amount of land we put houses on and it would amount to less than 2% of the country. We’d really not even notice this overall. Except, of course, that houses prices could come back down to where the average person might have a chance of buying one to live in.
And that’s really what the IMF is arguing: just issue some more planning permissions and let people go and build more houses. It’s a simple enough idea: prices are too high? Then increase the supply. Problem solved.