Sunday, 31 May 2015
Brainless lefties will like the above cartoon. The truth is that the explanation for high house prices is more nuanced.
High house prices in the UK are largely down to artificial restrictions on the amount of land available for house building. For evidence of that, witness the fact that the value of land with permission to build is about a HUNDRED TIMES that of agricultural land. Put another way, about a THIRD of the cost of houses in the UK is accounted for by the cost of the land on which those houses stand.
In short, high house prices are not caused by “free market capitalism”: they’re caused by what might be called the opposite. That is, artificial interferences in the free market.
Of course I’m not suggesting a complete “free for all”: i.e. allowing anyone to build a house absolutely anywhere. But there’s absolutely no reason that the TOTAL AMOUNT of land available for building purposes can’t be substantially increased, which would bring the price of houses down by approaching a third.
Mind, there is a sense in which the cartoon is correct: the main opponents of releasing land for building are clearly not people living in small apartments in cities. The opponents are what might be called the "capitalist class": NIMBYS with houses in the country.