land price revolution

[james armstrong]

 SPIVS AND GAMBLERS. -
the murky world of capitalism

It is  not new to say, like Vince Cable to-day ,
that people are being systematically exploited. 


RH Tawney, in ‘Religion and the Rise of Capitalism’
published in 1926 summarises the process as ‘plundering the public’.

The rise in land prices in £ per hectare, for England  published by Defra shows the following trends:-


 

Ten year period  1973
,  £1,557   to 1983  
£3,631 An increase of  133%

Ten year period 
1983    £ 3,631  to 1993  
£3,791  An increase of  3%

Ten year period   1993   £3,791   
to 2003  £7,172  An increase of   89% 

Ten year period  
1998   £ 6,134   to 2008  
£14,152 An increase of 131%

 

 For the most up to
date year 2008 ( £14,152 ) the increase over the  previous year 2007   (£10,974)  is an unprecedented  annual rise of 29%

In this sustained increase in land prices we are
experiencing a revolution as cataclysmic as the religious Reformation ,  the discovery of  America,  the confiscation of the monastic estates and
the industrial and agricultural revolutions.

 

You hadn’t noticed? 
Just one example is the distress, 
dispossession and despair  caused
by the  rise of house prices in which the
cost of building land is an important factor. 
  

If there is any  consolation to would-be small holders seeking
to buy a field , these prices will exaggerate the price of agricultural land
since they will include the windfalls received when a field in which the cows
are grazing receives planning permission for development when it may jump
overnight in value from £3,000 to £1.3 million per acre. The stats will
over-represent  development land as against undeveloped agricutural land since
there is a brisk market for the former  amongst
developers and such land trades at a greatly inflated price. 

What is the two main mechanisms for the  increase in land prices.? 

We joined the Common Market in 1973. Also housebuilders
(encouraged by successive governments) manipulate  new house supply-downwards- and therefore the  price of houses–upwards.

    Since 1973  we have been rewarding landowners £billions
annually. One such barley baron is recorded as saying he could not believe his
luck when the windfall CAP cheques started to arrive. Individual  payments to landowners from taxpayers of
£100,000 annually are not unusual- ask Richard Drax M.P., and the Queen.  

The direct connection between land prices, the rate of  housebuilding and level of house prices is
provided  by the Duke of Cornwall at his
Poundbury development where the price of each new house - (there are 2,500
planned to be  phased over a twenty five
year period)- each one  put on the market has its price set  individually to reflect the rising
market on the day it is completed  or, when demand stalls,  
building activity falls, avoiding  the need to drop the  price of new houses. So after sixteen years
only 800 out of the  2,500 new houses permitted
at Poundbury have been completed.  In spite
of the land being acquired by the Duchy by inheritance at no cost , the   houses are sold at premium prices.   –what Tawney would call ‘plundering the
public”. Plunder, the rise in land prices certainly is,  and it is 
the ninety nine per cent who own no bulk land, i.e ‘the public’ who fund
the CAP payouts, and are, largely unknowingly,like the house buyers and house-less,  being fleeced.   James .    

 

 

 		 	   		  
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