Collinson finally understands land banking
james36armstrong at hotmail.com
Thu Nov 30 21:35:42 GMT 2017
House prices aren’t the issue…..
I read in the Guardian about land banking being the cause of the crisis in 2014-
Thanks Guardian for helping solve the riddle of why more houses are not built in spite of large numbers of people in housing need and houses fetching record prices.
“Tesco unlocks its landbank to build 4,000 homes”
(pausing to query how it is that Tesco are so sure to get permission to build houses on land earmarked for retail development and whether the houses will actually be built and when ) we refer to The Barker Review of House Supply Interim report 2003 where just seven named corporate house-builders held landbanks of land surplus to their present or imminent requirement equivalent to 732,000 (unbuilt) new houses. Compare the total new house completions achieved in England in 2013 of 109,370.
Just one named corporate house builder , Wilson Bowden, whose annual output in 2002 was 4,164 houses held a landbank sufficient to supply more than the whole national new house build or 33 years supply of their own requirements at their then annual rate of build. Wimpey held 16 years supply and Persimmon 19 years supply.
Barker explained landbanks -
“housebuilders are primarily rewarded for obtaining valuable land rather than responding to consumer needs” which translated from Whitehallese means that they make greater profit on the rise in value of undeveloped land than they do from building houses on it!
But it is not only housebuilders who block development by holding landbanks .
Barker reported that Legal and General held a landbank equivalent to 79,000 housing units. Although it was unpermissioned land , Barker explained a housebuilder might hope to have it included in a local development plan.
Near Dorchester , in 1994 the Duchy of Cornwall was granted permission to build some 8.000 new houses on land formerly Poundbury farm and Middle farm.
Twenty years later many of the houses have yet to be built.
Now to housebuilders who wont build and insurance companies (pension Funds ?) who don’t build we have giant corporate retailers, traditional landowners …and who else ?.... withholding the only land earmarked for building houses .
It is ironic that self builders reported to the Office of Fair Trading Home-building (sic) Survey 2008 that finding land was their greatest perceived difficulty.
The British housing market is broken, caused not by a game but by real life monopoly in which the landbankers always win.
(letter in the Guardian 23 July 2014 )
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