Housing or Financial Crisis?
It is common to see the Banks being blamed for the current economic crisis but that is far too easy a solution. It would be just as easy to blame local authority planning departments for the financial crisis! Before they erupt in protest it is worth looking at the cause of the deeper crisis that exists within the UK. Though the UK problems are only part of the international picture. The problem in America started in their housing sector which is firmly where the problem lies in the UK. In Germany house prices generally vary by only half of one percent each year. The year before the crisis started house prices in Germany fell by 0.48% and that was greet as good news helping families buy homes. In the UK soaring house prices has for far too long been seen as good news despite the devastation that does to the plans of so many people.
We have a society split between those sitting on existing property, and the desperation of those trying to buy and feeling excluded, and those who have bought encouraged by banks and mortgage companies who find they have been extended beyond their means. The banks lending on the basis of rising house prices rather than the reality of market forces and the laws of supply and demand, have not just caught a cold. A raging fever has set in fuelled by panic and fear for the economic reality they had long forgotten. Of course many of the banks have 'let go' the more experienced senior managers, favouring lower cost younger managers driven by a desire to prove themselves and lacking any motive to employ a 'wise head' when assessing the market.
High house prices are the source of the problem. Why are they so high? The answer is unpalatable to many. In the rest of the world they have no qualms about building on green land. In the UK we have a paranoia fuelled by various lobby groups, along with a quite natural desire to retain England's green and pleasant land, and protect the environment. That is understandable, but it ignores the facts. Only 11% of the UK has buildings on it. 89% is green land. No wonder councils struggle to find brownfield sites! No wonder on those sites housing is condensed. Bad designs predominate approved by planning departments who follow the fears of the community and endeavour to restrict building in the countryside. Our own council is seeking support to scrap village settlement boundaries and ban further house building in small villages in the Borough!
The cost of land with permission for housing skyrockets, when otherwise it should be quite cheap. We have used the planning process to distort the natural market and created misery and desperation and debt for millions of people in the UK who want to own their own homes. It's time for a change.