Tuesday, 22 July 2014

Faux Lib idiot of the day

A comment under this article in City AM was abbreviated and published as a reader's letter today:

Modern homes, as decreed by modern planners and politicians, are too small, too dark, too inflexible, too crowded and too like C19th slums for them to be bought by anyone in their right mind - assuming they had a free choice of houses within their budget and location.

The sad truth is that 'what the State controls, the State rations' and that has never been more true than for housing and infrastructure.

The solution is blindingly obvious - scrap planning controls and let landowners, builders, developers and buyers have a free choice of what, where and how they want to live.



It's private, profit maximising developers who bash out the tiny homes because they can get away with it; they arise because of the absence of state intervention. If local councils reintroduced minimum room sizes or better insulation requirements, this twat would still be shrieking about state controls and state rationing.

And who built those C19th slums? Was that not private developers operating without state regulations?

And it's the NIMBYs crying out for planning restrictions, I don't think that the government in the abstract sense could give two hoots how much gets built.


Buyers and non-landowning "builders" (i.e. construction workers) will never be on a level playing field with landowners and developers (aka land bankers). They will never have a free choice of where to live or ply their trade

Those land bankers have got plenty of plots with planning, but to maximise their profits, they are just allowing them to trickle onto the market. A load of contsruction workers were laid off back in 2008 so that the land bankers could wait for prices to go back up, so if you are a buyer you have to wait ever so humbly and patiently until they deign to actually build one or an existing homeowner decides to sell one, it's not like you can buy from the competition instead because there isn't any.


Curmudgeon said...

But aren't planning controls requiring a certain number of homes per acre one of the key reasons behind tiny houses - and lack of parking provision?

Mark Wadsworth said...

C, but who do you think influences planning reg's? It's the NIMBYs on the one hand and the developers on the other. Politicians just take the line of least resistance.

NIMBYs are perfectly happy with new homes having tiny gardens as they use up less of the Hallowed Green Belt and developers are perfectly happy building shoe boxes as it maximises their profits.

(Admittedly, some councils have insane ideas about parking spaces, that is 'political').

Dinero said...

Yes there is "minimum density" regulations.

So now we have planning permision , Local residence resistance, green belt, regards of profit, and now minimum density regulations all making dwellings smaller against the wishes of potential occupiers.

And yet you drive 1/4 of an hour in any direction and you are in land that is not used for anything much economically due to market forces and agriculture policy, and farmers paid to oversee meadows.

Mark Wadsworth said...

C, or imagine the NIMBYs relaxed a bit and developers and councils between them agreed that overall, they would build bigger houses everywhere with bigger gardens.

In the more desirable areas, it wouldn't be long before the larger houses - intended maybe for a family - are crammed full of students or young tenants sharing rooms etc. So instead of eight people in four tiny flats, it's eight people in one large house. Same old same old.

Din, agreed. Although IIRC, most councils regulations dictating the upper limits for what can be built, not lower limits.

Kj said...

So in other words, planning does reduce housing sizes?

Ian B said...

You're not making sense again, Mark.

Suppliers can only restrict supply and force up prices when there is a heavily restricted market, as in this case. Take away the planning permission, and anyone can easily build a house, so those who try to restrict supply will be undercut by new market entrants.

Curmudgeon said...

I don't see much evidence that newly-built "executive" houses in nice areas are being converted to multiple occupation or having shanties built in their gardens.

Houses are only so tiny because the supply of building land is restricted by the planning system.

Lola said...

MW. There's something not quite right about your analysis, or perhaps it is incomplete. I have watched from the inside the operations of two spec house builders; one my old man and two, Barratts. Both of them tried to design 'competitive' houses and neither (in my experience between 1952 and 1989) 'land banked', as such. My pa bought land to build to keep his production line going. Barratts did the same, only selling of plots that were for them too small to be viable (these were mostly parcels of existing sites they developed).
In both cases they tried to be 'design led'. That is they tried to build houses people wanted and worked for them. Note, this was Barratts in the late 1980's, not in their first time buyer era. My pa's frustration was that owing to land prices and construction costs he could not build what he thought was a viable first time buyer three bed home - taking into account family needs like real storage space.
Competition seems to have been working only on price and not quality, whereas in the rest of the productive economy you get more stuff at a lower price every day.
I think, think, the problem here is not lack of regulation on room sizes (say) but the fact that landowners suck out all the profit - economic and real. In short it is a land price problem.
I should also say that in both cases their experience with planners was dire. And also rampant nimbyism.
So the issues with poor housing are not the result of bad developers per se, but of bad public policy in respect of tax (absence of LVT), planning and pandering to nimbys.
Having defended developers, I also know of one or two now who are absolutely dire. I could name them, local market towns always have about six of these rent seeking gits - but again LVT (dealing a death blow to land speculation) would sort most of them out.

Mark Wadsworth said...

Kj, yes of course it does, but planning does not restrict number-of-people-per-home.

So build bigger homes and you just get more people sharing.

IB, as per usual I talk perfect sense.

Look at times in English history where there were no planning laws (the author's C19th example), look at countries with no planning laws (South America - favelas). The vast majority of the population end up renting or living in shitty cramped accommodation.

Fact is, and I'm sorry to say this, but decent housing depends on the majority of the population agreeing that decent housing at affordable prices is important. And the "government" does what the majority of the population wants.

C, but who imposes the planning system? The NIMBYs or the politicians who want to be re-elected?

Until owner-occupation rates reached the tipping point of 50% in the early 1970s, there were more votes in allowing more homes to be built. Since then, there were more votes in allowing fewer homes to be built.

L, in the 1950s to 1980s era, different rules applied. There were rent controls and mortgage restrictions, so builders lived off volume, not land value gains.

Since then, these big 'developers' are largely land price speculators and they boast about this in their published accounts.

Lola said...

MW - as was / is Tescos, Sainsbos, et al.

Ben Jamin' said...

You could increased the cost of building a new home by regulation three fold, and aggregate HP's wouldn't rise.

Not saying this is a great idea, because you'd only be increasing deadweight costs.

If you did however de-capitalise rents, so houses went down to their cost of production, people would no doubt spend some of their extra discretionary income on better bricks and mortar.(downward pressure on land rents).

That's what happens when you get a level playing field.

No regs needed.

Ralph Musgrave said...

How come they build decent size houses in the US, Australia etc, and all without any more rules and regulations than we have?

It's cos they got more land!!! Or to be more exact, land for building on is more freely available there than here.

Mark Wadsworth said...

RM, please compare like with like.

In high value areas where land is expensive, US houses are just as small as ours, and/or normal people live on as little space as we do in our high value areas.

In the large swathes of the USA where land is cheap, people have larger, cheaper gardens and plenty more money left over to buy a large wooden structure.

Curmudgeon said...

I'd be very surprised if anywhere in the US or Australia was putting up new-build houses remotely as titchy as ours.

It would also be interesting to compare the average size of new houses in the Netherlands - which has about the same population density as England - to here.

Mark Wadsworth said...

C, maybe, maybe not, but however large the house is, you can't stop lots of people from moving in and making it crowded.

In NL, where they have good old fashioned State Intervention & Regulation, new houses or flats are much bigger than in the UK. Obviously.

Bayard said...

This, like much of the other anti-planning letters and articles looks very much like developer astroturfing. A little thought will show that plot sizes have very little to do with house sizes. In the past, our ancestors fitted larger houses onto smaller plots by simply adding another floor. How many three or four-storey houses do you see being built these days? A small decrease to the size of the average garden is a large increase to the house it surrounds, which is why people build extensions.

Landowners in the green belts are the ones who stand to gain the most from scrapping or relaxing planning restrictions, so it is most likely that they are behind this latest offensive in the war on planning.

Why should having more houses built make them larger? Quite apart from the fact that increasing supply has been shown not to lower price, if a developer can sell a small house for a given price, why on earth should he build a bigger and more costly to build one for the same price as the small one? If he charges more for the bigger house, then he is going to price himself out of his target market.

Anonymous said...

@ Curmudgeon

I'm developing some knowledge of the housing market in Australia. 'Inner Suburb' apartments, at the very least, are pretty much the same as the little boxes we build over here - except for that they're much more likely to have usable outdoor space (most mid-priced new build flats have a balcony/terrace which is at least big enough for a BBQ and a table set).