Building green belts

Read in The Economist of 26 September 2015:

Something’s badly wrong. On my way back from the UK, I read an article in this week’s edition of The Economist on the booming housing market in and around London. Despite stagnant incomes, Britons have taken on masses of cheap debt. All this demand has run up against ‘sluggish supply’. People think foreign ownership of London real estate is the problem. It is not. That problem concerns only certain parts of inner London. Demand from within Britain exerts much bigger effects, according to The Economist. The magazine thinks this is partly due to strict planning laws. Green belts are protecting the landscape around cities; these belts now cover 13 per cent of England. How sacred are they? The conservative government wants to get rid of those planning schemes and, by doing this, make it easier to build. The Economist thinks cheap debt is not the problem, but spatial planning. The magazine quotes Paul Cheshire of the London School of Economics, who thinks London could build another 1,6 million houses in the Green Belt around the capital city. The magazine agrees, because much green-belt land “is far from green”.

So that’s the end of planning, even though everybody knows that when planning permission is forthcoming, housebuilders have held back. Why? Because builders try to sell new-builds at a price in the upper decile of those prevailing in the local market. “Since coming to power in 2010 the Conservative government has done more to boost demand for housing than increase its supply. Labour, meanwhile, talks about rent controls, which could flatten supply still further.” While reading this, I had to think of the recent study of Greg Clark, senior fellow of the Urban Land Institute, who gave a lecture in Amsterdam last week on the lack of density in our cities. In ‘Density: drivers, dividends and debates’ (2015) he demonstrates the great value of density, “to advocate for the best practices that can produce it, to bust the myths, and to start the process of informing and supporting new leaders to put density at the heart of long term planning for the future.” We should densify our cities now! Would be a great read for the editors of The Economist.