Housing shortages and the collapse in public ownership of land

Since Margaret Thatcher came to power in 1979 some 2 million hectares of public land has been sold off, largely to private developers. As this useful FT piece makes clear it is the biggest privatisation we’ve never heard of.

It’s enriched developers and signally failed to encourage housebuilding on anything like the scale the country needs:

Throughout the past four decades, and especially since the global financial crisis, one of Whitehall’s principal justifications for driving the sale of public land has been to enable the private sector to build new homes on it. But it is increasingly clear that the private sector has under-delivered.

Much of the public land released to developers in recent years has not been built on but has instead simply been added to their already engorged land banks. The average number of years of housing supply sitting in the major UK housebuilders’ ‘current’ banks — those containing land that has, or is close to receiving, planning permission — doubled from around three in 2006 to around six a decade later.

Although Sir Oliver Letwin’s final report into landbanking practices was a damp squib, the letter he wrote to Philip Hammond and Sajid Javid midway through his investigations made clear the issue. When developers bank rather than build on land (including ex-public land) they do so not due to the alleged “web of commercial and industrial constraints” but because building too many homes too soon risks ‘disturbing the market price’ of housing. In other words, it hits profits.
— Read on ftalphaville.ft.com/2018/11/08/1541675709000/The-collapse-in-public-ownership-of-land/

Worth reading in full.

Housing shortages and the collapse in public ownership of land