Price of building land is key to affordable homes

KARL Sheridan (Yorkshire Post, July 18) makes some good points about the advantages of timber-framed housing. However, the wider use of this technology would have virtually no impact on the cost of housing for one fundamental reason.

The extraordinary rise in the value of houses in recent years has had little to do with the increase in the cost of construction and is almost entirely due to the increase in the value of building land with planning permission.

When I started in the surveying profession in the 1950s, the value of a plot for a modest house was of the order of £250 to £400. Today the equivalent figure is £60,000 to £100,000. This has been caused by the very necessary restraint on development imposed by planning control, coupled with a greatly increased demand, because of rising population and smaller households.

However, the element in the equation which really blew the lid off was the mad scramble by the banks to lend too much money to people desperate to get onto the housing ladder, which, as we all know, ended in tears.

If housing is to be made reasonably affordable for people on average incomes, more development will have to take place on sites costing less than at present. I suggest that suitable sites are designated as being for affordable housing and acquired by housing associations at a stated fraction, say a quarter, of the value of the land for open market housing. This would still be a huge premium over agricultural value to the landowner. The houses could then be built to rent at a price which people could afford. The right to buy would have to go.

I am sorry, but getting a roof over your head is more important than enjoying an unearned and untaxed capital profit. If household income is not stretched to the limit by housing costs, savings can be accumulated in other ways.