We agree that London housing is inefficient and poorly distributed. The capital is quite sparsely populated compared with most capital cities, so there is tremendous potential to increase housing supply. The government should be concentrating on reducing red tape and promoting housebuilding.
Barwell wants banks to be subsidised to build “up to” 100,000 prefabs nationwide. The overwhelming majority of housing transactions in London are of existing property. It is on regulating these transactions that Barwell should concentrate. London housing is inefficient and poorly distributed. Too many people occupy more space than they need. They should divide, rent or sell. Taxes and planning regulations discourage these. London taxes sales through stamp duty. This must keep thousands of properties off the market. If this is a crisis, it is government-sponsored. London’s so-called housing crisis is a derivative of the capital’s economic success. Prices will come down when and if London’s economy starts to slacken. Meanwhile, we should plead for a saner basis for property taxation, one that penalises under-occupancy and encourages sales. Barwell should be encouraging renting, not driving up prices with mortgage subsidies.